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August Contender Dogs: Energy Sector Lives Here

Aug. 05, 2016 7:45 PM ETAPU, DCP, EPD, ET, GEL, WELL, HEP, MMP, MUR, NHI, OKE, PAA, MTB, SEP, STON, TCP, TLP, VGR, WMB6 Comments


  • Ten top yielding Contenders (ETE; TCP; VGR; APU; OKS; GEL; DPM; PAA; WMB; STON) revealed annual yields averaging 8.53% and charged bullishly as Dow dogs mixed down through July.
  • 50 Contenders (with 10 to 24 years of regular dividend hikes) ranged in yield from 3.47% to 10.55% as of August 5 closing prices.
  • Analyst 1yr. targets predicted average 5.2% upside and 9.8% gains from thirty Contenders. SEP, TCP, MMP, PAA, TLP, HEP, MUR, EPD, GEL, & STON posted gains of 13.8% to 36.45%.
  • Three Contenders cast analyst estimated downsides of 2.3% to 7.7%: HCN; PBCT; NHI.
  • Analysts recorded 12.94% more net gain from $5k invested in the lowest priced five of ten top yielding August Contender dogs than from the same investment in all ten.

The Dividend Dogs Rule

Stocks earned the "dog" moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs."

Contender Dogs Are Loaded With Energy

David Fish's Dividend Contenders closing prices August 4 were paired with annual dividends projected by dripinvesting.org as of July 29. That data (charted below) showed four of nine Yahoo business sectors represented by top ten Contenders by yield: basic materials (7), services (1), utilities (1), and consumer goods (1). In the Morningstar scheme of eleven sectors, four were covered: energy (7); utility (1); consumer cyclical (1); consumer defensive (1). These top ten stocks posted yields from 7.06% to 10.55%.

Actionable conclusions by yield, target price upsides and net gains were drawn below as top Contender dogs for August were discussed, step by step. Energy dogs carried the load.

Actionable Conclusion (1) 10 Contender Dogs Yield as of August 10 Averaged 8.53%

Seeking Alpha reader requests prompted this series of index-specific articles reporting dividend yield plus price upside results for these indices: Dow 30; S&P 500; S&P Aristocrats; NASDAQ 100; Russell 1000; Russell 2000; Champions; Contenders; Challengers; CCC Combined; and Global. Bonus reports cover Bad Boy AllStars, and Sector Leaders.

Fifty For Money

This article was written to reveal bargain dividend stocks to buy and hold up to one full year. See Dow 30 article for explanation of the term "dogs" for stocks reported based on Michael B. O'Higgins book "Beating The Dow" (HarperCollins, 1991). Now named Dogs of the Dow, O'Higgins system works to find bargains in any collection of dividend paying stocks. Utilizing analyst price upside estimates has expanded the stock universe to include popular growth

This article was written by

Fredrik Arnold profile picture
Simple, straightforward 7-step analysis that finds lucrative income stocks.
Fredrik Arnold is my pen name. In 2012 I retired from doing quality service analysis in Boston and moved to North Carolina in 2013, thence to Central Oregon in 2018. My fascination with capital preservation, long-term investments, and trading systems keeps me blogging for Seeking Alpha. My articles focus on dividend yields, analyst median 1 yr targets, free cash flow yields, and one-year total returns as stock trading indicators. These are essential tools for catching the most valuable dividend dogs. My dividend dogcatcher premium site in the Seeking Alpha Marketplace shows annual real-time trading results since 2015.

Analyst’s Disclosure: I am/we are long CSCO, PFE, VZ. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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