13 Dividend Growth Stocks With Very Little Debt

The goal of dividend investing is to find and buy dividend growth stocks that will continue to raise their dividends. To pay and raise its dividend a company must generate sufficient free cash flow. However, it is not enough to just generate the cash, it has to be available for dividend payments. Many companies generate significant free cash flow, but often that cash is already spoken for in the form of debt obligations. This week I am screening my database for low debt-to-total-capital stocks. Debt includes both long-term and short-term debt. Total capital is a combination of debt and shareholders equity. When you divide debt by total capital a desirable rate is something less than 35%, but I will consider rates up to 50% on a short-term basis. Obviously, this is not a buy list but a... more

Profit From Special Situation Dividend Stocks

Let's get started: 1. Spinoff and new dividend, oh my!El Paso (NYSE: EP) , a diversified natural gas company, is spinning off its exploration and production division. The division produces nearly 800 MMcfe's per day, with 85% of that being natural gas. The yet-to-be-named company will be slightly larger than Petrohawk Energy (NYSE: HK) , which produces an average of 675 MMcfe per day. The real opportunity, though, lies in what will be left after the spinoff.... more

The Most Promising Dividends in Cable and Pay TV Services

Yields and growth rates and payout ratios, oh my! Before we get to those companies, though, you should understand just why you'd want to own dividend payers. These stocks can contribute a huge chunk of growth to your portfolio in good times, and bolster it during market downturns. As my colleague Matt Koppenheffer has noted: "Between 2000 and 2009, the average dividend-adjusted return on stocks with market caps above $5 billion and a trailing yield of 2.5% or better was a whopping 114%. Compare that to a 19% drop for the S&P 500."... more

The 25 Highest-Yielding Stocks

The highest dividend yields can be very tantalizing. As long as a stock yielding 15% doesn't lose value, you'll make 15% in one year! In more cases than not, however, an astronomical yield is a bad sign for a stock. Since dividend yields and stock prices move in opposite directions, a high yield usually means that investors have begun to worry about the business and driven down its stock price. However, certain types of companies such as REITs have to pay out most of their income as dividends, so their yields will be higher than "normal." Dividends are not guaranteed; you need to make sure that a business is generating enough cash to pay its dividend, or your investment could be disastrous.... more

Dividend Scan: LTD, MRCL, HT, TUC, GLDD, TCAP

Several companies declared their future dividend plans despite the U.S. market trading red in the morning session. Some notable dividend payers are discussed here. Limited Brands Inc. (NYSE: LTD) declared a quarterly dividend of 20 cents per share and a special dividend of $1 per share. The quarterly dividend is payable on June 17, 2011, to shareholders of record on June 7, 2011, and the special dividend will be payable on July 1, 2011, to shareholders of record on June 17, 2011. However, shares were down 1.25 percent, or 50 cents, to trade at $39.46. Micrel Inc. (Nasdaq: MRCL) shares fell 0.08 percent, or 1 cent, to trade at $11.76 despite raising its quarterly dividend by 14 percent to 4 cents per share. Hersha Hospitality Trust (NYSE: HT) declared a cash dividend of 50 cents... more

Income Ideas: Small-Cap Stocks With Excellent Dividend Coverage and Insider Buying

Studies continue to show that the best way to mitigate against broad market losses is investing in dividend stocks. A University of Chicago study on the relationship between dividends and earnings found that the fraction of losses reported by non-dividend payers in the U.S. grew from 28% in 1974-1979 to 52% by 2000-2005. Dividend payers followed the same general trend of increasing fraction of losses reported, but in a far lower percentage than non-dividend payers, with losses compromising of 3.5% of dividend payers in 1974-1979 to 11% in 2000-2005 (but this percentage of losses has been more or less consistent since 1985-1989).... more

5 Dividend Stocks In Need Of A Market Correction

We have all heard that trees don't grow to the sky, but that seems to be what is happening in this bull market that started back in early 2009. When investors see their portfolio dramatically increase in value, it leaves them with a sense of accomplishment. However, if you are an investor in dividend growth stocks, a higher portfolio may not be in your best interest. Consider the following... Higher Values, Lower Yields One of my favorite comments from the unenlightened is, 'How could you buy XYZ stock? Its price has been flat for over 10 years!' If a company has increasing earnings, cash flow and dividends for 10 years, and there is nothing fundamentally wrong with the company, I am ecstatic if the stock price is flat. When this occurs the shares purchased today will have a... more

The 25 Highest-Yielding MLPs

One particular area has garnered interest over the years are master limited partnerships. Investors are drawn to MLPs for their high yields and tax deferral. MLPs don't pay taxes at the corporate level, so the tax burden then gets passed to the investor. Without getting into too much detail, because of structure of the partnerships and the distributions, investors are entitled to a serious tax deferral. Investors should fully understand what they are in for before buying MLPs, but for those willing to do the research it can be very profitable. The highest yields can be very tantalizing. As long as a stock yielding 15% doesn't lose value, you'll make 15% in one year! In more cases than not, however, an astronomical yield is a bad sign for a stock. Since yields and stock prices move in... more

Erie Indemnity: Dividend Dynamo or Blowup?

Let's examine how Erie Indemnity (Nasdaq: ERIE) stacks up in four critical areas to determine whether it's a dividend dynamo or a disaster in the making. 1. YieldFirst and foremost, dividend investors like a large yield. But if a yield gets too high, it may reflect investors' doubts about the payout's sustainability. If investors had confidence in the stock, they'd be buying it, driving up the share price and shrinking the yield.... more

Aflac: Dividend Dynamo or Blowup?

Let's examine how Aflac (NYSE: AFL) stacks up in four critical areas to determine whether it's a dividend dynamo or a disaster in the making. 1. YieldFirst and foremost, dividend investors like a large yield. But if a yield gets too high, it may reflect investors' doubts about the payout's sustainability. If investors had confidence in the stock, they'd be buying it, driving up the share price and shrinking the yield.... more