Linked here is a detailed quantitative analysis of Sysco Corporation (SYY). Below are some highlights from the above linked analysis:
Company Description: Sysco Corporation is a large distributor of food and related products, primarily to the foodservice or food-away-from-home industry. [more]
Linked here is a detailed quantitative analysis of Procter & Gamble (PG). Below are some highlights from the above linked analysis: [more]
Are you confident and secure in your investing process? It is my firm belief that most investors will lose money in the stock market over their lifetime. It is not that the market is a bad place to invest your money, but left unchecked the psychology of the market will lead you to do just the opposite of what you should to be doing. [more]
General Mills (GIS) has one of the longest dividend histories in corporate America. The company and its predecessor firm have paid shareholder dividends, without interruption or reduction, for 113 years. With the latest dividend boost announced Tuesday, the company extended its streak of consecutive increases to nine years. [more]
Medtronic, Inc. (MDT) manufactures and sells device-based medical therapies worldwide. June 21st the company increased its quarterly dividend 7.2% to $0.26 per share. MDT's dividend has more than doubled over the past five years, and this announcement marks the company's 35th consecutive year of increased dividend payments. The dividend is payable on July 27, 2012, to shareholders of record at the close of business on July 6, 2012. The yield based on the new payout is 2.8%. [more]
Linked here is a detailed quantitative analysis of Abbott Laboratories (ABT). Below are some highlights from the above linked analysis:
Company Description: Abbott Laboratories is a diversified life science company that is planning to split into two publicly traded companies, one in diversified medical products and the other in research-based pharmaceuticals. [more]
Linked here is a detailed quantitative analysis of The Clorox Company (CLX). Below are some highlights from the above linked analysis:
Company Description: The Clorox Company is a diversified producer of household cleaning, grocery and specialty food products is also a leading producer of natural personal care products. [more]
Walgreen Co. (WAG) operates a chain of drugstores in the United States. WAG has never been shy when it comes to increasing it dividend. It has provided double-digit increases every year since 2003. With a yield below 3%, the increases are what attracted dividend growth investors. However, after today's increase, there may be a new class of investors looking at the stock. [more]
Quantitative easing (QE), it is such a benign sounding term. It is somewhat relaxing rolling off your lips. Unfortunately, this rose has thorns. QE in simple terms is the government printing money and buying financial assets (e.g. bonds, etc.) in an effort to stimulate the economy. A side effect of QE is higher prices of the financial assets bought, which in turn lowers their yield. [more]
United Technologies Corporation (UTX) provides technology products and services to the building systems and aerospace industries worldwide. June 13th the company increased its quarterly dividend 11.5% to $0.535 cents per share. The dividend is payable Sept. 10 to shareowners of record at the close of business Aug. 17. The ex-dividend date is Aug. 15. The yield based on the new payout is 2.9%. [more]
The Pocket Change Portfolio (PCP) was first introduced on September 13, 2008 as a real money dividend income portfolio funded by the "pocket change" earned from my various online endeavors. Each month I report on the portfolio's progress and update its holdings. [more]
Linked here is a detailed quantitative analysis of Southside Bancshares Inc. (SBSI). Below are some highlights from the above linked analysis:
Company Description: Southside Bancshares Inc. owns Southside Bank, which primarily provides financial services to individuals, businesses, municipal entities, and non-profit organizations. [more]
As the world's largest retailer, Wal-Mart (WMT) is not used to being the one bullied. Its new competition is not coming from the retail side, but instead it is coming from the financial side. Specifically, Wal-Mart, who has led the way among major retailers in dividend yield, is starting to get some real competition from Target (TGT). [more]
Linked here is a detailed quantitative analysis of Automatic Data Processing Inc. (ADP). Below are some highlights from the above linked analysis:
Company Description: Automatic Data Processing Inc., one of the world's largest independent computing services companies, provides a broad range of data processing services. [more]
Dell announced late Tuesday that it was joining the growing ranks of tech companies that pay a dividend. Microsoft (MSFT), Intel (INTC), Oracle (ORCL) and Cisco (CSCO) all pay quarterly dividends, and Apple (AAPL) announced earlier this year it will join the group. [more]
All dividend growth stocks are not created equal. Good companies maintain their dividends during a downturn (like the one we experienced in 2008); while great companies continue to increase their dividends during a downturn. To find these great companies, you will need to focus on more than just yield. You need to consider the stock's Free Cash Flow Payout. [more]
Universal Health Realty Income Trust (UHT) operates as a real estate investment trust (REIT) that invests in health care and human service related facilities. June 7th the company increased its quarterly dividend 0.8% to $0.615 per share. The dividend is payable June 29, 2012 to shareholders of record as of June 18, 2012. The yield based on the new payout is 6.3%. [more]
Once again it is time for a goals/progress update. I am pleased to report that annualized dividend income increased in May, extending the streak to 23 consecutive months of increases after June 2010's decline. Since I began publicly tracking annualized dividend income in November 2007, it has increased in 52 of the last 54 months. [more]
Linked here is a detailed quantitative analysis of International Business Machines Corp. (IBM). Below are some highlights from the above linked analysis:
Company Description: IBM's global capabilities include information technology services, software, computer hardware equipment, fundamental research, and related financing.
Fair Value: In calculating fair value, I consider the NPV MMA Differential Fair Value along with these four calculations of fair value, see page 2 of the linked PDF for a detailed description:
1. Avg. High Yield Price
2. 20-Year DCF Price
3. Avg. P/E Price
4. Graham Number
IBM is trading at a discount to only 2.) above. Since IBM's tangible book value is not meaningful, a Graham number can not be calculated. The stock is trading at a slight premium to its calculated fair value of $188.19. IBM did not earn any Stars in this section.
Dividend Analytical Data: In this section there are three possible Stars and three key metrics, see page 2 of the linked PDF for a detailed description:
1. Free Cash Flow Payout
2. Debt To Total Capital
3. Key Metrics
4. Dividend Growth Rate
5. Years of Div. Growth
6. Rolling 4-yr Div. > 15%
IBM earned two Stars in this section for 1.) and 3.) above. A Star was earned since the Free Cash Flow payout ratio was less than 60% and there were no negative Free Cash Flows over the last 10 years. IBM earned a Star for having an acceptable score in at least two of the four Key Metrics measured.
Rolling 4-yr Div. > 15% means that dividends grew on average in excess of 15% for each consecutive 4 year period over the last 10 years (2002-2005, 2003-2006, 2004-2007, etc.) I consider this a key metric since dividends will double every 5 years if they grow by 15%. The company has paid a cash dividend to shareholders every year since 1916 and has increased its dividend payments for 17 consecutive years.
Dividend Income vs. MMA: Why would you assume the equity risk and invest in a dividend stock if you could earn a better return in a much less risky money market account (MMA) or Treasury bond? This section compares the earning ability of this stock with a high yield MMA. Two items are considered in this section, see page 2 of the linked PDF for a detailed description:
1. NPV MMA Diff.
2. Years to > MMA
IBM earned a Star in this section for its NPV MMA Diff. of the $2,041. This amount is in excess of the $1,800 target I look for in a stock that has increased dividends as long as IBM has. If IBM grows its dividend at 15.0% per year, it will take 5 years to equal a MMA yielding an estimated 20-year average rate of 3.1%.
Memberships and Peers: IBM is a member of the S&P 500 a member of the Broad Dividend Achievers™ Index. The company's peer group includes: Accenture plc (ACN) with a 2.4% yield, Hewlett-Packard Company (HPQ) with a 2.5% yield, and Microsoft Corporation (MSFT) with a 2.8% yield.
Conclusion: IBM did not earn any Stars in the Fair Value section, earned two Stars in the Dividend Analytical Data section and earned one Star in the Dividend Income vs. MMA section for a total of three Stars. This quantitatively ranks IBM as a 3-Star Hold stock.
Using my D4L-PreScreen.xls model, I determined the share price would need to increase to $199.05 before IBM's NPV MMA Differential decreased to the $1,800 minimum that I look for in a stock with 17 years of consecutive dividend increases. At that price the stock would yield 1.7%.
Resetting the D4L-PreScreen.xls model and solving for the dividend growth rate needed to generate the target $1,800 NPV MMA Differential, the calculated rate is 14.5%. This dividend growth rate is close to the 15.0% used in this analysis, thus providing an insignificant margin of safety. IBM has a risk rating of 1.50 which classifies it as a Low risk stock.
IBM operates in a intensely competitive environment. Its solutions, global market presence and significant economies of scale provide it a distinct advantage. Given its diversity, the company is well positioned to weather future economic storms. IBM's solutions and healthy margin gains will enable the company to deliver steady recurring revenue for a long time. In spite of trading near its calculated fair value of $188.19, its low yield will keep me on the sidelines for now.
Disclaimer: Material presented here is for informational purposes only. The above quantitative stock analysis, including the Star rating, is mechanically calculated and is based on historical information. The analysis assumes the stock will perform in the future as it has in the past. This is generally never true. Before buying or selling any stock you should do your own research and reach your own conclusion. See my Disclaimer for more information.
Full Disclosure: At the time of this writing, I held no position in IBM (0.0% of my Dividend Growth Portfolio). See a list of all my dividend growth holdings here.
- Lowe's Companies, Inc. (LOW) Dividend Stock Analysis
- Intel Corporation (INTC) Dividend Stock Analysis
- Hormel Foods Corp. (HRL) Dividend Stock Analysis
- Johnson & Johnson (JNJ) Dividend Stock Analysis
- More Stock Analysis [more]
Linked here is a detailed quantitative analysis of Hasbro, Inc. (HAS). Below are some highlights from the above linked analysis:
Company Description: Hasbro, Inc. holds a broad portfolio of toys, games and entertainment offerings including brands such as Transformers, Playskool, Monopoly and My Little Pony. [more]
Fad diets and fad investing plans rarely work. They are primarily designed to separate you from your money and make the seller wealthy. Real wealth is built with sweat equity and a sound financial plan. For most people fortunate enough to be born in the U.S., or any other industrialized country, they have access to the two main ingredients to achieve financial success: 1. Opportunity and 2. Time. [more]
Every investor wants to earn more. It is how we define "more" and how we go about earning it that defines the type of investor we are. Income investors want more income. Yield is a significant determinate of income. Instead of buying a current high-yield stock, investors in dividend growth stocks prefer to build their own. Granted, the current yield may never be classified as high-yield, but over time the yield-on-cost can reach epic heights. [more]
Linked here is a detailed quantitative analysis of Lowe's Companies, Inc. (LOW). Below are some highlights from the above linked analysis:
Company Description: Lowe's Companies, Inc. sells retail building materials and supplies, lumber, hardware and appliances through more than 1,700 stores in the U.S. and Canada. [more]