Do you prefer dividend income you can count on? We ran a screen keeping this idea in mind.
We began by screening dividend stocks (those paying dividend yields above 2% and sustainable payout ratios below 50%) for those that appear undervalued relative to free cash flow, with P/FCF below 15.
Then we screened for those with bullish sentiment from short sellers, with significant decreases in shares shorted month-over-month. This indicates that short sellers are less bearish on these names than they were a month ago.
For an interactive version of this chart, click on the image below. Analyst ratings sourced from Zacks Investment Research.
Tool provided by Kapitall.
Do you think these stocks pay reliable dividends? Use this list as a starting point for your own analysis.
List sorted by decrease in shares shorted as a percent of share float.
1. FXCM Inc. (FXCM): Provides online foreign exchange trading and related services to retail and institutional customers Worldwide. Market cap at $260.61M, most recent closing price at $12.41. Dividend yield at 2.04%, payout ratio at 31.68%. P/FCF at 4.51. Shares shorted have decreased from 3.63M to 2.64M over the last month, a decrease which represents about 5.62% of the company's float of 17.63M shares. Days to cover ratio at 12.48 days.
2. GameStop Corp. (GME): Operates as a retailer of video game products and personal computer entertainment software. Market cap at $2.31B, most recent closing price at $17.74. Dividend yield at 3.27%, payout ratio at 6.20%. P/FCF at 5.57. Shares shorted have decreased from 59.92M to 54.16M over the last month, a decrease which represents about 4.5% of the company's float of 128.09M shares. Days to cover ratio at 15.65 days.
3. ManTech International Corporation (MANT): Provides technologies and solutions for national security programs in the United States and internationally. Market cap at $834.9M, most recent closing price at $22.62. Dividend yield at 3.58%, payout ratio at 30.42%. P/FCF at 5.19. Shares shorted have decreased from 3.04M to 2.77M over the last month, a decrease which represents about 1.14% of the company's float of 23.70M shares. Days to cover ratio at 10.32 days.
*Short data sourced from Yahoo! Finance, all other data sourced from Finviz.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.