Are There Any Deals Among The Dividend Champions?
INTRODUCTION
The broader indices have made quite the surge since hitting the recent low back on February 11, 2016. Many investors were expecting a bear market to emerge whereas at this time, the market may be on its way to challenging the old highs. Even this article says that the correction is over and that the market will continue to climb. If that is the case, it may be worth looking at which stocks may still be undervalued. Many investors appreciated my recent article about the fair value of many common dividend growth stocks. I wanted to repeat this exercise, but go over each of the stocks found in David Fish's Dividend Champions, Contenders and Challengers list (found here) to uncover some new stocks that I had never previously considered. I am also answering some readers from my previous article who asked me about specific stocks that I did not cover.
THE VALUATION METHODS
DISCOUNTED CASH FLOW VALUATION
Discounted cash flow [DCF] is the most commonly known valuation tool. The DCF is a valuation method used to estimate the attractiveness of an investment opportunity. Discounted cash flow analysis uses future free cash flow projections and discounts them to arrive at a present value estimate, which is used to evaluate the potential for investment.
BENJAMIN GRAHAM VALUATION FORMULA
The Graham number measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the... Read more