Seeking Alpha
Value, growth, long-term horizon, medium-term horizon
Profile| Send Message| ()  

Do you consider a stock's sales trends when comparing names? For ideas on how to start your own sales analysis, we ran a screen.

We began by screening for "dividend champion" stocks, those listed by DRiP Investing as those that have consistently increased their dividends over the last 25 years. We also screened for those paying dividend yields above 2% and sustainable payout ratios below 50%.

We then screened for strong sales trends by comparing growth in revenue to growth in inventory over the last year. We screened for stocks with positive sales trends, with faster growth in revenue than inventory over the last year. Since inventory represents the portion of goods not yet sold, faster growth in revenue than inventory is considered an encouraging sign.

To screen for strengthening liquidity, we also only focused on those companies with inventory decreasing as a percent of current assets.

For an ‪interactive version of this chart, click on the image below. Analyst ratings sourced from Zacks Investment Research.‬

(click to enlarge)

Tool provided by Kapitall. More investing ideas on Kapitall Wire.

Do you think these stocks will continue to pay reliable dividends? Use this list as a starting point for your own analysis.

List sorted by increase in revenue over the last year.

1. Diebold, Incorporated (DBD): Provides integrated self-service delivery and security systems and services primarily to the financial, commercial, government, and retail markets worldwide. Market cap at $2.06B, most recent closing price at $32.31. Dividend yield at 3.49%, payout ratio at 36.74%. Revenue grew by 12.2% during the most recent quarter ($743.19M vs. $662.38M y/y). Inventory grew by -2.17% during the same time period ($486.09M vs. $496.86M y/y). Inventory, as a percentage of current assets, decreased from 27.75% to 26.99% during the most recent quarter (comparing 3 months ending 2012-06-30 to 3 months ending 2011-06-30).

2. Mine Safety Appliances Co. (MSA): Develops, manufactures, and supplies health and safety products used by workers in the fire service, homeland security, construction, and other industries, as well as the military. Market cap at $1.31B, most recent closing price at $35.20. Dividend yield at 3.16%, payout ratio at 44.25%. Revenue grew by 2.4% during the most recent quarter ($303M vs. $295.89M y/y). Inventory grew by -13.44% during the same time period ($143.67M vs. $165.98M y/y). Inventory, as a percentage of current assets, decreased from 32.72% to 29.72% during the most recent quarter (comparing 3 months ending 2012-06-30 to 3 months ending 2011-06-30).

3. Colgate-Palmolive Co. (CL): Manufactures and markets consumer products worldwide. Market cap at $49.73B, most recent closing price at $104.75. Dividend yield at 2.36%, payout ratio at 46.06%. Revenue grew by 1.96% during the most recent quarter ($4,267M vs. $4,185M y/y). Inventory grew by -3.46% during the same time period ($1,368M vs. $1,417M y/y). Inventory, as a percentage of current assets, decreased from 31.7% to 28.29% during the most recent quarter (comparing 3 months ending 2012-06-30 to 3 months ending 2011-06-30).

4. Illinois Tool Works Inc. (ITW): Manufactures a range of industrial products and equipment worldwide. Market cap at $26.98B, most recent closing price at $56.36. Dividend yield at 2.55%, payout ratio at 35.93%. Revenue grew by 0.87% during the most recent quarter ($4,655M vs. $4,614.91M y/y). Inventory grew by -6.44% during the same time period ($1,796M vs. $1,919.68M y/y). Inventory, as a percentage of current assets, decreased from 25.4% to 23.78% during the most recent quarter (comparing 3 months ending 2012-06-30 to 3 months ending 2011-06-30).

*Accounting data sourced from Google Finance, all other data sourced from Finviz.

Source: 4 Dividend Champions With Strong Inventory Trends