Do you prefer stocks that pay their fair share in dividend income? Do you prefer investing in stocks that analysts rate as 'strong buy'? Do you prefer companies with high liquidity? We ran a screen you might find helpful.
The Current ratio is a liquidity ratio used to determine a company's financial health. The metric illustrates how easily a firm can pay back its short obligations all at once through current assets. A company that has a current ratio of one or less is generally a liquidity red flag. Now this doesn't mean the company will go bankrupt tomorrow, but it also doesn't bode well for the company, and may indicate that it could have an issue paying back upcoming obligations.
The Quick ratio measures a company's ability to use its cash or assets to extinguish its current liabilities immediately. Quick assets include assets that presumably can be converted to cash at close to their book values. A company with a Quick Ratio of less than 1 cannot currently pay back its current liabilities. The quick ratio is more conservative than the Current Ratio because it excludes inventory from current assets, since some companies have difficulty turning their inventory into cash. If short-term obligations need to be paid off immediately, sometimes the current ratio would overestimate a company's short-term financial strength. In general, the higher the ratio, the greater the company's liquidity (i.e., the better able to meet current obligations using liquid assets).
We first looked for dividend stocks. From here, we then looked for companies that analysts rate as "Strong Buy" (mean recommendation < 2). We next screened for businesses with a large amount of cash on hand (Current Ratio>2)(Quick Ratio>2). We did not screen out any market caps or sectors.
Do you think these stocks are worth more than their current valuations? Use our list along with your own analysis.
1) The Female Health Company (FHCO)
The Female Health Company has a Dividend Yield of 4.36% and Payout Ratio of 58.47% and Analysts' Rating of 1.00 and Current Ratio of 2.60 and Quick Ratio of 2.37. The short interest was 5.05% as of 05/18/2012. The Female Health Company manufactures, markets, and sells consumer health care products in the United States and internationally. It offers the FC2 female condom, which provides dual protection against unintended pregnancy and sexually transmitted diseases, including HIV/AIDS. The Female Health Company sells its products to public health clinics, as well as to not-for-profit organizations.
2) LSI Industries Inc. (LYTS)
|Industry:||Industrial Electrical Equipment|
LSI Industries Inc. has a Dividend Yield of 3.71% and Payout Ratio of 164.46% and Analysts' Rating of 1.00 and Current Ratio of 4.87 and Quick Ratio of 2.88. The short interest was 2.84% as of 05/18/2012. LSI Industries Inc. provides corporate visual image solutions in the United States, Canada, Australia, Latin America, Europe, and the Middle East. The company manufactures and markets outdoor and indoor lighting products for the commercial, industrial, and multi-site retail lighting markets, including the petroleum/convenience store market. Its lighting products include exterior area lighting, interior lighting, canopy lighting, landscape lighting, light emitting diode (LED) lighting, light poles, lighting analysis, and photometric layouts.
3) Evolving Systems Inc. (EVOL)
|Industry:||Technical & System Software|
Evolving Systems Inc. has a Dividend Yield of 3.00% and Payout Ratio of 74871.88% and Analysts' Rating of 1.30 and Current Ratio of 2.55 and Quick Ratio of 2.33. The short interest was 0.19% as of 05/18/2012. Evolving Systems, Inc. provides software solutions and services to the wireless, wireline, and Internet protocol (IP) cable markets. It offers Dynamic SIM Allocation solution that offers carriers a way to provide wireless services by activating and assigning resources to the wireless device when it is first used; and Tertio, a service activation solution for carriers to activate a new subscriber or to add a new service to an existing subscriber, as well as provides an operating environment to manage their voice, data, and content service needs for their IP networks. The company's LNP and WNP software solutions comprise OrderPath order entry; NumberManager network provisioning; LNP DataServer data warehousing; VeriPort NPAC testing; and Verify product suite for monitoring carriers' application communications.
4) National American University Holdings, Inc. (NAUH)
|Industry:||Education & Training Services|
National American University Holdings, Inc. has a Dividend Yield of 3.51% and Payout Ratio of 133.42% and Analysts' Rating of 1.00 and Current Ratio of 4.12 and Quick Ratio of 4.04. The short interest was 2.05% as of 05/18/2012. National American University Holdings, Inc. engages in the ownership and operation of National American University (NAU) that provides post-secondary education services primarily to working adults and other non-traditional students in the United States. The company provides associate, bachelor's, and master's degrees programs in business-related disciplines, such as accounting, applied management, business administration, and information technology; and in healthcare-related disciplines, including nursing and healthcare management. It also offers diploma programs consisting of a series of courses focused on a particular area of study for students seeking to enhance their skills and knowledge in the areas of healthcare coding, practical nursing, therapeutic massage, and veterinary assisting.
5) Communications Systems Inc. (JCS)
Communications Systems Inc. has a Dividend Yield of 6.07% and Payout Ratio of 52.07% and Analysts' Rating of 1.00 and Current Ratio of 5.85 and Quick Ratio of 4.16. The short interest was 2.72% as of 05/18/2012. Communications Systems, Inc., together with its subsidiaries, manufactures and sells modular connecting and wiring devices, digital subscriber line filters, structured wiring systems, and media and rate conversion products primarily in North America, Europe, the Middle East, and Africa. The company's Suttle segment manufactures and markets copper and fiber connectivity systems, enclosure systems, XDSL filters and splitters, and active technologies for voice, data, and video communications under the Suttle brand name; and residential structured wiring products under the SOHO Access brand name. This segment offers its products directly and through distributors to communication companies, smaller telephone companies, electrical/low voltage contractors, home builders, cable customers, and original equipment manufacturers.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz and Yahoo Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.