Ranking My Portfolio On Yield, DPR, Chowder Number And Discount Rate
Earlier this week I discussed several ranking formulas for the stocks on my watchlist, to help me pick the stock for my next purchase. I created a new ranking formula that combines dividend yield and DPR:YDPR = 10 * Yield + (1 - DPR)I call this the Yield plus Inverted DPR rank, or YDPR for short. The YDPR value measures the chance that the stock will raise its dividend, based on current yield and net income. A YDPR value above 0.8 is great and indicates a stock with high yield and low DPR, with lots of room for future dividend growth. A value below 0.45 indicates a low yield or a "maxed out" DPR.I also looked at the ChowderDiscount rank, which is simply the sum of the Chowder number and the Discount rate:ChowderDiscount = 2 * Yield + EPS growth + DPS growthThe ChowderDiscount rank measures the chance that the stock will raise its dividend, based on current yield and historic earnings and dividend growth. A ChowderDiscount value of 0.22 or more indicates a high yield with lots of past dividend and earnings growth. A number below 0.19 means a low yield combined with either low dividend or low earnings growth.I combined the two metrics together into a new unified rank:R = 12 * Yield + EPS growth + DPS growth + (1 - DPR)After sorting my watchlist by unified rank, I discovered that BMW (OTCPK: BAMXY) was the best candidate for my next purchase.But what happens when I apply the new ranking formula to my portfolio? The last time I attempted to rank my portfolio I identified... Read more