11 Quality Dividend Value Investing Opportunities Near New Lows

It was a good week for the market as the S&P 500 roared back 1.75%. The Dow did even better and closed at 12,657, up 1.95% for the week. Our watch list now contains 30 companies within 11% of their respective 52-week lows. The complete list can be found here. July 8, 2011 Watch List Symbol Name Price % Yr Low P/E EPS Dividend Yield Payout Ratio CMA Comerica, Inc. 33.79 2.15% 18.57 1.82 0.40 1.18% 22% NTRS Northern Trust Corp. 45.87 2.89% 16.93 2.71 1.12 2.44% 41% BXS BanCorp.South Inc. 12.01 3.80% 75.06 0.16 0.04 0.33% 25% GS Goldman Sachs 134.08 ... more

6 Safe Dividend Stocks With Strong Value Characteristics

When investing for income, it is of course necessary to look beyond dividend yield at the underpinnings of the dividend and the company itself. Is the dividend secure for the short term? Will future cash flows cover stable, or even increased dividend payments? And is there a possibility of principal appreciation in addition to our income?The following list offers 6 profitable companies with little or no debt, strong cash positions, and solid dividend yields. These companies appear undervalued on an enterprise basis and thus, not only provide security of income, but a real chance for capital appreciation. 1. American Eagle Outfitters (AEO) Closing Price 7/8: $13.88 Dividend Yield: 3.17% AEO has had a nice bounce off of 10-month lows set in June, pushing up about 10%, thanks... more

Tax Gain Harvesting: Don't Forget about 0% on Cap Gains and Qualified Dividends

Yes, you read that correctly. When it comes to investing, there aren’t many times when zero is the number you’re hoping to see. However, when it comes to paying taxes on your investments, it doesn’t get much better. Near the end of each year, we tend to talk a lot about tax loss harvesting. It’s a popular use of ETFs, where an investor sells an underperforming stock or fund at a loss, buys an ETF with a similar exposure and risk profile, and holds the ETF for the 30 day “wash sale” period during which they’re prohibited from re-purchasing the original security in order to claim the loss for tax purposes. The strategy is designed to capture the capital loss and possibly lower taxes for the year, while maintaining exposure to the intended security or asset class. (By the way,... more

Investing in Dividend Aristocrats (Part 1)

The S&P 500 Dividend Aristocrats Index is a very prestigious and popular index among dividend investors. The Index measures the performance of blue-chip S&P 500 companies that have increased their dividends for at least 25 consecutive years. The large-cap companies in this index must also have an average daily trading volume of at least $5 Million for the six months prior to the index reference date. In a previous article, we have already indicated that the Dividend Aristocrats Index beat the S&P 500 index over the past 1, 3, 5 and 7 years. Since the beginning of 2011, the companies in the S&P 500 Dividend Aristocrats Index returned 9.44 % vs. 7.60% gain for the SPY. Average dividend pay-out ratio of all 42 stocks in the S&P 500 Dividend Aristocrats Index is 42%, while the average... more

Is Windstream's Dividend Safe?

Here, we'll highlight a given company and its closest competitors to see just how safe their dividends are, with a little help from three crucial tools: The interest coverage ratio, or earnings before interest and taxes, divided by interest expense. The interest coverage ratio measures a company's ability to pay the interest on its debt. An interest coverage ratio less than 1.5 is questionable; a number less than 1 means that the company is not bringing in enough money to cover its interest expenses. The EPS payout ratio, or dividends per share divided by earnings per share. The EPS payout ratio measures the percentage of earnings that go toward paying the dividend. A ratio greater than 80% is worrisome. The FCF payout ratio, or dividends per share divided by free cash... more

You Won't Find These Stocks in Dividend ETFs

The dividend differenceAt first glance, you might think that dividend ETFs would be pretty much identical. To a large extent, that turns out to be correct. The Vanguard High Dividend Yield ETF includes mega-caps Chevron and Coca-Cola near the top of its holdings list, as does Vanguard's other dividend ETF, Vanguard Dividend Appreciation. And while the SPDR S&P Dividend and iShares Select Dividend ETFs have some smaller companies in their top 10 holdings, they largely share the same holdings as their peers. But when you look closely at the entire portfolios of these ETFs, what you'll find most startling isn't what you see but rather what you don't see. Dividend ETFs have some glaring omissions that many dividend investors will want to remedy on their own. Let's take a look at what stocks... more

6 High Dividend Yield Stocks With Strong Sources of Profitability

If you are looking for sources of dividend income, keep in mind that dividends are not a guarantee of future payments. Therefore, company analysis is important to determine whether the current dividend yield will stick around. One way to analyze company profitability is by using DuPont analysis of return on equity (ROE). ROE can be broken up into three components such that changes in ROE can be attributed to those components. ROE = (Net Profit/Equity) = (Net profit/Sales)*(Sales/Assets)*(Assets/Equity) = (Net Profit margin)*(Asset turnover)*(Leverage ratio) Analyzing the sources of returns for a company, we can focus on companies with the following characteristics: Increasing ROE along with, • Decreasing leverage, i.e. decreasing Asset/Equity ratio • Improving asset use... more

The Brink’s Company Board of Directors Declares Regular Quarterly Dividend

The board of directors of The Brink’s Company (NYSE: BCO) declared a regular quarterly dividend of 10 cents per share on its common stock. The dividend is payable on September 1, 2011, to shareholders of record on July 19, 2011.... more

The 3 High-Yield Dividend Stocks I'm Buying Next

Read on to get the names of those three stocks, and I'll also give you the opportunity to download a special free report from The Motley Fool. High yields = high total returnIt feels good to buy dividend stocks -- it's the security of having income pouring in year after year regardless of whether the market bids your stock up (though that's great, too). But the academic literature also suggests that high-yield dividend payers -- exactly like the three names I'm about to reveal -- are strongly correlated with attractive total returns, to paraphrase the Tweedy, Browne report that summarized the findings.... more

2 Dividend Stocks to Buy, 5 to Throw Away

If anyone had a doubt about the power of dividends, they need only read Jeremy Siegel's The Future for Investors, where he writes: "Dividends matter a lot. Reinvesting dividends is the critical factor giving the edge to most winning stocks in the long run." An important metric for dividendsThe consumer goods sector has several stocks that pay huge dividends. Today I'm going to introduce you to two of the highest-paying ones that are worth your consideration -- and five that should be thrown out with the trash.... more