May's 50 Top Proven Dividend Winners By Yield And Net Gains

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Includes: ANDX, APU, CHS, DKL, EQM, ET, GEO, GLOP, MPLX, NEWM, NRZ, PBFX, SRLP, VGR, WES, WLKP
by: Fredrik Arnold
Summary

Top Proven Dividend Winners are companies that have increased dividends every year for 5-49 consecutive years and whose annual dividend from $1k invested exceeds the single share stock price.

187 Top Proven Underdog stocks represent all eleven Morningstar Sectors. Broker target top-ten net gains ranged 20.1%-50.4% topped by Energy Transfer 5/16/19.

By yield, Vector Group topped all Top Proven Dividend Winners. Top ten yields from EQM, PBFX, DKL, GLOP, APU, ANDX, NRZ, SRLP, NEWM, & VGR averaged 12.11%.

Top ten Proven Dividend Winners by broker target-price upsides, MPW, HPT, PBFX, NRZ, PSXP, SIX, GEO, WLKP, MPLX, & GLOP, averaged 94.41%.

5k invested in the lowest-priced five May top-yield Top Proven Dividend Winners showed 11.89% LESS net gain than from $5k invested in all ten. High price bib dogs lead the pack.

Actionable Conclusions (1-10): Brokers Predicted 11.7% To 37.9% Net Gains To May 2020

Five of the ten Top Proven Dividend Winners by yield were verified as being among the top ten gainers for the coming year based on analyst 1-year target prices. (They are tinted gray in the chart below). Thus, our yield-based forecast for the Top Proven Dividend Winners, graded by Wall St. wizards, was 50% accurate.

Projections, based on estimated dividend returns from $1,000 invested in each of the highest yielding stocks and their aggregate one-year analyst median target prices, as reported by YCharts, created the 2019-20 data points. Note: one-year target prices by lone analysts were not applied. Ten probable profit-generating trades projected to May 16, 2019 were:

Source: YCharts.com

Energy Transfer LP (ET) was projected to net $504.25 based on dividends, plus a median target estimate from eighteen brokers, less transaction fees. The Beta number showed this estimate subject to volatility 72% more than the market as a whole.

Chico's FAS Inc (CHS) was projected to net $335.26, based on dividends, plus a mean target price estimate from nine analysts, less broker fees. The Beta number showed this estimate subject to volatility 23% more than the market as a whole.

Western Midstream Partners (WES) was projected to net $309.40 based on dividends, plus median target price estimates from eleven analysts, less broker fees. The Beta number showed this estimate subject to volatility 54% more than the market as a whole.

The GEO Group Inc (GEO) was projected to net $308.51, based on dividends, plus a mean target price estimate from two analysts, less broker fees. The Beta number showed this estimate subject to volatility 57% more than the market as a whole.

MPLX LP (MPLX) was projected to net $301.48, based on a median target price estimate from fourteen analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to volatility 27% more than the market as a whole.

Westlake Chemical (WLKP) was projected to net $295.96, based on a median of target estimates from six analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to volatility 40% less than the market as a whole.

PBF Logistics LP (PBFX) was projected to net $274.80, based on a median target price estimate from six analysts, plus the estimated annual dividend, less broker fees. The Beta number showed this estimate subject to volatility 19% less than the market as a whole.

GasLog Partners LP (GLOP) was projected to net $230.56 based on dividends, plus a mean target price estimate from thirteen analysts, less broker fees. The Beta number showed this estimate subject to volatility 19% over the market as a whole.

New Residential Investment (NRZ) was projected to net $226.98, based on target price estimates from nine analysts, plus annual dividend, less broker fees. The Beta number showed this estimate subject to volatility 9% more than the market as a whole.

EQM Midstream Partners (EQM) netted $200.98 based on a median target price estimate from fourteen analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to volatility 11% more than the market as a whole.

The average net gain in dividend and price was estimated to be 29.88% on $10k invested as $1k in each of these ten stocks. This gain estimate was subject to average volatility 21% more than the market as a whole.

Source: pinterest.com

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." More precisely, these are, in fact, best called, "underdogs", even if they are "Top Proven Dividend Winners."

50 Top Proven Dividend Winners By Broker Targets

Source: YCharts

This scale of broker estimated upside (or downside) for stock prices provides a scale of market popularity. Note: no broker coverage or 1 broker coverage produced a zero score on the above scale. It can be taken as an emotional component as opposed to the strictly monetary and objective dividend/price yield-driven report below.

50 Top Proven Dividend Winners By Yield

Source: YCharts

Actionable Conclusions (11-20): 10 Top Proven Dividend Winners By Yield

Top Proven Dividend Winners ten stocks selected 5/16/19 by yield represented five of eleven Morningstar sectors. Top yielding stock was the lone consumer defensive representative, Vector Group Ltd. (VGR) [1]. Second place was secured by the lone consumer cyclical representative, New Media Investment Group Inc. (NEWM) [2].

Third place went to the first of six energy representatives, Sprague Resources LP (SRLP) [3]. The other five energy dogs placed fifth, and seventh through tenth: Andeavor Logistics LP (ANDX) [5]; GasLog Partners LP [7]; Delek Logistics Partner (DKL) [8]; PBF Logistics LP [9]; EQM Midstream Partners LP [9].

A lone real estate representative placed fourth, New Residential Investment Corp. [4], and finally, a single utilities firm placed sixth, AmeriGas Partners LP (APU) [6], to complete the ten Top Proven Dividend Winners by yield for May.

Source: YCharts.com

Actionable Conclusions: (21-30) Ten Top Proven Dividend Winners Showed 12.18% To 44.20% Upsides To May 2020; (31) Downsides Projected From Four Losers Ranged -0.6% To -6.93%

To quantify top yield rankings, analyst mean price target estimates provided a "market sentiment" gauge of upside potential. Added to the simple high-yield metrics, analyst median price target estimates became another tool to dig out bargains.

Analysts Estimated An 11.89% Disadvantage For 5 Highest Yield, Lowest Priced Top Proven Dividend Winners To May 2020

Ten top Proven Dividend Winners were culled by yield for their monthly update. Yield (dividend/price) results verified by YCharts did the ranking.

Source: YCharts.com

As noted above, top ten Top Proven Dividend Winners selected 5/16/19 showing the highest dividend yields represented five of eleven in the Morningstar sector scheme.

Actionable Conclusions: Analysts Projected The 5 Lowest-Priced of the Top Ten Highest-Yield Top Proven Dividend Winners (32) Delivering 16.51% Vs. (33) 18.06% Net Gains by All Ten by May 2020

Source: YCharts.com

$5,000 invested as $1k in each of the five lowest-priced stocks in the top ten Top Proven Dividend Winners by yield were predicted by analyst 1-year targets to deliver 11.89% LESS gain than $5,000 invested as $.5k in all ten. The seventh lowest priced Top Proven Dividend Winners top yield stock, Delek Logistics Partners LP, was projected to deliver the best net gain of 30.85%.

Source: YCharts.com

The five lowest-priced top yield Top Proven Dividend Winners for May 16 were: Vector Group Ltd., New Media Investment Group Inc., New Residential Investment Corp., Sprague Resources LP, and PBF Logistics LP, with prices ranging from $9.51 to $20.01

Five higher-priced Top Proven Dividend Winners as of May 16 were: GasLog Partners LP, Delek Logistics Partners LP, AmeriGas Partners LP, Andeavor Logistics LP, and EQM Midstream Partners LP, whose prices ranged from $21.27 to $46.15.

This distinction between five low-priced dividend dogs and the general field of ten reflected Michael B. O'Higgins' "basic method" for beating the Dow. The scale of projected gains based on analyst targets added a unique element of "market sentiment" gauging upside potential. It provided a here-and-now equivalent of waiting a year to find out what might happen in the market. Caution is advised, since analysts are historically only 20% to 80% accurate on the direction of change and just 0% to 20% accurate on the degree of change.

The net gain/loss estimates above did not factor in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.

Stocks listed above were suggested only as possible reference points for your Top Proven Dividend Winners stock purchase or sale research process. These were not recommendations.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.indexarb.com; YCharts.com; finance.yahoo.com; analyst mean target price by Thomson/First Call in YahooFinance. Dog photo: rover.com

Disclosure: I am/we are long T. 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.