Although dividend investments can be considered a practical, and sometimes slower route to wealth accumulation, there is still room for excitement. That is especially true when a company looks primed for growth. Today we focused on dividend stocks that have high projected earnings in their forecast. We only included companies that have reported considerable levels of profitability. Take a look to see if any of these companies are calling your name.
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
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. The 1-Year Expected EPS Growth Rate is an annual growth estimate, where the growth projections are made by analysts, the company or other credible sources.
We first looked for dividend stocks. We then looked for businesses that have strong profitability relative to their asset base (ROA [TTM]>10%)(Net Margin [TTM]>10%). We then looked for companies that have expected earnings per share growth of more than 25 percent for next year(1-year projected EPS Growth Rate>25%). We did not screen out any market caps or sectors.
Do you think these stocks are in strong positions for future growth? Use our screened list as a starting point for your own analysis.
1) Freeport-McMoRan Copper & Gold Inc. (FCX)
Freeport-McMoRan Copper & Gold Inc. has a Dividend Yield of 3.73%, a Payout Ratio of 33.70%, a Return on Assets of 12.61%, a Net Margin of 21.98%, and a 1-Year Projected Earnings Per Share Growth Rate of 41.76%. The short interest was 2.68% as of 08/04/2012. Freeport-McMoRan Copper & Gold Inc. engages in the exploration, mining, and production of mineral resources. The company primarily explores for copper, gold, molybdenum, cobalt hydroxide, silver, and other metals, such as rhenium and magnetite. It holds interests in various mines located in the Grasberg minerals district in Indonesia; Morenci minerals district in North America; South America; and Tenke Fungurume minerals district in the Democratic Republic of Congo.
2) Tesoro Logistics LP (TLLP)
|Industry:||Oil & Gas Pipelines|
Tesoro Logistics LP has a Dividend Yield of 4.25%, a Payout Ratio of 49.70%, a Return on Assets of 29.45%, a Net Margin of 44.53%, and a 1-Year Projected Earnings Per Share Growth Rate of 35.80%. The short interest was 0.22% as of 08/04/2012. Tesoro Logistics LP engages in the ownership, operation, development, and acquisition of crude oil and refined products logistics assets in the United States. The company is involved in the gathering, terminalling, transportation, and storage of crude oil and refined products. Its assets consist of a crude oil gathering system in the Bakken Shale/Williston Basin area of North Dakota and Montana; eight refined products terminals in the midwestern and western United States; a crude oil and refined products storage facility; and five related short-haul pipelines.
3) James Hardie Industries SE (JHX)
James Hardie Industries SE has a Dividend Yield of 16.87%, a Payout Ratio of 30.37%, a Return on Assets of 28.30%, a Net Margin of 48.83%, and a 1-Year Projected Earnings Per Share Growth Rate of 41.53%. The short interest was 0.02% as of 08/04/2012. James Hardie Industries SE, together with its subsidiaries, manufactures and sells fiber cement products for interior and exterior building construction applications primarily in the United States, Canada, Australia, New Zealand, the Philippines, and Europe. Its products principally include fiber cement interior linings, exterior siding products, and related accessories products. The company offers fiber cement products with various patterned profiles and surface finishes for a range of applications, including external siding and soffit lining, internal linings, facades, floor and tile underlay, lattice, fencing, decorative columns, flooring, and ceiling applications; and manufactures and sells fiber reinforced concrete pipes.
4) Oiltanking Partners, L.P. (OILT)
|Industry:||Oil & Gas Pipelines|
Oiltanking Partners, L.P. has a Dividend Yield of 4.21%, a Payout Ratio of 51.16%, a Return on Assets of 23.12%, a Net Margin of 58.10%, and a 1-Year Projected Earnings Per Share Growth Rate of 46.07%. The short interest was 0.52% as of 08/04/2012. Oiltanking Partners, L.P. provides storage, terminaling, and transportation services for third-party companies engaged in the production, distribution, and marketing of crude oil, refined petroleum products, and liquefied petroleum gas. The company operates a crude oil and refined petroleum products terminal on the Houston Ship Channel with an aggregate active storage capacity of approximately 11.7 million barrels (mmbbls).
*Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.