Tech is always an exciting sector, especially when companies pay handsome dividends. Today we focused on tech stocks that offer nice, sustainable dividend payouts, fueled by their reliable track records of profitability. To focus in on the best of the best, we screened for only those stocks that analysts rate as 'Buy', or 'Strong Buy'. We came up with a rather interesting list of tech companies; tell us what you think.
The Operating Profit Margin is a profitability ratio that measures the effectiveness of the company's operating efficiency. This metric allows investors to see how much profit is left after all variable costs are covered. If the company's margin is increasing over time this means that it's earning more per dollar of sales. Finding trends in the Operating Profit Margin helps investors identify companies that are improving profitability over time and managing the economic landscape better than competitors.
The Net Margin is a profitability metric that illustrates, by percentage, how much of every dollar earned gets turned into a bottom line profit. This is just one of many profitability metrics used by investors and analysts to better understand what the company is being left with at the end of the day. Generally, a firm that can expand its net profit margins over a period of time will see its stock price rise as well due to the trend of increasing profitability. Net Margin = Net Income/Total Revenue
We first looked for technology dividend stocks. Next, we then screened for businesses with strong profit margins (1-year operating margin>15%)(Net Margin [TTM]>10%). We then looked for businesses that analysts rate as "Buy" or "Strong Buy" (mean recommendation < 3). We did not screen out any market caps.
Do you think these stocks have higher to rise? Please use our list to assist with your own analysis.
1) j2 Global, Inc. (JCOM)
|Industry:||Internet Software & Services|
j2 Global, Inc. has a Dividend Yield of 3.32%, a Payout Ratio of 26.32%, a Operating Profit Margin of 43.82%, a Net Margin of 32.72%, and a Analysts' Rating of 2.40. The short interest was 28.83% as of 06/26/2012. j2 Global, Inc. provides cloud services to businesses of various sizes through the Internet worldwide. It offers online fax, virtual phone systems, hosted email, email marketing, online backup, customer relationship management, and bundled suites of these services. The company markets its services principally under the eFax, eVoice, FuseMail, Campaigner, KeepItSafe, LandslideCRM, and Onebox names.
2) Landauer Inc. (LDR)
|Industry:||Scientific & Technical Instruments|
Landauer Inc. has a Dividend Yield of 3.99%, a Payout Ratio of 91.98%, a Operating Profit Margin of 24.05%, a Net Margin of 17.28%, and a Analysts' Rating of 2.00. The short interest was 3.60% as of 06/26/2012. Landauer, Inc., together with its subsidiaries, provides technical and analytical services to determine occupational and environmental radiation exposure primarily in the United States and Europe. The company operates in two segments, Radiation Monitoring and Medical Physics. The Radiation Monitoring segment provides analytical services; manufactures various radiation detection monitors; and distributes and collects monitors to and from customers, as well as engages in analyzing and reporting of exposure findings.
3) Vodafone Group plc (VOD)
Vodafone Group plc has a Dividend Yield of 5.32%, a Payout Ratio of 96.98%, a Operating Profit Margin of 24.10%, a Net Margin of 15.09%, and a Analysts' Rating of 1.80. The short interest was 0.16% as of 06/26/2012. Vodafone Group Plc provides mobile communications services in Europe, the Middle East, Africa, the Asia Pacific, and the United States. It offers voice services, such as mobile voice communications and voice roaming; messaging services, including text, picture, and video messaging on mobile devices; data services, such as email, mobile connectivity, Internet on mobile, and data roaming; and fixed broadband services, fixed voice and data solutions, mobile advertising, and business managed services. The company also provides various devices, such as handsets, mobile data cards, and mobile USB modems.
4) Telefonica Brasil, S.A. (VIV)
Telefonica Brasil, S.A. has a Dividend Yield of 4.13%, a Payout Ratio of 81.86%, a Operating Profit Margin of 21.20%, a Net Margin of 15.05%, and a Analysts' Rating of 2.10. The short interest was 0.40% as of 06/26/2012. Telefonica Brasil, S.A. provides fixed-line telecommunications services to residential and commercial customers in the state of Sao Paulo, Brazil. The company offers local voice services, including activation, monthly subscription, measured service, and public telephones; intraregional, interregional, and international long-distance voice services; data services comprising broadband services; pay TV services through direct to home satellite technology and land based wireless technology multichannel multipoint distribution service; and network services, such as interconnection and rental of facilities, as well as other services consisting of extended maintenance, caller identification, voice mail, cell phone blockers, computer support, and antivirus for Internet service subscribers. It also provides multimedia communication services, which include audio, data, voice and other sounds, images, and texts and other information.
*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.