There is no better place to find explosive growth than with low-priced penny stocks. I’m not talking about pink sheet stocks that are potentially nonexistent, or fraudulent names set to crash. I’m talking about real companies with real earnings — companies listed for more than one year on a major exchange like the AMEX, NYSE or Nasdaq, and that have a market cap in the ballpark of $100 million.
The returns can be even more powerful when you combine the power of technology stocks and penny stocks. Specifically, the software space is seeing lots of action thanks to the mass acceptance of smart phones and personal computing devices.
These devices are quite powerful, but they still need programs to make them run. The best software companies are those that make users more productive. In this tough economy, those companies that help workers do more with less are poised to be the penny stocks that really move higher.
Because these companies have the wind at their sails from an earnings perspective, these penny stock prices will not last long. Now is the time to pounce before the rest of the market catches on.
Here are six software penny stocks to buy now:
NetSol
6 Software Penny Stocks to Buy in 2012 - NetSol Technologies (NASDAQ:NTWK) is a penny stock with a near $100 million market cap. This is a real company with real products and real revenues. The company makes application software for the automobile finance and leasing industry as well as the banking, financial services and healthcare industries globally.
Shares have drifted lower since peaking near $2.40 per share earlier this year. You can buy this penny stock today for just $1.60 per share. That is a bargain that you should exploit.
NetSol beat estimates in the last quarter by 4 cents per share. Look for a similar result when it announces quarterly results. For the full year, the expectation is for a profit of 18 cents per share. If the company does better than expected, this stock could really take off.
Cover-All
The penny stock Cover-All Technologies (AMEX:COVR) has a market cap of $63 million and is part of the Russell micro cap index. In May, the stock was listed on the AMEX exchange taking shares off bulletin board status. The stock has gained about 50cents per share since that time.
Cover-All Technologies is in the business of providing software products and services for the property and casualty insurance space. That sector has been getting headlines this year with the uptick in natural disasters and inclement weather. Any chance to save money with technology will be more likely to be advanced under more difficult financial times.
Cover-All is profitable and expected to make seventeen cents per share in the current fiscal year. That number jumps 3 cents to 20 cents per share in 2012. The company has beaten estimates in the last two quarters. You can buy that 17% growth for less than 15 times estimated earnings.
Top Image
One of the problems owning penny stocks is trading volume is thin and liquidity makes it tough to sell shares for a profit. In the case of Top Image Systems (NASDAQ:TISA), we have a stock that sees an average of 300,000 shares trading hands each day. Clearly this stock will be followed by a fairly large group of investors.
Top Image system is in the business of making software with respect to data capture and manipulation. This Israeli-based company was founded in 1991. Shares of the company blasted higher in early May after the company reported positive results for its first quarter of 2011.
In the period, the company saw a 36% increase in revenue and posted a profit of seven cents per share as opposed to a loss in the year prior. That was enough to move the stock from $1.34 per share to $2.20 per share. Those are the types of moves you can expect from a penny stock when it delivers solid operating performance. I expect a repeat performance in future quarters.
Authentidate
6 Software Penny Stocks to Buy in 2012 -Authentidate Holding Corp. (NASDAQ:ADAT) is in the business of making the health care industry less paper-intensive. Offering web-based solutions for health systems and physician groups, this penny stock has nearly doubled in value since early April.
I don’t think the gains are done there. This sort of momentum is what I like to see. Historically riding these waves of momentum has been very lucrative to me and my investors.
Authentidate is growing and continually adding to its impressive roster of customers. Most recently the company signed a deal with the Department of Veteran Affairs to provide telehealth solutions. The company is expected to lose money in 2011, but to be profitable in 2012. If so, the stock will double again from here.
Cinedigm Digital Cinema
Penny stocks can be quite volatile. 6 Software Penny Stocks to Buy in 2012 -Shares of Cinedigm Digital Cinema (NASDAQ:CIDM) have been on a roller coaster this year. In mid-March the stock caught fire and jumped a dollar per share over the course of a couple of months. Since that time, shares have given up half that gain to the ballpark of $1.90 per share.
Use the selling to get in on this penny stock ride. Cinedigm provides technology solutions and digital content to theater exhibitors. The company just completed a year of operating losses that it expects to sharply narrow in the 2012 fiscal year. Sales are growing rapidly and that is what investors should focus on today.
To the extent they beat expectations, profitability may arrive sooner than later.
Mind CTI
6 Software Penny Stocks to Buy in 2012 -Mind CTI (NASDAQ:MNDO) is an Israeli-based technology company that provides convergent end-to-end billing and customer-care product-based solutions for service providers as well as telecom expense management solutions. After peaking at nearly $3.60 per share, the stock has slipped to current levels at $2.80 per share.
The move lower comes on the heels of a less-than-stellar quarterly earnings report for its first quarter ending March 31, 2011. Year over year revenue in the period was lower, but the company did post a profit of six cents per share. In addition to reporting a backlog to be recognized this year of $10.2 million Mind CTI had previously declared a cash dividend of 32 cents per share.
With telecom and wireless being all the rage around the globe, I expect Mind CTI to perform quite well for the remainder of the year.
Showing posts with label best shares to invest in 2012. Show all posts
Showing posts with label best shares to invest in 2012. Show all posts
Top 5 Emerging Growth Stocks to Buy for January in 2012
If you have cash to invest this month, I highly recommend these five below. Here they are, in no particular order:
Taiwan-based Silicon Motion Technology (NASDAQ:SIMO) has its hand in lots of hot markets and is a big player in flash memory storage — flash memory cards, USB flash drives, card readers and solid-state hard drives. In fact, most of the NAND flash and next-generation flash products on the market — whether produced by Samsung (PINK:SSNLF), SanDisk (NASDAQ:SNDK), Toshiba, Micron (NASDAQ:MU) or Intel (NASDAQ:INTC) — are supported by Silicon Motion controllers. Silicon Motion also produces multimedia chips including embedded graphics processors, image processors and TV tuners. Lastly, it has been increasingly focused on controllers for smartphones, tablets and notebook PCs, as well as wireless transceivers for 4G LTE smartphones and tablets.
In the third quarter, Silicon Motion’s sales rose 25% to $63.2 million compared with $50.5 million in the second quarter. Looking forward, the analyst community is expecting annual fourth-quarter sales growth of 51% and 88.9% earnings growth. In the past three months, the analyst community has revised their consensus earnings estimate 32% higher — a phenomenon that typically precedes blowout earnings surprises.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Questor Pharmaceuticals (NASDAQ:QCOR) likes a challenge. As a specialist of difficult-to-treat central nervous system disorders, the company has been particularly successful with its multiple sclerosis treatment, H.P. Acthar Gel. The company also makes Doral, which is used for the treatment of insomnia. In the massive biotechnology industry, Questcor is top-notch in terms of earnings per share growth and return on equity.
For the fourth quarter, the analyst community is expecting 127.4% annual sales growth and 265.7% earnings growth of 38 cents per share. In the past three months, the analyst community has revised their consensus earnings estimate 32.6% higher. Typically, such positive analyst earnings revisions precede future earnings surprises.
Top 5 Emerging Growth Stocks to Buy for January in 2012 -Hansen Natural (NASDAQ:HANS) is the mastermind behind Monster, a dominant energy drink in the U.S. Looking at a can of Monster Energy drink, the flashy staple of sleep-deprived college students, one wouldn’t think that the company’s humble beginnings stem back to just one father and three sons working with a juicer in Southern California. In fact, although Hansen sells supercharged drinks like Monster and Java Monster, most of its drink roster is actually very wholesome. For example, it has 30 real fruit and spice soda flavors, a number of immune system-boosting drinks, vitamin waters and an array of teas and lemonades.
In recent quarters, Hansen Natural has reported “monster” sales and profit growth. Third-quarter sales jumped 24% from $381.5 million last year to $474.7 million this quarter. Over the same period, net income also rose 24% to $82.4 million, or 88 cents per share. Plus, speculation is heating up that Monster might be an acquisition target by Red Bull or one of the major soft drink companies. With Red Bull’s recent decision to pull out of NASCAR as a sponsor, a “monster” acquisition might be just what the energy drink maker needs to capture additional U.S. market share.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Spectrum Pharmaceuticals Inc. (NASDAQ:SPPI) is familiar pharmaceutical company I once discussed in the Top 5 Emerging Growth Stocks for December. Spectrum specializes in oncology — the treatment of cancer — and currently has two cancer treatments on the market: Fusilev, a treatment for advanced colon cancer, and Zevalin, a treatment for a type of lymphoma.
But what really excites me about this company is what it has in its pipeline: Spectrum has more than 10 drugs in either late-stage development or development! This includes Apaziquone, a treatment for bladder cancer, Belinostat, another lymphoma treatment and Ozarelix, a treatment of prostate cancer. This is a midsize biotechnology company already at the top of the industry — in terms of return on equity — and is about to experience blowout growth.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Jazz Pharmaceuticals Inc. (NASDAQ:JAZZ) has two flagship drugs — Xyrem, the only narcolepsy treatment approved by the World Anti-Doping Agency, and Luvox CR, its obsessive compulsive disorder treatment. But there are a number of exciting developments on the near horizon, including Jazz’s massive buyout of Dublin-based Azur Pharma Ltd., which should close within the next couple of weeks, and the company’s subsequent moving of its headquarters to Dublin. After the move, Jazz will be able to take advantage of Ireland’s competitive tax rate.
The company’s sales climbed 63.3% and earnings surged 115.6% in the third quarter, and for the fourth quarter, the analyst community is expecting 54% annual sales growth and 70.5% earnings growth. Jazz Pharmaceuticals is flush with cash and recently prepaid $33 million in long-term debt, and I’m excited to see how developments play out in the company’s next earnings release. Also, despite those who might think that Jazz Pharma’s bullish run looks tapped out, I remain optimistic.
Taiwan-based Silicon Motion Technology (NASDAQ:SIMO) has its hand in lots of hot markets and is a big player in flash memory storage — flash memory cards, USB flash drives, card readers and solid-state hard drives. In fact, most of the NAND flash and next-generation flash products on the market — whether produced by Samsung (PINK:SSNLF), SanDisk (NASDAQ:SNDK), Toshiba, Micron (NASDAQ:MU) or Intel (NASDAQ:INTC) — are supported by Silicon Motion controllers. Silicon Motion also produces multimedia chips including embedded graphics processors, image processors and TV tuners. Lastly, it has been increasingly focused on controllers for smartphones, tablets and notebook PCs, as well as wireless transceivers for 4G LTE smartphones and tablets.
In the third quarter, Silicon Motion’s sales rose 25% to $63.2 million compared with $50.5 million in the second quarter. Looking forward, the analyst community is expecting annual fourth-quarter sales growth of 51% and 88.9% earnings growth. In the past three months, the analyst community has revised their consensus earnings estimate 32% higher — a phenomenon that typically precedes blowout earnings surprises.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Questor Pharmaceuticals (NASDAQ:QCOR) likes a challenge. As a specialist of difficult-to-treat central nervous system disorders, the company has been particularly successful with its multiple sclerosis treatment, H.P. Acthar Gel. The company also makes Doral, which is used for the treatment of insomnia. In the massive biotechnology industry, Questcor is top-notch in terms of earnings per share growth and return on equity.
For the fourth quarter, the analyst community is expecting 127.4% annual sales growth and 265.7% earnings growth of 38 cents per share. In the past three months, the analyst community has revised their consensus earnings estimate 32.6% higher. Typically, such positive analyst earnings revisions precede future earnings surprises.
Top 5 Emerging Growth Stocks to Buy for January in 2012 -Hansen Natural (NASDAQ:HANS) is the mastermind behind Monster, a dominant energy drink in the U.S. Looking at a can of Monster Energy drink, the flashy staple of sleep-deprived college students, one wouldn’t think that the company’s humble beginnings stem back to just one father and three sons working with a juicer in Southern California. In fact, although Hansen sells supercharged drinks like Monster and Java Monster, most of its drink roster is actually very wholesome. For example, it has 30 real fruit and spice soda flavors, a number of immune system-boosting drinks, vitamin waters and an array of teas and lemonades.
In recent quarters, Hansen Natural has reported “monster” sales and profit growth. Third-quarter sales jumped 24% from $381.5 million last year to $474.7 million this quarter. Over the same period, net income also rose 24% to $82.4 million, or 88 cents per share. Plus, speculation is heating up that Monster might be an acquisition target by Red Bull or one of the major soft drink companies. With Red Bull’s recent decision to pull out of NASCAR as a sponsor, a “monster” acquisition might be just what the energy drink maker needs to capture additional U.S. market share.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Spectrum Pharmaceuticals Inc. (NASDAQ:SPPI) is familiar pharmaceutical company I once discussed in the Top 5 Emerging Growth Stocks for December. Spectrum specializes in oncology — the treatment of cancer — and currently has two cancer treatments on the market: Fusilev, a treatment for advanced colon cancer, and Zevalin, a treatment for a type of lymphoma.
But what really excites me about this company is what it has in its pipeline: Spectrum has more than 10 drugs in either late-stage development or development! This includes Apaziquone, a treatment for bladder cancer, Belinostat, another lymphoma treatment and Ozarelix, a treatment of prostate cancer. This is a midsize biotechnology company already at the top of the industry — in terms of return on equity — and is about to experience blowout growth.
Top 5 Emerging Growth Stocks to Buy for January in 2012 - Jazz Pharmaceuticals Inc. (NASDAQ:JAZZ) has two flagship drugs — Xyrem, the only narcolepsy treatment approved by the World Anti-Doping Agency, and Luvox CR, its obsessive compulsive disorder treatment. But there are a number of exciting developments on the near horizon, including Jazz’s massive buyout of Dublin-based Azur Pharma Ltd., which should close within the next couple of weeks, and the company’s subsequent moving of its headquarters to Dublin. After the move, Jazz will be able to take advantage of Ireland’s competitive tax rate.
The company’s sales climbed 63.3% and earnings surged 115.6% in the third quarter, and for the fourth quarter, the analyst community is expecting 54% annual sales growth and 70.5% earnings growth. Jazz Pharmaceuticals is flush with cash and recently prepaid $33 million in long-term debt, and I’m excited to see how developments play out in the company’s next earnings release. Also, despite those who might think that Jazz Pharma’s bullish run looks tapped out, I remain optimistic.
3 Small-Cap Stocks to Buys for January in 2012
First up this month, I have CVD Equipment (NASDAQ:CVV), a manufacturer of the gear behind tomorrow’s futuristic nanotechnologies, including solar cells, electronic components, carbon nanotubes, LEDS and smart material coatings.
But what really has the company in investor headlines lately is its involvement with graphene, the thinnest and toughest material ever produced. Graphene is a one-atom-thick layer of carbon. Academics have recently figured out how to manipulate the way the material conducts electricity, a breakthrough that opens the door to its use in computers, since graphene conducts electricity 30 times faster than silicon — approaching the speed of light!
Graphene is an extraordinary material — in 2010, Andre Geim and Konstantin Novoselov won the Nobel Prize in Physics for their groundbreaking experiments with it, and there are a lot of companies, universities and industries researching it. It’s too soon to tell which of these players will be the big winner, so I want to go straight to the source and invest in the equipment that all of these players need for their research.
With the excitement about graphene and its possible uses, it’s no surprise that CVD’s order backlog has soared this year, climbing 141% in the third quarter. Sales in the third quarter rose 119.3%, to $8.8 million, compared with $4 million year-on-year. During the same period, CVD Equipment’s earnings surged 566.7%, to $1.2 million — $0.20 per share. The analyst community was expecting earnings of $0.11 per share, so the company posted a whopping 81.8% earnings surprise.
For the fourth quarter, the analyst community is expecting 66.7% annual sales growth and 87.5% earnings growth. In the past three months, analysts have revised their consensus earnings estimate 30.6% higher. Of course, such positive analyst earnings revisions usually precede tremendous future earnings surprises.
3 Small-Cap Stocks to Buys for January in 2012 - Mitcham Industries (NASDAQ:MIND) is a high-tech provider of seismic equipment to the energy industry, enabling the next generation of oil-and-gas exploration.
Oil companies are increasingly finding it difficult to extract gas from traditional deposits and are being forced to look at alternative sources and methods of extraction. With viable alternative energy sources still a ways off, Mitcham’s products are going to become integral to the maintenance of our energy status quo.
The company leases seismic equipment to energy companies that allows them to get a picture of what’s happening below ground. Mitcham also manufactures and sells seismic gear under the well-known Seamap brand name.
Mitcham’s manufacturing-and-leasing business model provides superior margins compared with other segments of the seismic industry. In the third quarter, sales rose 40%, to $28 million, compared with $20 million in the same quarter a year ago. During the same period, earnings soared 642.9%, to $6.8 million, or $0.52 per share. The analyst community was expecting earnings of $0.22 per share, so the company posted a whopping 136.4% earnings surprise.
In the third quarter, Mitcham says, there was strong demand from Latin America and companies tapping the gas-holding shale formations of the U.S. Looking forward, Mitcham predicts strong results in Russia and Canada this winter. In addition, the company says it’s encouraged by the number of inquiries and orders for long-term work. For the fourth quarter, the analyst community is expecting 47.8% annual sales growth and 135.9% earnings growth.
3 Small-Cap Stocks to Buys for January in 2012 - Plains All American Pipeline (NYSE:PAA) is cashing in big time on the transportation and storage of crude oil, refined products and natural gas in the U.S. and Canada. And in December, the company announced five asset-rich strategic acquisitions totaling $2.3 billion.
Its blockbuster deal was snapping up British Petroleum’s (NYSE:BP) natural-gas liquids business in Canada for $1.67 billion in cash, which will expand Plains All American’s Canadian footprint and provide the capacity to increase its U.S. operations. The location of the BP pipelines and plants allows for processing of gas from new U.S. formations, including the Bakken formation in North Dakota and the Marcellus formation in Pennsylvania. In total, the acquisition includes about 2,500 miles of pipelines, 21 million barrels of LNG capacity and seven gas-processing plants. The deal is expected to close in the first half of this year.
The company also announced four “bolt-on” acquisitions for about $620 million, including a South Texas crude-oil and condensate-gathering system, a Canadian trucking operation, a multiple-product storage facility in Yorktown, Va., and a pipeline in the Permian Basin.
Plains All American has an extremely attractive 5.4% dividend, and as a Master Limited Partnership, it can allow for pass-through income, eliminating the “double taxation” that is generally applied to corporations. Looking forward to the fourth quarter, the analyst community is expecting annual sales growth of 38.3% and earnings growth of 59.3%. In the past three months, the analyst community has revised its consensus earnings estimate 20.6% higher.
3 Small-Cap Stocks to Buys for January in 2012 -
But what really has the company in investor headlines lately is its involvement with graphene, the thinnest and toughest material ever produced. Graphene is a one-atom-thick layer of carbon. Academics have recently figured out how to manipulate the way the material conducts electricity, a breakthrough that opens the door to its use in computers, since graphene conducts electricity 30 times faster than silicon — approaching the speed of light!
Graphene is an extraordinary material — in 2010, Andre Geim and Konstantin Novoselov won the Nobel Prize in Physics for their groundbreaking experiments with it, and there are a lot of companies, universities and industries researching it. It’s too soon to tell which of these players will be the big winner, so I want to go straight to the source and invest in the equipment that all of these players need for their research.
With the excitement about graphene and its possible uses, it’s no surprise that CVD’s order backlog has soared this year, climbing 141% in the third quarter. Sales in the third quarter rose 119.3%, to $8.8 million, compared with $4 million year-on-year. During the same period, CVD Equipment’s earnings surged 566.7%, to $1.2 million — $0.20 per share. The analyst community was expecting earnings of $0.11 per share, so the company posted a whopping 81.8% earnings surprise.
For the fourth quarter, the analyst community is expecting 66.7% annual sales growth and 87.5% earnings growth. In the past three months, analysts have revised their consensus earnings estimate 30.6% higher. Of course, such positive analyst earnings revisions usually precede tremendous future earnings surprises.
3 Small-Cap Stocks to Buys for January in 2012 - Mitcham Industries (NASDAQ:MIND) is a high-tech provider of seismic equipment to the energy industry, enabling the next generation of oil-and-gas exploration.
Oil companies are increasingly finding it difficult to extract gas from traditional deposits and are being forced to look at alternative sources and methods of extraction. With viable alternative energy sources still a ways off, Mitcham’s products are going to become integral to the maintenance of our energy status quo.
The company leases seismic equipment to energy companies that allows them to get a picture of what’s happening below ground. Mitcham also manufactures and sells seismic gear under the well-known Seamap brand name.
Mitcham’s manufacturing-and-leasing business model provides superior margins compared with other segments of the seismic industry. In the third quarter, sales rose 40%, to $28 million, compared with $20 million in the same quarter a year ago. During the same period, earnings soared 642.9%, to $6.8 million, or $0.52 per share. The analyst community was expecting earnings of $0.22 per share, so the company posted a whopping 136.4% earnings surprise.
In the third quarter, Mitcham says, there was strong demand from Latin America and companies tapping the gas-holding shale formations of the U.S. Looking forward, Mitcham predicts strong results in Russia and Canada this winter. In addition, the company says it’s encouraged by the number of inquiries and orders for long-term work. For the fourth quarter, the analyst community is expecting 47.8% annual sales growth and 135.9% earnings growth.
3 Small-Cap Stocks to Buys for January in 2012 - Plains All American Pipeline (NYSE:PAA) is cashing in big time on the transportation and storage of crude oil, refined products and natural gas in the U.S. and Canada. And in December, the company announced five asset-rich strategic acquisitions totaling $2.3 billion.
Its blockbuster deal was snapping up British Petroleum’s (NYSE:BP) natural-gas liquids business in Canada for $1.67 billion in cash, which will expand Plains All American’s Canadian footprint and provide the capacity to increase its U.S. operations. The location of the BP pipelines and plants allows for processing of gas from new U.S. formations, including the Bakken formation in North Dakota and the Marcellus formation in Pennsylvania. In total, the acquisition includes about 2,500 miles of pipelines, 21 million barrels of LNG capacity and seven gas-processing plants. The deal is expected to close in the first half of this year.
The company also announced four “bolt-on” acquisitions for about $620 million, including a South Texas crude-oil and condensate-gathering system, a Canadian trucking operation, a multiple-product storage facility in Yorktown, Va., and a pipeline in the Permian Basin.
Plains All American has an extremely attractive 5.4% dividend, and as a Master Limited Partnership, it can allow for pass-through income, eliminating the “double taxation” that is generally applied to corporations. Looking forward to the fourth quarter, the analyst community is expecting annual sales growth of 38.3% and earnings growth of 59.3%. In the past three months, the analyst community has revised its consensus earnings estimate 20.6% higher.
3 Small-Cap Stocks to Buys for January in 2012 -
3 Forgotten Stocks Worth Reconnecting With in 2012
It’s always worth a look when a one-time growth stock falls into value territory, and the market volatility of the past year has left its share of former high-fliers stranded well below their recent highs. Three such stocks are Monsanto (NYSE:MON), Teva Pharmaceuticals (NASDAQ:TEVA) and Ericsson (NASDAQ:ERIC). Once favorites of the press and institutional money managers alike, these stocks have quietly maintained steady fundamentals even as their valuations have come down. This disconnect presents an opportunity for longer-term investors.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Monsanto
Monsanto is a case in point. The stock of this global agribusiness giant delivered a 22-bagger for investors from mid-2002 through mid-2008 — a period that saw its P/E surge from the mid-teens into the 50s. During this interval, the market became enamored with the “story” of the company capitalizing on rising global agricultural production through its genetically enhanced seeds. But Monsanto’s market value has been cut in half since its 2008 heyday thanks to rising competition, price pressures and slowing sales for its signature Roundup product. The result: a stock whose valuation no longer captures its earnings power.
According to the USDA, the average net cash income for U.S.-based farm businesses rose 17% in 2011 and is on track for another increase for 2012. Notably, the latest survey of farmer confidence showed continued strength, which obviously is a positive for suppliers such as Monsanto. The company has a strong product pipeline — including drought-tolerant corn, expected to launch in 2013 — that provides a solid foundation for earnings in the years ahead. It also should be noted that Monsanto, whose products help boost crop yields, still is in a prime position to benefit from the long-term imbalance created by the rising demand for agricultural products and the static supply of arable land. As a kicker, the stock yields a 1.7% dividend.
Despite these positives, the stock is trading at a discount to its five-year averages for all key valuation measures: P/E, price-to-book, price-to-sales and PEG. The chart also is potentially favorable with the possibility of a breakout if the stock rises above $77. Monsanto reports earnings Thursday.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Teva Pharmaceuticals
Israel-based Teva, the world’s largest maker of generic drugs, rewarded investors with a total return of over 1,000% from 1999-2009. The stock has been left in the dust in the past two years, however — from its April 2010 high near $65, Teva is off nearly 40% even as the broader pharmaceutical sector has gained ground. Teva has been hit by concerns about rising competition and the potential loss of exclusivity on a key drug, but the stock is beginning to look like a value at these levels.
The IMS Institute for Health Care Infomatics is calling for the market share of branded drugs (which stood at 70% in 2005) to drop from 64% in 2010 to 53% in 2015 as the use of generics increases. In addition, a number of brand-name drugs are losing exclusivity in 2012, to the tune of a total sales volume of $28 billion. Both of these trends work in Teva’s favor.
Although Teva is a profitable company with important long-term trends working in its favor — analysts are looking for 13% EPS growth in 2012 — the stock has been left for dead. Among the numbers investors should take into account: The trailing P/E, at 12, is less than half the five-year average of 24.6. (The forward P/E is even more attractive at 7.2.) Price-to-book stands at 1.6 versus the five-year average of 2.4, while price-to-sales is at 2.1 versus 3.3. What’s more, Teva yields 1.7%, and management recently announced a buyback program worth $3 billion. With numbers like these, it looks like it finally might be time for this fallen angel to start playing catchup with its industry peers.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Ericsson
By now, the broadband theme is well-known: Rising smartphone and tablet usage is creating a surge in demand for broadband capacity, and telecom operators’ ability to meet this fast-growing capacity is limited. But what seems to have been lost on investors is that Ericsson — the market-share leader in providing the equipment and services that will help operators meet demand in the years ahead — still is one of the companies that is positioned to capitalize on this trend.
Nevertheless, the growth-stock darling of the 1990s now is a value play, with a forward P/E of 10.8 (and 8.6 net of cash), a trailing price-to-sales ratio of 0.98 (versus a five-year average of 1.3%), $6.7 billion in cash and a dividend yield of 3.6%. The stock was off 11% in 2011.
It might require patience for the market to pick up on the potential value here, but a look at the total picture reveals meaningful upside potential and limited downside risk from this level.
The bottom line: All three of these somewhat-forgotten market leaders have the potential to provide market-beating returns in the year ahead, even if the broader investment environment remains challenging.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Monsanto
Monsanto is a case in point. The stock of this global agribusiness giant delivered a 22-bagger for investors from mid-2002 through mid-2008 — a period that saw its P/E surge from the mid-teens into the 50s. During this interval, the market became enamored with the “story” of the company capitalizing on rising global agricultural production through its genetically enhanced seeds. But Monsanto’s market value has been cut in half since its 2008 heyday thanks to rising competition, price pressures and slowing sales for its signature Roundup product. The result: a stock whose valuation no longer captures its earnings power.
According to the USDA, the average net cash income for U.S.-based farm businesses rose 17% in 2011 and is on track for another increase for 2012. Notably, the latest survey of farmer confidence showed continued strength, which obviously is a positive for suppliers such as Monsanto. The company has a strong product pipeline — including drought-tolerant corn, expected to launch in 2013 — that provides a solid foundation for earnings in the years ahead. It also should be noted that Monsanto, whose products help boost crop yields, still is in a prime position to benefit from the long-term imbalance created by the rising demand for agricultural products and the static supply of arable land. As a kicker, the stock yields a 1.7% dividend.
Despite these positives, the stock is trading at a discount to its five-year averages for all key valuation measures: P/E, price-to-book, price-to-sales and PEG. The chart also is potentially favorable with the possibility of a breakout if the stock rises above $77. Monsanto reports earnings Thursday.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Teva Pharmaceuticals
Israel-based Teva, the world’s largest maker of generic drugs, rewarded investors with a total return of over 1,000% from 1999-2009. The stock has been left in the dust in the past two years, however — from its April 2010 high near $65, Teva is off nearly 40% even as the broader pharmaceutical sector has gained ground. Teva has been hit by concerns about rising competition and the potential loss of exclusivity on a key drug, but the stock is beginning to look like a value at these levels.
The IMS Institute for Health Care Infomatics is calling for the market share of branded drugs (which stood at 70% in 2005) to drop from 64% in 2010 to 53% in 2015 as the use of generics increases. In addition, a number of brand-name drugs are losing exclusivity in 2012, to the tune of a total sales volume of $28 billion. Both of these trends work in Teva’s favor.
Although Teva is a profitable company with important long-term trends working in its favor — analysts are looking for 13% EPS growth in 2012 — the stock has been left for dead. Among the numbers investors should take into account: The trailing P/E, at 12, is less than half the five-year average of 24.6. (The forward P/E is even more attractive at 7.2.) Price-to-book stands at 1.6 versus the five-year average of 2.4, while price-to-sales is at 2.1 versus 3.3. What’s more, Teva yields 1.7%, and management recently announced a buyback program worth $3 billion. With numbers like these, it looks like it finally might be time for this fallen angel to start playing catchup with its industry peers.
3 Forgotten Stocks Worth Reconnecting With in 2012 - Ericsson
By now, the broadband theme is well-known: Rising smartphone and tablet usage is creating a surge in demand for broadband capacity, and telecom operators’ ability to meet this fast-growing capacity is limited. But what seems to have been lost on investors is that Ericsson — the market-share leader in providing the equipment and services that will help operators meet demand in the years ahead — still is one of the companies that is positioned to capitalize on this trend.
Nevertheless, the growth-stock darling of the 1990s now is a value play, with a forward P/E of 10.8 (and 8.6 net of cash), a trailing price-to-sales ratio of 0.98 (versus a five-year average of 1.3%), $6.7 billion in cash and a dividend yield of 3.6%. The stock was off 11% in 2011.
It might require patience for the market to pick up on the potential value here, but a look at the total picture reveals meaningful upside potential and limited downside risk from this level.
The bottom line: All three of these somewhat-forgotten market leaders have the potential to provide market-beating returns in the year ahead, even if the broader investment environment remains challenging.
Top 5 best Blue-Chip Stocks to invest for January in 2012
This month, I’m shaking up the Top 5 list. Although I’m keeping two Top 5 veterans on the list, three blue-chip companies are also poised to pop this month, and I want to make sure that you’re ready to capitalize on this opportunity.
I want to have a smooth ride going into the new year, so this month’s Top 5 is made up of all conservative stocks that thrive during the late winter months. Be sure to add some of these premium stocks before they take off.
Top 5 Best Blue-Chip Stocks to invest for January in 2012:Alexion Pharmaceuticals
Alexion Pharmaceuticals LogoAlexion Pharmaceuticals (NASDAQ:ALXN) continues its winning streak this month as the No. 1 Top 5 stock on my buy list. In early December, the company enjoyed a major windfall as European Union regulators approved a new use for Soliris, the company’s only approved drug. Soliris will now treat atypical Hemolytic-uremic syndrome, a severe blood disorder that became an epidemic in Germany in May 2011. This treatment, which will launch in the first half of the new year, will be a boon to the company because Alexion gets the benefit of a new customer base with relatively minor up-front costs.
Also, the company is headed toward another stunning earnings announcement on Feb. 6. Analysts currently expect Alexion to grow sales by 41.7% and earnings by 30.8%. In addition, the analyst community has revised its earnings-per-share estimates 13% higher in the past three months, which suggests another hefty earnings surprise for Q4 2011.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: Reynolds American
Reynolds American (NYSE: RAI)Reynolds American (NYSE:RAI) is the ultimate value stock. After releasing Q3 earnings results in late October, the tobacco giant increased its already-hefty dividend by 5.7%. A few weeks later, company leadership authorized a massive $2.5 billion stock buyback program to be carried out over the next two-and-a-half years. And signs are pointing to tremendous Q4 operating results when the company releases earnings on Jan. 30.
Analysts currently expect the company to grow earnings by 15%, a significantly higher rate than the 9.9% forecast for the rest of the tobacco industry. Also, in the past month, analysts have revised their earnings estimates 3% higher, whereas they have decreased their earnings estimates for many of its competitors — analyst earnings revisions like this typically precede earnings surprises.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: McDonald’s
MCDMcDonald’s (NYSE:MCD) is an institution in the fast-food industry, but this company is doing anything but sitting on its laurels. In the past month, this company has switched out one of its major egg suppliers and announced a $400 million plan to upgrade its restaurants with flat-screen TVs, padded seats and wooden tables.
All of these developments have clearly paid off — management recently announced that McDonald’s global same-store sales boomed 7.4% in November. Even in the U.S., sales rose 6.5% — according to management, the McCafe Peppermint Mocha succeeded in bringing in customers looking for an inexpensive holiday treat. In Europe, McDonald’s also brought in a 6.5% gain. All of these figures easily topped the 4.2% sales growth forecast by Street analysts. McDonald’s is living proof that an “old dog” can learn new tricks, and I’m excited to see what other changes this company announces.
Top 5 Best Blue-Chip Stocks to invest for January in 2012:Dominion Resources
dominion resourcesDominion Resources (NYSE:D) is the perfect winter-weather stock. Its customers in Virginia and North Carolina are cranking up the heat as the temperature continues to drop, which means increased profits for its Dominion Virginia Power segment. This makes conditions ripe for stunning Q4 earnings. One of the reasons I added this company to my buy list in December is because this company is incredibly resilient. In Q3, Dominion weathered not only Hurricane Irene, but also a 5.9-magnitude earthquake that struck its North Anna nuclear power station. Despite the combined $87 million cost from these natural disasters, the company still managed to grow earnings more than expected.
Looking forward, management expects higher revenues for Q4, as well as an increase in earnings per share thanks to the company’s aggressive stock buyback programs. The company doesn’t report earnings until Jan. 23, so there is plenty of time to load up on this stock in anticipation of the earnings report.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: VF Corp.
VF Corp LogoIn my article “New Year’s Prediction #4: Retail, the Hottest Sector of 2012,” I mentioned I had another retail recommendation up my sleeve for 2012. With more than $9 billion in annual sales, VF Corp. (NYSE:VFC) is the world’s largest apparel company, and it’s easy to see why. The company is responsible for designing and manufacturing apparel, footwear and travel accessories for at least 20 major brands. In Q4 2011, VF Corp.’s sales rose 23% to $2.75 billion compared with $2.23 billion in Q3 2010.
Looking to Q4 2011 , the analyst community predicts 37% sales growth and 32% earnings growth. In the past three months, the analyst community has revised their consensus earnings estimate 7.6% higher. Typically, like with Reynolds American, positive earnings estimates precede future earnings surprises. VF Corp. is anticipated to benefit immensely from strong consumer spending this holiday season. This company also has the fourth-highest dividend yield in the Apparel industry, weighing in at 2.1%.
I want to have a smooth ride going into the new year, so this month’s Top 5 is made up of all conservative stocks that thrive during the late winter months. Be sure to add some of these premium stocks before they take off.
Top 5 Best Blue-Chip Stocks to invest for January in 2012:Alexion Pharmaceuticals
Alexion Pharmaceuticals LogoAlexion Pharmaceuticals (NASDAQ:ALXN) continues its winning streak this month as the No. 1 Top 5 stock on my buy list. In early December, the company enjoyed a major windfall as European Union regulators approved a new use for Soliris, the company’s only approved drug. Soliris will now treat atypical Hemolytic-uremic syndrome, a severe blood disorder that became an epidemic in Germany in May 2011. This treatment, which will launch in the first half of the new year, will be a boon to the company because Alexion gets the benefit of a new customer base with relatively minor up-front costs.
Also, the company is headed toward another stunning earnings announcement on Feb. 6. Analysts currently expect Alexion to grow sales by 41.7% and earnings by 30.8%. In addition, the analyst community has revised its earnings-per-share estimates 13% higher in the past three months, which suggests another hefty earnings surprise for Q4 2011.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: Reynolds American
Reynolds American (NYSE: RAI)Reynolds American (NYSE:RAI) is the ultimate value stock. After releasing Q3 earnings results in late October, the tobacco giant increased its already-hefty dividend by 5.7%. A few weeks later, company leadership authorized a massive $2.5 billion stock buyback program to be carried out over the next two-and-a-half years. And signs are pointing to tremendous Q4 operating results when the company releases earnings on Jan. 30.
Analysts currently expect the company to grow earnings by 15%, a significantly higher rate than the 9.9% forecast for the rest of the tobacco industry. Also, in the past month, analysts have revised their earnings estimates 3% higher, whereas they have decreased their earnings estimates for many of its competitors — analyst earnings revisions like this typically precede earnings surprises.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: McDonald’s
MCDMcDonald’s (NYSE:MCD) is an institution in the fast-food industry, but this company is doing anything but sitting on its laurels. In the past month, this company has switched out one of its major egg suppliers and announced a $400 million plan to upgrade its restaurants with flat-screen TVs, padded seats and wooden tables.
All of these developments have clearly paid off — management recently announced that McDonald’s global same-store sales boomed 7.4% in November. Even in the U.S., sales rose 6.5% — according to management, the McCafe Peppermint Mocha succeeded in bringing in customers looking for an inexpensive holiday treat. In Europe, McDonald’s also brought in a 6.5% gain. All of these figures easily topped the 4.2% sales growth forecast by Street analysts. McDonald’s is living proof that an “old dog” can learn new tricks, and I’m excited to see what other changes this company announces.
Top 5 Best Blue-Chip Stocks to invest for January in 2012:Dominion Resources
dominion resourcesDominion Resources (NYSE:D) is the perfect winter-weather stock. Its customers in Virginia and North Carolina are cranking up the heat as the temperature continues to drop, which means increased profits for its Dominion Virginia Power segment. This makes conditions ripe for stunning Q4 earnings. One of the reasons I added this company to my buy list in December is because this company is incredibly resilient. In Q3, Dominion weathered not only Hurricane Irene, but also a 5.9-magnitude earthquake that struck its North Anna nuclear power station. Despite the combined $87 million cost from these natural disasters, the company still managed to grow earnings more than expected.
Looking forward, management expects higher revenues for Q4, as well as an increase in earnings per share thanks to the company’s aggressive stock buyback programs. The company doesn’t report earnings until Jan. 23, so there is plenty of time to load up on this stock in anticipation of the earnings report.
Top 5 Best Blue-Chip Stocks to invest for January in 2012: VF Corp.
VF Corp LogoIn my article “New Year’s Prediction #4: Retail, the Hottest Sector of 2012,” I mentioned I had another retail recommendation up my sleeve for 2012. With more than $9 billion in annual sales, VF Corp. (NYSE:VFC) is the world’s largest apparel company, and it’s easy to see why. The company is responsible for designing and manufacturing apparel, footwear and travel accessories for at least 20 major brands. In Q4 2011, VF Corp.’s sales rose 23% to $2.75 billion compared with $2.23 billion in Q3 2010.
Looking to Q4 2011 , the analyst community predicts 37% sales growth and 32% earnings growth. In the past three months, the analyst community has revised their consensus earnings estimate 7.6% higher. Typically, like with Reynolds American, positive earnings estimates precede future earnings surprises. VF Corp. is anticipated to benefit immensely from strong consumer spending this holiday season. This company also has the fourth-highest dividend yield in the Apparel industry, weighing in at 2.1%.
Top 10 Dow Dividend Stocks to invest in 2012
It was a crazy year for every component of the Dow Jones Industrial Average. The best Dow stock was McDonald’s (NYSE:MCD), up 31%, and the worst was Bank of America (NYSE:BAC), down almost 60%. But despite those outliers, the broader index moved only slightly upward to tally a 6% gain on the year.
Of course, dividend investors got an even better return if they played the right stocks with the right yields. Many Dow stocks pay an annual dividend worth 3% of their current share price — not a bad return on your investment in this choppy market! And some pay dividends as high as 6%.
So which companies make the best income investments in the Dow? Here’s a list of the top 10 Dow dividend stocks so you can see for yourself:
Top 10 Dow Dividend Stocks to invest in 2012#10: Kraft, Chevron, JPMorgan and Microsoft
There is a very crowded pack in the Dow when it comes to stocks with a yield of around 3%, give or take a few hundredths of a percentage point. The companies include:
* Kraft (NYSE:KFT) — the consumer staples powerhouse locked in gains of 19% in 2011.
* Chevron (NYSE:CVX) — the oil powerhouse climbed 17% in 2011.
* JPMorgan Chase (NYSE:JPM) — a loss of 22% sounds ugly, but not compared to many of its big banking peers.
* Microsoft (NASDAQ:MSFT) — a lackluster 7% loss in 2011 held back this top tech stock.
Rather than cherry-pick a company (Kraft is the nominal winner with a 3.09% yield as of Friday’s close) only to have the list reorder in a few days, it seems best to list them all — though personally I find the presence of JPMorgan most noteworthy, as financial stocks have only recently been returning to the ranks of dividend payers.
Top 10 Dow Dividend Stocks to invest in 2012#9: Procter & Gamble
Procter & Gamble (NYSE:PG)Current Dividend Yield: 3.1%
2011 Performance: +4%
Procter & Gamble (NYSE:PG) has pretty much tracked the broader Dow Jones Industrial Average this year, squeaking out a small gain of around 4% for all of 2011. The consumer products giant has relied on the power of P&G brands like Gillette, Pampers and Duracell to provide reliable revenue — and reliable dividend payments to shareholders. Revenue and profits haven’t been growing at a breakneck pace, to be sure, but there’s something to be said for stability in a volatile market. The company has paid dividends since 1891.
Top 10 Dow Dividend Stocks to invest in 2012#8: Intel
Intel INTCCurrent Dividend Yield: 3.4%
2011 Performance: +16%
Semiconductor giant Intel (NASDAQ:INTC) might not seem like the place to look for big dividends. However, its 3.4% yield easily ranks it in the top 10 Dow dividend stocks. You also might think INTC isn’t doing so well right now, considering weak consumer and business spending. Wrong on that count, too. The chipmaker has posted big gains in 2011 thanks to impressive baseline demand for high-tech items. After all, it’s not like computers are becoming less common because of the downturn — if anything, they are more crucial than ever before to boost productivity. INTC is riding eight straight quarters of year-over-year revenue growth right now.
Top 10 Dow Dividend Stocks to invest in 2012#7: Johnson & Johnson
Johnson & Johnson (NYSE:JNJ)Current Dividend Yield: 3.5%
2011 Performance: +6%
The first health care stock on the list of top 10 Dow dividend stocks is Johnson & Johnson (NYSE:JNJ) — but a few more are yet to come. The company is part-pharmaceutical giant thanks to prescription drug offerings like vaccines, and part-consumer health company thanks to products like Band-Aid and Tylenol. Revenue admittedly has been a bit stagnant at J&J during the past few years; however, earnings per share continue to improve. J&J is a sleepy play, but tracking the market for a decent gain — and a 3.6% dividend to boot — doesn’t seem like anything to sneeze at after a challenging 2011.
Top 10 Dow Dividend Stocks to invest in 2012#6: DuPont
Dupont (NYSE:DD)Current Dividend Yield: 3.6%
2011 Performance: -8%
E.I. du Pont de Nemours & Company (NYSE:DD), a.k.a. DuPont, has lagged the market so far in 2011. Dividend investors still should take note of this chemical giant, however. The 3.6% yield is one of the best in the Dow Jones Industrial Average, and DuPont could be a good long-term investment for the inevitable recovery — because even if there is a tough market for another year or two, DuPont will hang tough and pay a good dividend while you wait. As a specialty chemical company, DD provides materials for a host of products in all corners of the market. Once demand picks up, so will DD stock.
Top 10 Dow Dividend Stocks to invest in 2012#5: General Electric
General Electric GECurrent Dividend Yield: 3.8%
2011 Performance: -2%
General Electric (NYSE:GE) might forever be tarnished in the minds of some dividend investors after slashing its payout by two-thirds during the financial crisis. While the quarterly dividend remains about half of what it was — at just 17 cents vs. 31 before the market meltdown — the subsequent flop in GE stock managed to result in a very respectable yield. Revenue continues to slide for the conglomerate, which is a concern, but earnings remain robust and the dividends remain rich in relation to the stock’s current valuation.
Top 10 Dow Dividend Stocks to invest in 2012#4: Pfizer
%50BAC
2011 Performance: +24%
Pfizer (NYSE:PFE) has outperformed the market nicely in 2011 with one of the best returns in the entire Dow Jones. Yes, it faces the same challenge that persists across all of Big Pharma — looming patent expirations, challenges from generic medications and the frantic race to lock up patients in emerging markets. But the company has a decent research pipeline with some up-and-coming drugs that could rotate in to prop up revenues. Most importantly for dividend investors, the company has $29 billion in cash as of its third-quarter earnings report. With a forward P/E of less than 10 even after this run, there may be more upside for Pfizer in 2012. And if the stock gains don’t blow you away, that 4% dividend is a nice benefit.
Top 10 Dow Dividend Stocks to invest in 2012#3: Merck
Merck & Co. (NYSE:MRK)Current Dividend Yield: 4.5%
2011 Performance: 5%
Merck (NYSE:MRK) is very similar to Pfizer, except for its mostly market-tracking performance in 2011. It, too, faces patent expirations and is hoping its pipeline will step up to fill the void. It, too, is trading for a bargain P/E of under 10. It, too, pays a dividend well north of 4%. A huge $41 billion buyout of rival Schering-Plough in 2009 should help provide new areas of growth, and the company has managed to post four straight year-over-year revenue beats in the quarters since Schering-Plough was integrated into operations. Throw in solid cash flow and a history of dividends since 1935, and you can understand why this stable company is a bedrock buy for many portfolios.
Top 10 Dow Dividend Stocks to invest in 2012#2: Verizon
%63
Of course, dividend investors got an even better return if they played the right stocks with the right yields. Many Dow stocks pay an annual dividend worth 3% of their current share price — not a bad return on your investment in this choppy market! And some pay dividends as high as 6%.
2011 Performance: +12%
Verizon (NYSE:VZ) is the leading wireless telecom provider in the U.S. by subscriptions. The company also is one of the top high-speed Internet providers in America via its FiOS fiber optic network. As the world becomes increasingly wired, it’s more important than ever before for companies like Verizon to be involved with the operations of businesses and the lives of regular Americans. This provides a very stable revenue stream that accounts for huge dividends. What’s more, Verizon’s EPS for the fiscal year are on track to tally over $2.20 — easily double the 90 cents per share earned in fiscal 2010. A target of $2.50 for fiscal 2012 shows there’s more growth to come, too.
Top 10 Dow Dividend Stocks to invest in 2012#1: AT&T
AT&T TCurrent Dividend Yield: 5.8%
2011 Performance: +3%
One of the biggest stories in 2011 was that AT&T (NYSE:T) tried to leapfrog rival Verizon in the wireless market via a buyout of T-Mobile. But regulators ran interference, and AT&T abandoned its bid. Don’t think that means the biggest dividend payer in the Dow Jones Industrial Average should be cut loose from your portfolio. With a dividend yield of about 6%, this is a heck of an income play. After all, 10-year T-Notes are around 2% — roughly a third of AT&T’s dividend yield. Red-hot growth might not be ahead, but AT&T is a stable company with a great dividend that’s not going anywhere. That’s the kind of investment many investors are impressed with after a volatile 2011.
Of course, dividend investors got an even better return if they played the right stocks with the right yields. Many Dow stocks pay an annual dividend worth 3% of their current share price — not a bad return on your investment in this choppy market! And some pay dividends as high as 6%.
So which companies make the best income investments in the Dow? Here’s a list of the top 10 Dow dividend stocks so you can see for yourself:
Top 10 Dow Dividend Stocks to invest in 2012#10: Kraft, Chevron, JPMorgan and Microsoft
There is a very crowded pack in the Dow when it comes to stocks with a yield of around 3%, give or take a few hundredths of a percentage point. The companies include:
* Kraft (NYSE:KFT) — the consumer staples powerhouse locked in gains of 19% in 2011.
* Chevron (NYSE:CVX) — the oil powerhouse climbed 17% in 2011.
* JPMorgan Chase (NYSE:JPM) — a loss of 22% sounds ugly, but not compared to many of its big banking peers.
* Microsoft (NASDAQ:MSFT) — a lackluster 7% loss in 2011 held back this top tech stock.
Rather than cherry-pick a company (Kraft is the nominal winner with a 3.09% yield as of Friday’s close) only to have the list reorder in a few days, it seems best to list them all — though personally I find the presence of JPMorgan most noteworthy, as financial stocks have only recently been returning to the ranks of dividend payers.
Top 10 Dow Dividend Stocks to invest in 2012#9: Procter & Gamble
Procter & Gamble (NYSE:PG)Current Dividend Yield: 3.1%
2011 Performance: +4%
Procter & Gamble (NYSE:PG) has pretty much tracked the broader Dow Jones Industrial Average this year, squeaking out a small gain of around 4% for all of 2011. The consumer products giant has relied on the power of P&G brands like Gillette, Pampers and Duracell to provide reliable revenue — and reliable dividend payments to shareholders. Revenue and profits haven’t been growing at a breakneck pace, to be sure, but there’s something to be said for stability in a volatile market. The company has paid dividends since 1891.
Top 10 Dow Dividend Stocks to invest in 2012#8: Intel
Intel INTCCurrent Dividend Yield: 3.4%
2011 Performance: +16%
Semiconductor giant Intel (NASDAQ:INTC) might not seem like the place to look for big dividends. However, its 3.4% yield easily ranks it in the top 10 Dow dividend stocks. You also might think INTC isn’t doing so well right now, considering weak consumer and business spending. Wrong on that count, too. The chipmaker has posted big gains in 2011 thanks to impressive baseline demand for high-tech items. After all, it’s not like computers are becoming less common because of the downturn — if anything, they are more crucial than ever before to boost productivity. INTC is riding eight straight quarters of year-over-year revenue growth right now.
Top 10 Dow Dividend Stocks to invest in 2012#7: Johnson & Johnson
Johnson & Johnson (NYSE:JNJ)Current Dividend Yield: 3.5%
2011 Performance: +6%
The first health care stock on the list of top 10 Dow dividend stocks is Johnson & Johnson (NYSE:JNJ) — but a few more are yet to come. The company is part-pharmaceutical giant thanks to prescription drug offerings like vaccines, and part-consumer health company thanks to products like Band-Aid and Tylenol. Revenue admittedly has been a bit stagnant at J&J during the past few years; however, earnings per share continue to improve. J&J is a sleepy play, but tracking the market for a decent gain — and a 3.6% dividend to boot — doesn’t seem like anything to sneeze at after a challenging 2011.
Top 10 Dow Dividend Stocks to invest in 2012#6: DuPont
Dupont (NYSE:DD)Current Dividend Yield: 3.6%
2011 Performance: -8%
E.I. du Pont de Nemours & Company (NYSE:DD), a.k.a. DuPont, has lagged the market so far in 2011. Dividend investors still should take note of this chemical giant, however. The 3.6% yield is one of the best in the Dow Jones Industrial Average, and DuPont could be a good long-term investment for the inevitable recovery — because even if there is a tough market for another year or two, DuPont will hang tough and pay a good dividend while you wait. As a specialty chemical company, DD provides materials for a host of products in all corners of the market. Once demand picks up, so will DD stock.
Top 10 Dow Dividend Stocks to invest in 2012#5: General Electric
General Electric GECurrent Dividend Yield: 3.8%
2011 Performance: -2%
General Electric (NYSE:GE) might forever be tarnished in the minds of some dividend investors after slashing its payout by two-thirds during the financial crisis. While the quarterly dividend remains about half of what it was — at just 17 cents vs. 31 before the market meltdown — the subsequent flop in GE stock managed to result in a very respectable yield. Revenue continues to slide for the conglomerate, which is a concern, but earnings remain robust and the dividends remain rich in relation to the stock’s current valuation.
Top 10 Dow Dividend Stocks to invest in 2012#4: Pfizer
%50BAC
2011 Performance: +24%
Pfizer (NYSE:PFE) has outperformed the market nicely in 2011 with one of the best returns in the entire Dow Jones. Yes, it faces the same challenge that persists across all of Big Pharma — looming patent expirations, challenges from generic medications and the frantic race to lock up patients in emerging markets. But the company has a decent research pipeline with some up-and-coming drugs that could rotate in to prop up revenues. Most importantly for dividend investors, the company has $29 billion in cash as of its third-quarter earnings report. With a forward P/E of less than 10 even after this run, there may be more upside for Pfizer in 2012. And if the stock gains don’t blow you away, that 4% dividend is a nice benefit.
Top 10 Dow Dividend Stocks to invest in 2012#3: Merck
Merck & Co. (NYSE:MRK)Current Dividend Yield: 4.5%
2011 Performance: 5%
Merck (NYSE:MRK) is very similar to Pfizer, except for its mostly market-tracking performance in 2011. It, too, faces patent expirations and is hoping its pipeline will step up to fill the void. It, too, is trading for a bargain P/E of under 10. It, too, pays a dividend well north of 4%. A huge $41 billion buyout of rival Schering-Plough in 2009 should help provide new areas of growth, and the company has managed to post four straight year-over-year revenue beats in the quarters since Schering-Plough was integrated into operations. Throw in solid cash flow and a history of dividends since 1935, and you can understand why this stable company is a bedrock buy for many portfolios.
Top 10 Dow Dividend Stocks to invest in 2012#2: Verizon
%63
Of course, dividend investors got an even better return if they played the right stocks with the right yields. Many Dow stocks pay an annual dividend worth 3% of their current share price — not a bad return on your investment in this choppy market! And some pay dividends as high as 6%.
2011 Performance: +12%
Verizon (NYSE:VZ) is the leading wireless telecom provider in the U.S. by subscriptions. The company also is one of the top high-speed Internet providers in America via its FiOS fiber optic network. As the world becomes increasingly wired, it’s more important than ever before for companies like Verizon to be involved with the operations of businesses and the lives of regular Americans. This provides a very stable revenue stream that accounts for huge dividends. What’s more, Verizon’s EPS for the fiscal year are on track to tally over $2.20 — easily double the 90 cents per share earned in fiscal 2010. A target of $2.50 for fiscal 2012 shows there’s more growth to come, too.
Top 10 Dow Dividend Stocks to invest in 2012#1: AT&T
AT&T TCurrent Dividend Yield: 5.8%
2011 Performance: +3%
One of the biggest stories in 2011 was that AT&T (NYSE:T) tried to leapfrog rival Verizon in the wireless market via a buyout of T-Mobile. But regulators ran interference, and AT&T abandoned its bid. Don’t think that means the biggest dividend payer in the Dow Jones Industrial Average should be cut loose from your portfolio. With a dividend yield of about 6%, this is a heck of an income play. After all, 10-year T-Notes are around 2% — roughly a third of AT&T’s dividend yield. Red-hot growth might not be ahead, but AT&T is a stable company with a great dividend that’s not going anywhere. That’s the kind of investment many investors are impressed with after a volatile 2011.
5 Cruise and Car Stocks to Sell in 2012
Are you thinking about taking a cruise anytime soon? How about buying a new car?
No? Well, not surprisingly, many investors are feeling the same way. In this economy, people are scaling back and saving up. That new car is being eschewed for auto maintenance, and that Disney cruise with the family is being sidelined for a road trip to your Aunt Mary’s. Although the auto industry isn’t as bad as it was during the bailouts, companies like Ford (NYSE:F) and General Motors (NYSE:GM) haven’t exactly been bastions of growth and excitement, save for Ford’s late-to-the-party, lower-than-average dividend payout.
I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve got five automotive and international cruise line stocks to sell.
Here they are, in alphabetical order. Each one of these stocks gets a “D” or “F” according to my research, meaning it is a “sell” or “strong sell.”
5 Cruise and Car Stocks to Sell in 2012 : Carnival (NYSE:CCL) is an international cruise company. In the last 12 months, CCL shareholders have watched the stock slip 29%. CCL stock gets a “D” for operating margin growth and a “D” for cash flow. For more information, view my complete analysis of CCL stock.
5 Cruise and Car Stocks to Sell in 2012:Ford (NYSE:F) is likely the most well-known American automaker. Year-to-date, F stock is down 37% compared to a gain of 4% for the Dow Jones Industrials. F stock gets a “D” for operating margin growth and a “D” for earnings growth in my Portfolio Grader tool. For more information, view my complete analysis of F stock.
5 Cruise and Car Stocks to Sell in 2012:General Motors (NYSE:GM) is another giant global automotive maker. Since the start of 2011, GM stock has lost a staggering 45% compared to gains by the broader markets. GM stock gets an “F” for earnings growth, an “F” for earnings momentum and a “D” for its ability to exceed the consensus earnings estimates on Wall Street in my Portfolio Grader tool. For more information, view my complete analysis of GM stock.
5 Cruise and Car Stocks to Sell in 2012:Johnson Controls (NYSE:JCI) provides a variety of products, including automotive interiors and energy-saving products for buildings. JCI has suffered a loss of 22%, year-to-date. JCI stocks gets a “D” for operating margin growth, a “D” for its ability to exceed the consensus earnings estimates on Wall Street and a “D” for the magnitude in which earnings projections have increased over the past month in my Portfolio Grader tool. For more information, view my complete analysis of JCI stock.
5 Cruise and Car Stocks to Sell in 2012:Royal Caribbean (NYSE:RCL) is the second large cruise line that makes the list. Since the start of 2011, RCL is down 48% compared to gains by the broader markets. RCL stock gets an “F” for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of RCL stock.
Get more analysis of these picks and other publicly traded stocks with Louis Navellier’s Portfolio Grader tool, a 100% free stock-rating tool that measures both quantitative buying pressure and eight fundamental factors.
No? Well, not surprisingly, many investors are feeling the same way. In this economy, people are scaling back and saving up. That new car is being eschewed for auto maintenance, and that Disney cruise with the family is being sidelined for a road trip to your Aunt Mary’s. Although the auto industry isn’t as bad as it was during the bailouts, companies like Ford (NYSE:F) and General Motors (NYSE:GM) haven’t exactly been bastions of growth and excitement, save for Ford’s late-to-the-party, lower-than-average dividend payout.
I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve got five automotive and international cruise line stocks to sell.
Here they are, in alphabetical order. Each one of these stocks gets a “D” or “F” according to my research, meaning it is a “sell” or “strong sell.”
5 Cruise and Car Stocks to Sell in 2012 : Carnival (NYSE:CCL) is an international cruise company. In the last 12 months, CCL shareholders have watched the stock slip 29%. CCL stock gets a “D” for operating margin growth and a “D” for cash flow. For more information, view my complete analysis of CCL stock.
5 Cruise and Car Stocks to Sell in 2012:Ford (NYSE:F) is likely the most well-known American automaker. Year-to-date, F stock is down 37% compared to a gain of 4% for the Dow Jones Industrials. F stock gets a “D” for operating margin growth and a “D” for earnings growth in my Portfolio Grader tool. For more information, view my complete analysis of F stock.
5 Cruise and Car Stocks to Sell in 2012:General Motors (NYSE:GM) is another giant global automotive maker. Since the start of 2011, GM stock has lost a staggering 45% compared to gains by the broader markets. GM stock gets an “F” for earnings growth, an “F” for earnings momentum and a “D” for its ability to exceed the consensus earnings estimates on Wall Street in my Portfolio Grader tool. For more information, view my complete analysis of GM stock.
5 Cruise and Car Stocks to Sell in 2012:Johnson Controls (NYSE:JCI) provides a variety of products, including automotive interiors and energy-saving products for buildings. JCI has suffered a loss of 22%, year-to-date. JCI stocks gets a “D” for operating margin growth, a “D” for its ability to exceed the consensus earnings estimates on Wall Street and a “D” for the magnitude in which earnings projections have increased over the past month in my Portfolio Grader tool. For more information, view my complete analysis of JCI stock.
5 Cruise and Car Stocks to Sell in 2012:Royal Caribbean (NYSE:RCL) is the second large cruise line that makes the list. Since the start of 2011, RCL is down 48% compared to gains by the broader markets. RCL stock gets an “F” for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of RCL stock.
Get more analysis of these picks and other publicly traded stocks with Louis Navellier’s Portfolio Grader tool, a 100% free stock-rating tool that measures both quantitative buying pressure and eight fundamental factors.
Best Stocks To Invest in January 2012
My investment strategy seeks out stocks that are cheap relative to their growth rate — referred to as growth at a reasonable price, or GARP. To that end, I seek out stocks that are selling at low price-earnings-to-growth, or PEG, ratios.
The price-to-earnings, or P/E, ratio is a measure of risk. It calculates the multiple of earnings an investor is willing to pay. The higher the multiple, the greater the stock price will react to changes in earnings per share. A stock sporting a lower multiple is considered safer because of the lesser impact that earnings has upon stock price. Lower-P/E stocks tend to compensate investors by paying dividends.
Best Stocks To Buy For 2012: F.N.B. Corporation (FNB)
F.N.B. Corporation, through its subsidiaries, provides various financial services to consumers and small to medium-sized businesses. The company operates in four segments: Community Banking, Wealth Management, Insurance, and Consumer Finance. The Community Banking segment offers various commercial banking services, including commercial and individual demand, savings, and time deposit accounts; and commercial, mortgage, and individual installment loans. The Wealth Management segment provides a range of personal and corporate fiduciary services, such as the administration of decedent and trust estates. It also offers various alternative products, including securities brokerage and investment advisory services, mutual funds, and annuities. The Insurance segment operates as a full-service insurance agency that offers commercial and personal insurance through various carriers; acts as a reinsurer to underwrite credit life, and accident and health insurance; and offers title insurance products. The Consumer Finance segment involves in making personal installment loans to individuals; and purchasing installment sales finance contracts from retail merchants. As of December 31, 2009, it had 224 community banking offices in Pennsylvania and Ohio, and 57 consumer finance offices in Pennsylvania, Ohio, and Tennessee. The company was founded in 1974 and is headquartered in Hermitage, Pennsylvania.
Best Stocks To Buy For 2012: STEC Inc. (STEC)
STEC, Inc. designs, manufactures, and markets enterprise-class flash solid-state drives (SSDs) for use in high-performance storage and server systems. Its solid-state drive products include ZeusIOPS SSDs, which provide enterprise-class data storage solutions; and MACH-class SSDs that are small form factor storage solutions for mission-critical systems in various industries. The company?s flash cards and flash module products comprise ATA PC Cards for equipment requiring standard form factors and moderate capacities, such as data recorders, avionics systems, and telecommunication applications; CompactFlash products, which provide interoperability with systems based on the PC Card ATA standard by using a passive adapter; flash modules; secure digital memory cards; USB flash drives; and single chip drives. It also offers dynamic random access memory (DRAM) products, which include dual in-line memory modules (DIMMs), small-outline DIMMs, mini-registered DIMMs, very low profile registered DIMMs, and fully-buffered DIMMs for computing, communications, and industrial applications. In addition, the company provides integrated circuit tower stacked components for thin small outline package and ball grid array semiconductor packages for use on memory modules and within high capacity flash products; DRAM modules with stacked components for use primarily in high-performance servers, workstations, switches and routers, and other custom systems; and flash products with stacked components. It sells its products through direct sales force and original equipment manufacturer distributors in the United States and internationally. STEC, Inc. was founded in 1990 and is headquartered in Santa Ana, California.
Advisors’ Opinion:
* Curtis2011-8-26Stec is the only provider qualified and shipping product in the Enterprise Storage Market for Fibre Channel and SAS interface drives. While competition appears inevitable in the market in the future, the brokerage believes the company has a strong technological and qualification lead at the OEMs, which should enable it to maintain market share leadership in the future.”Given our expectation that the Enterprise Storage SSD market is likely to be significantly up in 2011 over 2010, and STEC appears likely to maintain an edge over competition in terms of technology and, hence, market share, we believe STEC shares at current levels do not capture the potential upside in terms of market potential or competitive positioning,” the analysts said.
Best Stocks To Buy For 2012: Imergent Inc. (IIG)
Advisors’ Opinion:
* Zacks2011-10-24iMergent, Inc. (IIG) said it made progress on all fronts and delivered a solid fiscal first quarter performance in early November. The company, which provides eCommerce and software for small businesses and entrepreneurs, stated that strong domestic sales and a reinvigorated international program spawned fiscal first-quarter revenue of $29 million, compared to $11.4 million a year earlier. Furthermore, net income reached 18 cents per share, reversing a year-ago loss. Net dollar volume of contracts written was $32.4 million, compared to $17 million. Shares of iMergent jumped 38% during November and reached a new 52-week high on the 16th of the month.iMergent increased its guidance for full year 2007 due to strong demand and response to its marketing. Net dollar volume of contracts written is expected to grow between 25% and 30% from fiscal 2006.
Best Stocks To Buy For 2012: Modine Manufacturing Company (MOD)
Modine Manufacturing Company engages in the development, manufacture, and marketing of heat exchangers and systems for use in on-highway and off-highway original equipment manufacturer (OEM) vehicular applications, and to various building, industrial, refrigeration, and fuel cell markets. It offers power train cooling products, including engine cooling modules, radiators, charge-air-coolers, condensers, fan shrouds, and surge tanks; on-engine cooling products comprising exhaust gas recirculation coolers, engine oil coolers, fuel coolers, charge-air-coolers, and intake air coolers; oil coolers consisting of transmission oil coolers and power steering coolers; and fuel coolers. The company also provides gas-fired, hydronic, electric, and oil-fired unit heaters; indoor and outdoor duct furnaces; infrared units; hydronic products, including commercial fin-tube radiation, cabinet unit heaters, and convectors; roof mounted direct and indirect fired makeup air units; unit ventilators; close control units for precise temperature and humidity control applications; chillers; ceiling cassettes; and condensing units and coils for heating, refrigeration, air conditioning, and vehicular applications. Its customers include truck, automobile, bus, specialty vehicle, agricultural and construction, and heating and cooling OEMs; construction contractors; wholesalers of plumbing and heating equipment; fuel cell manufacturers; engine manufacturers; industrial manufacturers of material handling equipment, generator sets, and compressors; and various end users. The company offers its products primarily in North America, Europe, South America, Africa, and the Asia/Pacific. Modine Manufacturing Company also exports its products. The company was founded in 1916 and is headquartered in Racine, Wisconsin.
The price-to-earnings, or P/E, ratio is a measure of risk. It calculates the multiple of earnings an investor is willing to pay. The higher the multiple, the greater the stock price will react to changes in earnings per share. A stock sporting a lower multiple is considered safer because of the lesser impact that earnings has upon stock price. Lower-P/E stocks tend to compensate investors by paying dividends.
Best Stocks To Buy For 2012: F.N.B. Corporation (FNB)
F.N.B. Corporation, through its subsidiaries, provides various financial services to consumers and small to medium-sized businesses. The company operates in four segments: Community Banking, Wealth Management, Insurance, and Consumer Finance. The Community Banking segment offers various commercial banking services, including commercial and individual demand, savings, and time deposit accounts; and commercial, mortgage, and individual installment loans. The Wealth Management segment provides a range of personal and corporate fiduciary services, such as the administration of decedent and trust estates. It also offers various alternative products, including securities brokerage and investment advisory services, mutual funds, and annuities. The Insurance segment operates as a full-service insurance agency that offers commercial and personal insurance through various carriers; acts as a reinsurer to underwrite credit life, and accident and health insurance; and offers title insurance products. The Consumer Finance segment involves in making personal installment loans to individuals; and purchasing installment sales finance contracts from retail merchants. As of December 31, 2009, it had 224 community banking offices in Pennsylvania and Ohio, and 57 consumer finance offices in Pennsylvania, Ohio, and Tennessee. The company was founded in 1974 and is headquartered in Hermitage, Pennsylvania.
Best Stocks To Buy For 2012: STEC Inc. (STEC)
STEC, Inc. designs, manufactures, and markets enterprise-class flash solid-state drives (SSDs) for use in high-performance storage and server systems. Its solid-state drive products include ZeusIOPS SSDs, which provide enterprise-class data storage solutions; and MACH-class SSDs that are small form factor storage solutions for mission-critical systems in various industries. The company?s flash cards and flash module products comprise ATA PC Cards for equipment requiring standard form factors and moderate capacities, such as data recorders, avionics systems, and telecommunication applications; CompactFlash products, which provide interoperability with systems based on the PC Card ATA standard by using a passive adapter; flash modules; secure digital memory cards; USB flash drives; and single chip drives. It also offers dynamic random access memory (DRAM) products, which include dual in-line memory modules (DIMMs), small-outline DIMMs, mini-registered DIMMs, very low profile registered DIMMs, and fully-buffered DIMMs for computing, communications, and industrial applications. In addition, the company provides integrated circuit tower stacked components for thin small outline package and ball grid array semiconductor packages for use on memory modules and within high capacity flash products; DRAM modules with stacked components for use primarily in high-performance servers, workstations, switches and routers, and other custom systems; and flash products with stacked components. It sells its products through direct sales force and original equipment manufacturer distributors in the United States and internationally. STEC, Inc. was founded in 1990 and is headquartered in Santa Ana, California.
Advisors’ Opinion:
* Curtis2011-8-26Stec is the only provider qualified and shipping product in the Enterprise Storage Market for Fibre Channel and SAS interface drives. While competition appears inevitable in the market in the future, the brokerage believes the company has a strong technological and qualification lead at the OEMs, which should enable it to maintain market share leadership in the future.”Given our expectation that the Enterprise Storage SSD market is likely to be significantly up in 2011 over 2010, and STEC appears likely to maintain an edge over competition in terms of technology and, hence, market share, we believe STEC shares at current levels do not capture the potential upside in terms of market potential or competitive positioning,” the analysts said.
Best Stocks To Buy For 2012: Imergent Inc. (IIG)
Advisors’ Opinion:
* Zacks2011-10-24iMergent, Inc. (IIG) said it made progress on all fronts and delivered a solid fiscal first quarter performance in early November. The company, which provides eCommerce and software for small businesses and entrepreneurs, stated that strong domestic sales and a reinvigorated international program spawned fiscal first-quarter revenue of $29 million, compared to $11.4 million a year earlier. Furthermore, net income reached 18 cents per share, reversing a year-ago loss. Net dollar volume of contracts written was $32.4 million, compared to $17 million. Shares of iMergent jumped 38% during November and reached a new 52-week high on the 16th of the month.iMergent increased its guidance for full year 2007 due to strong demand and response to its marketing. Net dollar volume of contracts written is expected to grow between 25% and 30% from fiscal 2006.
Best Stocks To Buy For 2012: Modine Manufacturing Company (MOD)
Modine Manufacturing Company engages in the development, manufacture, and marketing of heat exchangers and systems for use in on-highway and off-highway original equipment manufacturer (OEM) vehicular applications, and to various building, industrial, refrigeration, and fuel cell markets. It offers power train cooling products, including engine cooling modules, radiators, charge-air-coolers, condensers, fan shrouds, and surge tanks; on-engine cooling products comprising exhaust gas recirculation coolers, engine oil coolers, fuel coolers, charge-air-coolers, and intake air coolers; oil coolers consisting of transmission oil coolers and power steering coolers; and fuel coolers. The company also provides gas-fired, hydronic, electric, and oil-fired unit heaters; indoor and outdoor duct furnaces; infrared units; hydronic products, including commercial fin-tube radiation, cabinet unit heaters, and convectors; roof mounted direct and indirect fired makeup air units; unit ventilators; close control units for precise temperature and humidity control applications; chillers; ceiling cassettes; and condensing units and coils for heating, refrigeration, air conditioning, and vehicular applications. Its customers include truck, automobile, bus, specialty vehicle, agricultural and construction, and heating and cooling OEMs; construction contractors; wholesalers of plumbing and heating equipment; fuel cell manufacturers; engine manufacturers; industrial manufacturers of material handling equipment, generator sets, and compressors; and various end users. The company offers its products primarily in North America, Europe, South America, Africa, and the Asia/Pacific. Modine Manufacturing Company also exports its products. The company was founded in 1916 and is headquartered in Racine, Wisconsin.
2012 Banks Burned by Europe — Thursday’s IP Market Recap
Budding optimism this week for solutions to the European debt crisis ground to a halt Thursday as the head of the European Central Bank gave a pessimistic outlook for tomorrow’s Brussels meeting, killing the market’s three-day climb and sending bank shareholders to the exits.
While the ECB dropped interest rates to an all-time low 1% and said it would open up three-year loans to euro zone banks, negative comments about the low possibility of lending to the International Monetary Fund — which then would lend the money to euro zone members in a form of quantitative easing — soured the markets. The Dow Jones tumbled nearly 200 points by day’s end.
European financials like Royal Bank of Scotland (NYSE:RBS, -7.93%) and Deutsche Bank (NYSE:DB, -7.76%) were torched, as was U.S.-based Morgan Stanley (NYSE:MS, -8.42%), which is thought to have significant exposure to a European debt crisis. The fallout also trickled down to national banking giants Citigroup (NYSE:C, -6.97%), JPMorgan Chase (NYSE:JPM, -5.24%) and Bank of America (NYSE:BAC, -5.09%).
Electric vehicle maker Tesla Motors (NASDAQ:TSLA) had more than enough problems without the general market sentiment Thursday, with TSLA stock plunging almost 10% to $30.89 after Morgan Stanley’s Adam Jonas hacked his price target by 37% and downgraded Tesla to underweight. Jonas expressed satisfaction with Tesla’s performance, with the pessimism instead focused toward the entire electric vehicle industry.
On the opposite side of the spectrum, Affymax (NASDAQ:AFFY) — whose stock suffered through a roller-coaster ride earlier this week hinging on the fate of its experimental anemia medicine, peginesatide — spiked Thursday on news that advisers to the Food and Drug Administration would back its drug.
During the day, Affymax stock almost reached $8.50, its highest point since June 2010, when AFFY shares took a 70% hit after the company’s trial anemia drug — then called Hematide — was reported to have greater cardiovascular risks than an existing Amgen (NASDAQ:AMGN) product. Affymax stock finished Thursday at $7.99, up 36%.
Three Up
* DemandTec (NASDAQ:DMAN): Up 55.99% ($4.72) to $13.15.
* Coinstar (NASDAQ:CSTR): Up 7.84% ($3.45) to $47.45.
* Sodastream International (NASDAQ:SODA): Up 2.36% (83 cents) to ($35.96).
Three Down
* Melco Crown Entertainment (NASDAQ:MPEL): Down 6.7% (65 cents) to $9.05.
* Nokia (NYSE:NOK): Down 6.19% (33 cents) to $5.
* Juniper Networks (NASDAQ:JNPR): Down 5.91% ($1.26) to $20.05.
As of this writing, Kyle Woodley did not hold a position in any of the aforementioned stocks. Check out our list of previous IP Market Recaps.
While the ECB dropped interest rates to an all-time low 1% and said it would open up three-year loans to euro zone banks, negative comments about the low possibility of lending to the International Monetary Fund — which then would lend the money to euro zone members in a form of quantitative easing — soured the markets. The Dow Jones tumbled nearly 200 points by day’s end.
European financials like Royal Bank of Scotland (NYSE:RBS, -7.93%) and Deutsche Bank (NYSE:DB, -7.76%) were torched, as was U.S.-based Morgan Stanley (NYSE:MS, -8.42%), which is thought to have significant exposure to a European debt crisis. The fallout also trickled down to national banking giants Citigroup (NYSE:C, -6.97%), JPMorgan Chase (NYSE:JPM, -5.24%) and Bank of America (NYSE:BAC, -5.09%).
Electric vehicle maker Tesla Motors (NASDAQ:TSLA) had more than enough problems without the general market sentiment Thursday, with TSLA stock plunging almost 10% to $30.89 after Morgan Stanley’s Adam Jonas hacked his price target by 37% and downgraded Tesla to underweight. Jonas expressed satisfaction with Tesla’s performance, with the pessimism instead focused toward the entire electric vehicle industry.
On the opposite side of the spectrum, Affymax (NASDAQ:AFFY) — whose stock suffered through a roller-coaster ride earlier this week hinging on the fate of its experimental anemia medicine, peginesatide — spiked Thursday on news that advisers to the Food and Drug Administration would back its drug.
During the day, Affymax stock almost reached $8.50, its highest point since June 2010, when AFFY shares took a 70% hit after the company’s trial anemia drug — then called Hematide — was reported to have greater cardiovascular risks than an existing Amgen (NASDAQ:AMGN) product. Affymax stock finished Thursday at $7.99, up 36%.
Three Up
* DemandTec (NASDAQ:DMAN): Up 55.99% ($4.72) to $13.15.
* Coinstar (NASDAQ:CSTR): Up 7.84% ($3.45) to $47.45.
* Sodastream International (NASDAQ:SODA): Up 2.36% (83 cents) to ($35.96).
Three Down
* Melco Crown Entertainment (NASDAQ:MPEL): Down 6.7% (65 cents) to $9.05.
* Nokia (NYSE:NOK): Down 6.19% (33 cents) to $5.
* Juniper Networks (NASDAQ:JNPR): Down 5.91% ($1.26) to $20.05.
As of this writing, Kyle Woodley did not hold a position in any of the aforementioned stocks. Check out our list of previous IP Market Recaps.
The Most Profitable Companies Invest In America 2012
Looking for the best buys on the market right now? We may have the investing answer you’ve been waiting for.All stock prices are driven by profit projections, and a handful of American companies just posted impressive 2010 profits. Firms with a clear vision of how to increase value for shareholders could be a terrific buy right now. But companies without a good game plan will likely see their stock prices fall as they fritter away their earnings.
The hardest part? Learning to separate the former from the latter. Here’s a list of the most profitable companies in America, along with our prediction of which direction the stock is heading.
The Most Profitable Companies To Invest In NO.17: Citigroup (NYSE: C) – $10.6 Billion
For many years, Citigroup (NYSE: C) was the most profitable banking firm in the United States. But a series of foolish moves allowed JPMorgan Chase (NYSE: JPM) and Wells Fargo (NYSE: WFC) to surpass them.
To get back to the head of the pack, Citigroup is repositioning itself as a key player in fast-growing emerging economies. Indeed, Citigroup now derives more than half its revenue from abroad.
Although the bank’s turnaround is not yet complete, the story should become a lot cleaner with each passing quarter, and eventually, investors should embrace the bank as a way to hedge against a falling dollar and as a way to have greater exposure to more dynamic economies elsewhere.
The Most Profitable Companies To Invest In NO.16: ConocoPhillips (NYSE: COP) – $11.4 Billion
Despite low profit margins, ConocoPhillips (NYSE: COP) has strengths in many areas: solid stock price performance, attractive valuation levels, robust revenue growth and compelling net income growth.
And if you think oil will continue to be expensive in the future, ConocoPhilips could be the ultimate value stock. The current dividend yield is 3.4% and management has a reputation for allocating capital to shareholders in the form of dividend increases and share buybacks — all good news for investors.
Photo courtesy of wikipedia.commons.org.
The Most Profitable Companies To Invest In NO.15: Intel (Nasdaq: INTC) – $11.5 Billion
If you own a smartphone, you are an indirect customer of Intel (Nasdaq: INTC). Though they don’t manufacture or sell any smartphone components, Intel makes processors that help data center servers keep up with the demand, and the smartphone boom has been nothing but good for the company.
In addition to its profit-generating ability, Intel also has huge cash hoards. Using its cash to acquire fast-growing firms can be an effective way to boost its own growth, so look for Intel to get in on the market’s M&A activity in the coming months.
Photo courtesy of Flickr- Josh Bancroft.
The Most Profitable Companies Invest In NO.14: General Electric (NYSE: GE) – $11.6 Billion
It’s 2010 profit results are all well and good, but the historical numbers show that General Electric (NYSE: GE) has lost its way and needs a turnaround to return to the growth heyday it experienced while under the fearless leadership of Jack Welch.
GE Capital, GE’s massive finance arm, was a major profit driver under Welch, but it nearly ruined the company during the financial crisis. Back in 2007, GE Capital accounted for 55% of net income. That share fell to 13% in 2009.
Current CEO Jeffrey Immelt has a goal to limit GE Capital to no more than 40% of profits going forward, though it only recovered to 28% of profits in 2010, so it has some way to reach that level. GE will inevitably turn around its operations at some point, but there is no need for investors to wait for the company to find its way.
Photo courtesy of Flickr- Matt Millard.
The Most Profitable Companies Invest In NO.13: Coca-Cola (NYSE: KO) – $11.8 Billion
The world’s biggest soft drink maker, Coca-Cola (NYSE: KO), recently posted strong first quarter results, with a comparable net income of $6.4 million. With a powerful global distribution network, Coca-Cola products are currently sold in more than 200 countries and boast 500 different beverage brands. In the coming years, more than $20 billion will be spent to expand into emerging markets like Africa, Russia, Mexico and China.
Helping drive growth is the recent acquisition of Coca-Cola Enterprises, the company’s largest bottling unit in North America. It will now be cheaper for the company to produce and bottle smaller scale products — like the 100-calorie Coke can — to cater to calorie-conscious consumers.
Through the acquisition, Coke expects to improve business operations by better controlling product distribution so it can more quickly respond to changing market demand. As a result, Coke expects to save more than $350 million a year for the next four years. These savings should mean good news for shareholders.
Photo courtesy of Flickr: Kyle May.
The Most Profitable Companies Invest In NO.12: Wells Fargo (NYSE: WFC) – $12.4 Billion
One thing has been clear about Wells Fargo (NYSE: WFC): the San Francisco-based bank seems to have adroitly sidestepped a great deal of the potholes besetting the banking sector the past few years. It hasn’t been immune to the powerful forces of a down economy, but at least its management hasn’t been pilloried by the press (like Bank of America (NYSE: BAC) and Goldman Sachs (NYSE: GS)), and it didn’t make life-threatening bad investments that led to government handouts (like Citigroup).
Restrictions put in place when the TARP program was in effect have limited the annual dividend, but banking analysts think the payout ratio will eventually rebound to 30%, implying a $1.08 dividend based on 2012 profit forecasts. As the economy improves, the dividend could move even higher, creating the impetus for a dividend yield above 4% when measured against today’s stock price.
And it certainly doesn’t hurt to have Warren Buffett as your co-investor. Buffett’s continued bullishness on the bank should be heartening to even the most bank-ophobic investors.
Photo courtesy of Flickr — Neubie.
The Most Profitable Companies Invest In NO.11: Procter & Gamble (NYSE: PG) – $12.7 Billion
After selling Pringles, Procter & Gamble (NYSE: PG) is officially out of the foods game. They are currently taking active steps to distance themselves from competition by expanding their health care brands into overseas markets, mainly in China and India.
P&G is also taking advantage of the rise in e-commerce popularity, recently entering the e-commerce market with an e-store. This new strategy has seen significant penetration in North America and Asia, where they are able to extend their reach into under-served, emerging markets.
Photo courtesy of Flickr – Brandon C.
The Most Profitable Companies Invest In NO.10: Berkshire Hathaway (NYSE: BRK) – $13.0 Billion
Warren Buffett has relayed numerous times that future growth rates at Berkshire Hathaway (NYSE: BRK-A) will fall below historical growth trends, but he still thinks there is potential for investors to earn above-average returns by investing in the stock. Just take the past two years as an example — book value grew 19.8% in 2009 and 13% in 2010.
This suggests Berkshire is still able to compound wealth at a double-digit rate going forward. And regardless of growth rates, the company is so well-managed that it’s difficult to imagine it even being unable to generate large profits for shareholders.
Last year, Berkshire hired money manager Todd Combs to help reshape the company’s $63.2 billion equity portfolio. Combs didn’t wait long to make his first big move, as Berkshire recently reported a stake in MasterCard, Inc. (NYSE: MA), valued at $54.4 million.
Photo courtesy of wikipedia.commons.org.
The Most Profitable Companies Invest In NO.9: Johnson & Johnson (NYSE: JNJ) – $13.3 Billion
Johnson & Johnson (NYSE: JNJ) has increased its dividends for the past 48 straight years, at an average rate of about 13.4% per year since 2000. If you purchased 200 shares of JNJ in 1980 (an investment of $14,600) and never added new money but just reinvested all the dividends, the position would be worth $1.15 million today. That’s a 7,868% return.
In other words, it’s like buying a house in 1980 for $146,000 that today is worth about $11.5 million. Home values didn’t appreciate anywhere near that much. That’s the power of growing dividends.
Photo courtesy of Flickr – aldinegirl87.
The Most Profitable Companies Invest In NO.8: Apple (Nasdaq: AAPL) – $14.0 Billion
There is only one large U.S. corporation that can truly be called a growth stock: Apple (Nasdaq: AAPL). The company’s performance was impressive enough that net income rose from $8.2 billion in 2009 to $14 billion in 2010.
What’s more impressive is the road ahead. Merrill Lynch predicts Apple will earn $34 billion by 2013, putting it at a close second behind ExxonMobil for the claim of America’s most profitable company.
Photo courtesy of Flickr — Bacr Aptemob.
The Most Profitable Companies Invest In NO.7: Int’l Business Machines (NYSE: IBM) – $14.8 Billion
Int’l Business Machines (NYSE: IBM), affectionately referred to as Big Blue, is a titan in the technology industry. The company generated almost $100 billion in revenue last year and is about as diversified a technology company as can be found, spanning software, services, hardware and financing.
IBM’s presense abroad makes it fantastic play in a weak dollar environment — just over one-third of sales stem from the United States, with the rest being generated in Europe, Asia and the rest of the world.
Photo courtesy of Flickr — Patrick H~.
The Most Profitable Companies Invest In NO.6: Wal-Mart Stores Inc. (NYSE: WMT) – $16.4 Billion
Despite falling same-store sales in the U.S. for two consecutive years, Wal-Mart (NYSE: WMT) posted a profit in both 2010 and Q1 of 2011. Their average U.S. shopper spent more per visit in Q1 of 2011, and their U.S. same-store sales of groceries and health and wellness items has increased for two consecutive quarters.
Wal-Mart’s domestic foot traffic is down, but international sales are soaring. Their profits have come largely from an 11.5% increase in international sales, offsetting the impact of the domestic slump with strong gains in all countries except Japan.
Wal-Mart is a well-run company that has historically provided long-term value to its stockholders, so don’t be discouraged by the domestic sales slump, they are still turning profits.
Photo courtesy of Flickr — Walmart Stores.
The Most Profitable Companies Invest In NO.5: JPMorgan Chase (NYSE: JPM) – $17.4 Billion
The entire banking sector is still wheezing back to life, so the next few years could represent a return to traditional banking profit margins. Notably, analysts’ forecasts anticipate subdued lending activity in 2011 and 2012 and, more than likely, bank profits will be meaningfully higher again in 2013 and beyond, granted the economy is truly healthy (and the housing market gets out of the sickbed).
Therefore, the opportunity to buy shares of banks like JP Morgan Chase (NYSE: JPM) while they trade for less than 10 times 2012 profits looks quite appealing. Trouble is, some investors are convinced that we haven’t seen the end of the mortgage crisis. So buying these bank stocks today certainly carries some short-term risk that more funds will need to be set aside to cover future liabilities.
Photo courtesy of David R. Tribble.
The Most Profitable Companies Invest In NO.4: Microsoft (Nasdaq: MSFT) – $18.8 Billion
There are some who believe that Microsoft’s (Nasdaq: MSFT) best years are behind it and the company is riding into the sunset. While Microsoft is no longer synonomous with tech’s tomorrow (see Google, Facebook and Apple), there is no denying that company is still a cash cow.
Microsoft just announced its acquisition of Skype in a deal valued at $8.5 billion. Microsoft plans on intregrating its technology with the XBox console, Kinect device and its Windows Phone platform. This may be the deal that yields the strategic benefits Microsoft needs to stop following the leaders in the industry, and start leading again.
Photo courtesy of Flickr — Robert Scoble.
The Most Profitable Companies Invest In NO.3: Chevron (NYSE: CVX) – $19.0 Billion
Chevron (NYSE: CVK) is a top-five oil firm, given its vast reserves of oil and natural gas. Growth during the past decade has been stellar, as sales have improved 15.5% and earnings by 17.5% on average each year in the past decade. Growth is projected to continue apace, with the earnings consensus for this year at $12.12 a share, or nearly 30% above last year’s levels.
At the current price, Chevron offers the solid combination of a low earnings multiple, a decent dividend yield of 2.7% and strong projected growth. And nearly 60% of last year’s stales stemmed from overseas, giving the company exposure to faster-growing regions outside of the United States.
Photo courtesy of Flickr — Jonathan McIntosh.
The Most Profitable Companies Invest In NO.2: AT&T (NYSE: T) – $19.9 Billion
AT&T (NYSE: T) posted a $19.9 billion 2010 net income, and $1 billion of that money is being invested in the cloud computing business in 2011. This will help AT&T achieve tremendous efficiencies and flexibility in cloud-based environments in order to provide applications for any type of device.
AT&T also just acquired T-Mobile for $39 billion, which helps the company vastly expand its broadband network and possibly position itself as market leader in the U.S. wireless industry.
Photo courtesy of Flickr — Chris Young.
The Most Profitable Companies Invest In NO.1: Exxon Mobil (NYSE: XOM) – $30.5 Billion
There’s no debate over how Exxon Mobil (NYSE: XOM) will use its prodigious profits. The energy giant has spent eight years buying back stock, and there’s no indication that it will stop now. Exxon Mobil has bought back two billion shares since 2002, leading to a 29% reduction in its share count.
Assuming Exxon Mobil will once again focus on stock buybacks, the share count may drop from the current 4.8 billion to just four billion by the middle of 2013. For a company with $30 billion in annual income, the shrinking share count could mean record profits per share.
The hardest part? Learning to separate the former from the latter. Here’s a list of the most profitable companies in America, along with our prediction of which direction the stock is heading.
The Most Profitable Companies To Invest In NO.17: Citigroup (NYSE: C) – $10.6 Billion
For many years, Citigroup (NYSE: C) was the most profitable banking firm in the United States. But a series of foolish moves allowed JPMorgan Chase (NYSE: JPM) and Wells Fargo (NYSE: WFC) to surpass them.
To get back to the head of the pack, Citigroup is repositioning itself as a key player in fast-growing emerging economies. Indeed, Citigroup now derives more than half its revenue from abroad.
Although the bank’s turnaround is not yet complete, the story should become a lot cleaner with each passing quarter, and eventually, investors should embrace the bank as a way to hedge against a falling dollar and as a way to have greater exposure to more dynamic economies elsewhere.
The Most Profitable Companies To Invest In NO.16: ConocoPhillips (NYSE: COP) – $11.4 Billion
Despite low profit margins, ConocoPhillips (NYSE: COP) has strengths in many areas: solid stock price performance, attractive valuation levels, robust revenue growth and compelling net income growth.
And if you think oil will continue to be expensive in the future, ConocoPhilips could be the ultimate value stock. The current dividend yield is 3.4% and management has a reputation for allocating capital to shareholders in the form of dividend increases and share buybacks — all good news for investors.
Photo courtesy of wikipedia.commons.org.
The Most Profitable Companies To Invest In NO.15: Intel (Nasdaq: INTC) – $11.5 Billion
If you own a smartphone, you are an indirect customer of Intel (Nasdaq: INTC). Though they don’t manufacture or sell any smartphone components, Intel makes processors that help data center servers keep up with the demand, and the smartphone boom has been nothing but good for the company.
In addition to its profit-generating ability, Intel also has huge cash hoards. Using its cash to acquire fast-growing firms can be an effective way to boost its own growth, so look for Intel to get in on the market’s M&A activity in the coming months.
Photo courtesy of Flickr- Josh Bancroft.
The Most Profitable Companies Invest In NO.14: General Electric (NYSE: GE) – $11.6 Billion
It’s 2010 profit results are all well and good, but the historical numbers show that General Electric (NYSE: GE) has lost its way and needs a turnaround to return to the growth heyday it experienced while under the fearless leadership of Jack Welch.
GE Capital, GE’s massive finance arm, was a major profit driver under Welch, but it nearly ruined the company during the financial crisis. Back in 2007, GE Capital accounted for 55% of net income. That share fell to 13% in 2009.
Current CEO Jeffrey Immelt has a goal to limit GE Capital to no more than 40% of profits going forward, though it only recovered to 28% of profits in 2010, so it has some way to reach that level. GE will inevitably turn around its operations at some point, but there is no need for investors to wait for the company to find its way.
Photo courtesy of Flickr- Matt Millard.
The Most Profitable Companies Invest In NO.13: Coca-Cola (NYSE: KO) – $11.8 Billion
The world’s biggest soft drink maker, Coca-Cola (NYSE: KO), recently posted strong first quarter results, with a comparable net income of $6.4 million. With a powerful global distribution network, Coca-Cola products are currently sold in more than 200 countries and boast 500 different beverage brands. In the coming years, more than $20 billion will be spent to expand into emerging markets like Africa, Russia, Mexico and China.
Helping drive growth is the recent acquisition of Coca-Cola Enterprises, the company’s largest bottling unit in North America. It will now be cheaper for the company to produce and bottle smaller scale products — like the 100-calorie Coke can — to cater to calorie-conscious consumers.
Through the acquisition, Coke expects to improve business operations by better controlling product distribution so it can more quickly respond to changing market demand. As a result, Coke expects to save more than $350 million a year for the next four years. These savings should mean good news for shareholders.
Photo courtesy of Flickr: Kyle May.
The Most Profitable Companies Invest In NO.12: Wells Fargo (NYSE: WFC) – $12.4 Billion
One thing has been clear about Wells Fargo (NYSE: WFC): the San Francisco-based bank seems to have adroitly sidestepped a great deal of the potholes besetting the banking sector the past few years. It hasn’t been immune to the powerful forces of a down economy, but at least its management hasn’t been pilloried by the press (like Bank of America (NYSE: BAC) and Goldman Sachs (NYSE: GS)), and it didn’t make life-threatening bad investments that led to government handouts (like Citigroup).
Restrictions put in place when the TARP program was in effect have limited the annual dividend, but banking analysts think the payout ratio will eventually rebound to 30%, implying a $1.08 dividend based on 2012 profit forecasts. As the economy improves, the dividend could move even higher, creating the impetus for a dividend yield above 4% when measured against today’s stock price.
And it certainly doesn’t hurt to have Warren Buffett as your co-investor. Buffett’s continued bullishness on the bank should be heartening to even the most bank-ophobic investors.
Photo courtesy of Flickr — Neubie.
The Most Profitable Companies Invest In NO.11: Procter & Gamble (NYSE: PG) – $12.7 Billion
After selling Pringles, Procter & Gamble (NYSE: PG) is officially out of the foods game. They are currently taking active steps to distance themselves from competition by expanding their health care brands into overseas markets, mainly in China and India.
P&G is also taking advantage of the rise in e-commerce popularity, recently entering the e-commerce market with an e-store. This new strategy has seen significant penetration in North America and Asia, where they are able to extend their reach into under-served, emerging markets.
Photo courtesy of Flickr – Brandon C.
The Most Profitable Companies Invest In NO.10: Berkshire Hathaway (NYSE: BRK) – $13.0 Billion
Warren Buffett has relayed numerous times that future growth rates at Berkshire Hathaway (NYSE: BRK-A) will fall below historical growth trends, but he still thinks there is potential for investors to earn above-average returns by investing in the stock. Just take the past two years as an example — book value grew 19.8% in 2009 and 13% in 2010.
This suggests Berkshire is still able to compound wealth at a double-digit rate going forward. And regardless of growth rates, the company is so well-managed that it’s difficult to imagine it even being unable to generate large profits for shareholders.
Last year, Berkshire hired money manager Todd Combs to help reshape the company’s $63.2 billion equity portfolio. Combs didn’t wait long to make his first big move, as Berkshire recently reported a stake in MasterCard, Inc. (NYSE: MA), valued at $54.4 million.
Photo courtesy of wikipedia.commons.org.
The Most Profitable Companies Invest In NO.9: Johnson & Johnson (NYSE: JNJ) – $13.3 Billion
Johnson & Johnson (NYSE: JNJ) has increased its dividends for the past 48 straight years, at an average rate of about 13.4% per year since 2000. If you purchased 200 shares of JNJ in 1980 (an investment of $14,600) and never added new money but just reinvested all the dividends, the position would be worth $1.15 million today. That’s a 7,868% return.
In other words, it’s like buying a house in 1980 for $146,000 that today is worth about $11.5 million. Home values didn’t appreciate anywhere near that much. That’s the power of growing dividends.
Photo courtesy of Flickr – aldinegirl87.
The Most Profitable Companies Invest In NO.8: Apple (Nasdaq: AAPL) – $14.0 Billion
There is only one large U.S. corporation that can truly be called a growth stock: Apple (Nasdaq: AAPL). The company’s performance was impressive enough that net income rose from $8.2 billion in 2009 to $14 billion in 2010.
What’s more impressive is the road ahead. Merrill Lynch predicts Apple will earn $34 billion by 2013, putting it at a close second behind ExxonMobil for the claim of America’s most profitable company.
Photo courtesy of Flickr — Bacr Aptemob.
The Most Profitable Companies Invest In NO.7: Int’l Business Machines (NYSE: IBM) – $14.8 Billion
Int’l Business Machines (NYSE: IBM), affectionately referred to as Big Blue, is a titan in the technology industry. The company generated almost $100 billion in revenue last year and is about as diversified a technology company as can be found, spanning software, services, hardware and financing.
IBM’s presense abroad makes it fantastic play in a weak dollar environment — just over one-third of sales stem from the United States, with the rest being generated in Europe, Asia and the rest of the world.
Photo courtesy of Flickr — Patrick H~.
The Most Profitable Companies Invest In NO.6: Wal-Mart Stores Inc. (NYSE: WMT) – $16.4 Billion
Despite falling same-store sales in the U.S. for two consecutive years, Wal-Mart (NYSE: WMT) posted a profit in both 2010 and Q1 of 2011. Their average U.S. shopper spent more per visit in Q1 of 2011, and their U.S. same-store sales of groceries and health and wellness items has increased for two consecutive quarters.
Wal-Mart’s domestic foot traffic is down, but international sales are soaring. Their profits have come largely from an 11.5% increase in international sales, offsetting the impact of the domestic slump with strong gains in all countries except Japan.
Wal-Mart is a well-run company that has historically provided long-term value to its stockholders, so don’t be discouraged by the domestic sales slump, they are still turning profits.
Photo courtesy of Flickr — Walmart Stores.
The Most Profitable Companies Invest In NO.5: JPMorgan Chase (NYSE: JPM) – $17.4 Billion
The entire banking sector is still wheezing back to life, so the next few years could represent a return to traditional banking profit margins. Notably, analysts’ forecasts anticipate subdued lending activity in 2011 and 2012 and, more than likely, bank profits will be meaningfully higher again in 2013 and beyond, granted the economy is truly healthy (and the housing market gets out of the sickbed).
Therefore, the opportunity to buy shares of banks like JP Morgan Chase (NYSE: JPM) while they trade for less than 10 times 2012 profits looks quite appealing. Trouble is, some investors are convinced that we haven’t seen the end of the mortgage crisis. So buying these bank stocks today certainly carries some short-term risk that more funds will need to be set aside to cover future liabilities.
Photo courtesy of David R. Tribble.
The Most Profitable Companies Invest In NO.4: Microsoft (Nasdaq: MSFT) – $18.8 Billion
There are some who believe that Microsoft’s (Nasdaq: MSFT) best years are behind it and the company is riding into the sunset. While Microsoft is no longer synonomous with tech’s tomorrow (see Google, Facebook and Apple), there is no denying that company is still a cash cow.
Microsoft just announced its acquisition of Skype in a deal valued at $8.5 billion. Microsoft plans on intregrating its technology with the XBox console, Kinect device and its Windows Phone platform. This may be the deal that yields the strategic benefits Microsoft needs to stop following the leaders in the industry, and start leading again.
Photo courtesy of Flickr — Robert Scoble.
The Most Profitable Companies Invest In NO.3: Chevron (NYSE: CVX) – $19.0 Billion
Chevron (NYSE: CVK) is a top-five oil firm, given its vast reserves of oil and natural gas. Growth during the past decade has been stellar, as sales have improved 15.5% and earnings by 17.5% on average each year in the past decade. Growth is projected to continue apace, with the earnings consensus for this year at $12.12 a share, or nearly 30% above last year’s levels.
At the current price, Chevron offers the solid combination of a low earnings multiple, a decent dividend yield of 2.7% and strong projected growth. And nearly 60% of last year’s stales stemmed from overseas, giving the company exposure to faster-growing regions outside of the United States.
Photo courtesy of Flickr — Jonathan McIntosh.
The Most Profitable Companies Invest In NO.2: AT&T (NYSE: T) – $19.9 Billion
AT&T (NYSE: T) posted a $19.9 billion 2010 net income, and $1 billion of that money is being invested in the cloud computing business in 2011. This will help AT&T achieve tremendous efficiencies and flexibility in cloud-based environments in order to provide applications for any type of device.
AT&T also just acquired T-Mobile for $39 billion, which helps the company vastly expand its broadband network and possibly position itself as market leader in the U.S. wireless industry.
Photo courtesy of Flickr — Chris Young.
The Most Profitable Companies Invest In NO.1: Exxon Mobil (NYSE: XOM) – $30.5 Billion
There’s no debate over how Exxon Mobil (NYSE: XOM) will use its prodigious profits. The energy giant has spent eight years buying back stock, and there’s no indication that it will stop now. Exxon Mobil has bought back two billion shares since 2002, leading to a 29% reduction in its share count.
Assuming Exxon Mobil will once again focus on stock buybacks, the share count may drop from the current 4.8 billion to just four billion by the middle of 2013. For a company with $30 billion in annual income, the shrinking share count could mean record profits per share.
2012 best 5 Cruise and Car Stocks to Sell
Are you thinking about taking a cruise anytime soon? How about buying a new car?
No? Well, not surprisingly, many investors are feeling the same way. In this economy, people are scaling back and saving up. That new car is being eschewed for auto maintenance, and that Disney cruise with the family is being sidelined for a road trip to your Aunt Mary’s. Although the auto industry isn’t as bad as it was during the bailouts, companies like Ford (NYSE:F) and General Motors (NYSE:GM) haven’t exactly been bastions of growth and excitement, save for Ford’s late-to-the-party, lower-than-average dividend payout.
I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve got five automotive and international cruise line stocks to sell.
Here they are, in alphabetical order. Each one of these stocks gets a “D” or “F” according to my research, meaning it is a “sell” or “strong sell.”
Carnival (NYSE:CCL) is an international cruise company. In the last 12 months, CCL shareholders have watched the stock slip 29%. CCL stock gets a “D” for operating margin growth and a “D” for cash flow. For more information, view my complete analysis of CCL stock.
Ford (NYSE:F) is likely the most well-known American automaker. Year-to-date, F stock is down 37% compared to a gain of 4% for the Dow Jones Industrials. F stock gets a “D” for operating margin growth and a “D” for earnings growth in my Portfolio Grader tool. For more information, view my complete analysis of F stock.
General Motors (NYSE:GM) is another giant global automotive maker. Since the start of 2011, GM stock has lost a staggering 45% compared to gains by the broader markets. GM stock gets an “F” for earnings growth, an “F” for earnings momentum and a “D” for its ability to exceed the consensus earnings estimates on Wall Street in my Portfolio Grader tool. For more information, view my complete analysis of GM stock.
Johnson Controls (NYSE:JCI) provides a variety of products, including automotive interiors and energy-saving products for buildings. JCI has suffered a loss of 22%, year-to-date. JCI stocks gets a “D” for operating margin growth, a “D” for its ability to exceed the consensus earnings estimates on Wall Street and a “D” for the magnitude in which earnings projections have increased over the past month in my Portfolio Grader tool. For more information, view my complete analysis of JCI stock.
Royal Caribbean (NYSE:RCL) is the second large cruise line that makes the list. Since the start of 2011, RCL is down 48% compared to gains by the broader markets. RCL stock gets an “F” for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of RCL stock.
Get more analysis of these picks and other publicly traded stocks with Louis Navellier’s Portfolio Grader tool, a 100% free stock-rating tool that measures both quantitative buying pressure and eight fundamental factors.
No? Well, not surprisingly, many investors are feeling the same way. In this economy, people are scaling back and saving up. That new car is being eschewed for auto maintenance, and that Disney cruise with the family is being sidelined for a road trip to your Aunt Mary’s. Although the auto industry isn’t as bad as it was during the bailouts, companies like Ford (NYSE:F) and General Motors (NYSE:GM) haven’t exactly been bastions of growth and excitement, save for Ford’s late-to-the-party, lower-than-average dividend payout.
I watch more than 5,000 publicly traded companies with my Portfolio Grader tool, ranking companies by a number of fundamental and quantitative measures. This week, I’ve got five automotive and international cruise line stocks to sell.
Here they are, in alphabetical order. Each one of these stocks gets a “D” or “F” according to my research, meaning it is a “sell” or “strong sell.”
Carnival (NYSE:CCL) is an international cruise company. In the last 12 months, CCL shareholders have watched the stock slip 29%. CCL stock gets a “D” for operating margin growth and a “D” for cash flow. For more information, view my complete analysis of CCL stock.
Ford (NYSE:F) is likely the most well-known American automaker. Year-to-date, F stock is down 37% compared to a gain of 4% for the Dow Jones Industrials. F stock gets a “D” for operating margin growth and a “D” for earnings growth in my Portfolio Grader tool. For more information, view my complete analysis of F stock.
General Motors (NYSE:GM) is another giant global automotive maker. Since the start of 2011, GM stock has lost a staggering 45% compared to gains by the broader markets. GM stock gets an “F” for earnings growth, an “F” for earnings momentum and a “D” for its ability to exceed the consensus earnings estimates on Wall Street in my Portfolio Grader tool. For more information, view my complete analysis of GM stock.
Johnson Controls (NYSE:JCI) provides a variety of products, including automotive interiors and energy-saving products for buildings. JCI has suffered a loss of 22%, year-to-date. JCI stocks gets a “D” for operating margin growth, a “D” for its ability to exceed the consensus earnings estimates on Wall Street and a “D” for the magnitude in which earnings projections have increased over the past month in my Portfolio Grader tool. For more information, view my complete analysis of JCI stock.
Royal Caribbean (NYSE:RCL) is the second large cruise line that makes the list. Since the start of 2011, RCL is down 48% compared to gains by the broader markets. RCL stock gets an “F” for cash flow in my Portfolio Grader tool. For more information, view my complete analysis of RCL stock.
Get more analysis of these picks and other publicly traded stocks with Louis Navellier’s Portfolio Grader tool, a 100% free stock-rating tool that measures both quantitative buying pressure and eight fundamental factors.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012
Below is a list of what I believe are the best values among dividend-paying stocks heading into 2012, ranked from 1 to 100. The rankings were locked in after the market closed on December 17, 2010, and counted down on this site over the last ten weekdays of the year.
It’s important to realize that these aren’t the 100 stocks I think are most likely to bring home explosive returns during 2012, because I don’t invest with that short of a window in mind. They represent the 100 companies I think are the most attractively-priced for long-term returns as we close the book on 2010.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 1. Vale S.A. (VALE)
Even after rising during the final days of 2010, shares of VALE still trade below 8x future earnings. Dividend has tripled since its 2007 valley, and has plenty of room to grow thanks to a forward payout ratio of just 11% and a top line on pace to nearly double this year.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 2. Tower Group, Inc. (TWGP)
Tower’s revenue and dividend rate have both quintupled since 2006, and neither seem to be losing momentum. Trades at a slight discount to book value and just 7.5x future earnings.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 3. CNOOC Limited (CEO)
Trades at 11x future earnings and carries very little risk thanks to a huge regulatory advantage. Has the exclusive right to share in the production of China’s offshore resources when discovered by a foreign firm, shielding CNOOC from local exploration costs.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 4. Knightsbridge Tankers Limited (VLCCF)
Dividend has recovered nicely from 2009′s cut, and is now paying nearly 9% as shares have failed to properly react to improved prospects. Company secured a $175 million credit facility in 2010 that will enable the purchase of a ninth vessel without raising additional equity.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 5. Life Partners Holdings, Inc. (LPHI)
Looked like it was finally heading toward a proper valuation before a string of bad press held shares down. With zero debt, a 5.3% dividend yield, and a forward earnings multiple of just 7.4, an investment in this unconventional business possesses a huge margin of safety.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 6. Diamond Offshore Drilling, Inc. (DO)
Diamond Offshore has supplemented its modest regular dividend with 15 special payouts since 2006, returning an incredible total of $27.13 per share to stockholders over that span (or 41% of its current share price).
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 7. Jinpan International Limited (JST)
The Chinese manufacturer split its shares and tossed shareholders a 17% dividend hike this year, with little reaction from the market. Will close 2010 with a yield of 1.3%, much better than the 0.49% it opened the year with.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 8. Amtrust Financial Services (AFSI)
Shares deservedly surged over the second half of the year (+46%), but still trade at just 1.5x book value and 7x expected 2012 earnings. Dividend has quadrupled since 2006, yet forward payout ratio remains at just 13%.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 9. Annaly Capital Management, inc. (NLY)
By far the best value for your REIT-buying dollar. That is, if you’re looking for a REIT that managed to improve its dividend every year through the recession, currently yields 14%, and will set you back less than 7x next year’s earnings.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 10. Fifth Street Finance Corp. (FSC)
The most attractively-priced BDC has only been public since 2008, but it sports an under-leveraged balance sheet, a 10% dividend yield, and trades at only a slight premium to its tangible book value.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 11. Lincoln Education Services Corporation (LINC)
Lincoln instantly became the best dividend-paying value in the for-profit education industry when it declared its first payout in November. Yields 6.4% and trades at 7x next year’s conservative earnings consensus.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 12. Chevron Corporation (CVX)
The best value among the integrated energy giants trades at just 9x next year’s earnings, compared to 10.6 for ConocoPhillips and 11.3 for ExxonMobil.
13. BHP Billiton Limited (BHP)
The Australian mining giant is diversified enough to weather the volatile commodity markets, and rich enough to acquire growth while returning an increasingly-substantial amount of cash to shareholders.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 14. PartnerRe Ltd. (PRE)
Trades at a 20% discount to book value, and the international reinsurer has raised its dividend every year since 1994 – increasing its rate by a total of 450% during that span.
15. Seadrill Limited (SDRL)
The offshore driller has achieved double-digit top line growth every year since going public in 2005, and is currently on pace to triple its 2006 revenue.
16. Intel Corporation (INTC)
A flat year leaves Intel shares with a dividend yield (3.43%) well above its five-year average (2.30%), thanks to the giant chipmaker’s biggest dividend hike since 2006.
17. Alliance Resources Partners, L.P. (ARLP)
Trades at 9x future earnings, yields 5%, has tripled its dividend rate since 2003, and raised its payout for 11 straight quarters.
18. Acme United Corporation (ACU)
An income investor’s dream: Stock is undervalued (1.2x book, 9.4x future earnings), current yield is solid (2.4%), payout ratio remains low (23%), and commitment to dividend growth is clear (boosted rate by an average of 16% annually since 2005).
19. CF Industries Holdings, Inc. (CF)
With revenue and earnings on pace to beat last year’s figures by 50% and the fertilizer company’s forward payout ratio now below 4%, it’s about time for another monster dividend hike from CF, which quintupled its payout in 2008.
20. Suncor Energy Inc. (SU)
Added earning power from Petro-Canada acquisition enabled Suncor to double its dividend without pushing its forward payout ratio over the 20% threshold.
21. Marathon Oil Corporation (MRO)
Despite an expected 23% jump in revenue, Marathon barely traded above book value in 2010. Its year-end price/book ratio (1.18), compares favorably to those of competitors Chevron (1.80), ConocoPhillips (1.44), and ExxonMobil (2.57).
22. VSE Corporation (VSEC)
If you know of any other companies with seven straight years of double-digit dividend growth, seven straight years of double-digit earnings growth, and a forward payout ratio under 5%, please fill me in.
23. TICC Capital Corp. (TICC)
If you’re looking for exposure to the tech industry but don’t want to sacrifice yield, TICC is worth looking into. The tech-focused BDC trades at just a 38% premium to tangible book value, carries no debt, and sports an 8.6% dividend yield.
24. National Presto Industries Inc. (NPK)
The do-it-all manufacturer (Skillets! Ammunition! Diapers!) currently carries a dividend rate seven times the amount paid to NPK shareholders in 2003. Revenue momentum, diversification, and overall financial efficiency should support continued dividend growth.
25. National Interstate Corporation (NATL)
With a forward payout ratio of just 16% despite getting annual raises that have averaged 19% since 2006, this dividend is primed for continued growth.
26. Archer Daniels Midland Company (ADM)
Shares scuffled enough this year to keep their forward earnings multiple under 10 and their yield above 2%, two figures you don’t expect when researching a company that’s quintupled its revenue over the last decade and raised its dividend for 35 consecutive years.
27. Compania de Minas Buenaventura SA (BVN)
Buenaventura offers exposure to both gold and silver, as well as zinc and lead. The Peruvian mining company has low production costs, very little debt, upward dividend momentum, and has quadrupled its top line since 2003.
28. Guess?, Inc. (GES)
Since 2007, my #1 apparel value has managed to boost its dividend (+150%) and revenue (+40%) at impressive rates, recession or not. I can’t wait to see what happens when the economy isn’t terrible.
29. Huaneng Power International, Inc. (HNP)
China’s largest independent electricity producer pays a 5.8% dividend (based on this year’s payout), has fantastic growth momentum (and even better growth prospects), and trades at just a 5% premium to its book value.
30. Textainer Group Holdings Limited (TGH)
The promising young dividend received three more increases in 2010, giving it a total of six since TGH went public three years ago. The stock now yields 3.8%.
31. Novartis AG (NVS)
Even with shares up 11% in December, Novartis remains my #1 pharmaceutical value heading into 2012. The company has given shareholders a double-digit raise in four consecutive years, averaging a 22% annual increase over that span.
32. Analog Devices, Inc. (ADI)
The analog chipmaker has recovered nicely from last year’s revenue decline, pushing its top line up by nearly 50% in 2010 thanks to a bounce in semiconductor demand and the revival of the auto industry. ADI has more than quintupled its dividend rate since 2003.
33. Merck & Co., Inc. (MRK)
Dividend growth has been non-existent for way too long. But revenue, expansion prospects, and margins are all looking up following the Schering-Plough acquisition, all of which should contribute to solving the flat dividend issue sooner than later.
34. Microchip Technology Inc. (MCHP)
Microchip carries by far the highest dividend yield (4.01%) among the many great chipmakers on this list, and continues to give shareholders a slight raise every quarter.
35. Ensco plc (ESV)
The offshore driller has a clean balance sheet, fantastic margins, and trades at a solid valuation. But most importantly, Ensco gave shareholders a 1300% raise in 2010, pushing its yield into relevancy (2.7%).
36. Yamana Gold Inc. (AUY)
It took a late-year plateau in the price of the precious metal and a few aggressive dividend developments, but I did manage to squeeze one gold play onto this list.
37. NewMarket Corporation (NEU)
NewMarket has increased its dividend rate by a staggering 252% since 2006. With solid revenue momentum and a forward payout ratio of just 13%, that fantastic dividend growth should continue.
38. Main Street Capital Corporation (MAIN)
Since its late-2007 IPO, Main Street has doubled both its revenue and shareholder equity. The stock trades at just 13x next year’s earnings with an 8.5% dividend yield.
39. China Mobile Ltd. (CHL)
Holds the world’s largest subscriber base and a dominant market position in China, where mobile penetration is still relatively low (60-65%). Trades at less than 11x earnings, which should only rise as CHL uses its scale to swallow up low-cost growth in rural areas.
40. Atlantic Tele-Network, Inc. (ATNI)
A late-year overreaction to disappointing 3Q results — coupled with a 13th consecutive year of dividend growth — has pushed ATNI’s dividend yield up to 2.4%. That’s well above the 1.59% it was paying coming into 2010.
41. Texas Instruments Incorporated (TXN)
Since holding its dividend rate flat from 1996 until 2004, TI has now increased it sixfold. The company also authorized the repurchase of $27.5 billion in stock over that same period, with nearly $20 billion completed before the stock began its recent surge (+40% since August).
42. Prospect Capital Corporation (PSEC)
The energy-focused BDC has achieved at least double-digit revenue growth every year since its 2004 IPO, carries zero debt, yields 11%, and trades right at tangible book value.
43. Sanderson Farms, Inc. (SAFM)
My top-ranked packaged food company sports a forward payout ratio of just 18% despite averaging 20% annual dividend growth since 2001.
44. Murphy Oil Corporation (MUR)
Murphy’s recent exploration success could allow it to blow its previous growth figures out of the water. Which is pretty impressive, considering the company has boosted its revenue by double-digits in seven of the last eight years.
45. Corning Incorporated (GLW)
Corning’s top line is making a nice recovery following a 2009 decline. The company is increasingly dependent on its display technology business, which isn’t necessarily a bad thing for the time being.
46. Pfizer Inc. (PFE)
Pfizer already has the widest economic moat in the pharmaceutical space. And depending on what it does with that $20 billion war chest, that economic moat will either get wider or get much wider.
47. UnitedHealth Group Inc. (UNH)
United finally made the leap to dividend relevance when it shifted from an annual payout of $0.03 per share to a quarterly dividend of $0.125 per share – a modest 1567% increase.
48. American Eagle Outfitters (AEO)
Shares of AEO fell about 15% this year despite the company’s 10% dividend hike, pushing the stock’s dividend yield over the 3% threshold heading into 2012.
49. Republic Bancorp, Inc. KY (RBCAA)
Even with its stock up 15% for the year and an inevitable decline in its important tax-loan segment on the horizon, Republic Bancorp remains the finest value among regional bank holding companies.
50. Cypress Sharpridge Investments, Inc. (CYS)
Cypress trades right around its tangible book value, where it carries the highest dividend yield (18%) on this list. (Be sure to factor December’s 14 million share offering into your research.)
51. Omega Healthcare Investors, Inc. (OHI)
The healthcare facility REIT yields 6.7% and is one of the few real estate companies to maintain strong dividend and earnings growth through the recession, yet it trades at just 11x next year’s earnings.
52. L-3 Communications Holdings, Inc. (LLL)
Dividend has received annual boosts averaging 27% since 2004, and yet forward payout ratio sits under 20%. L-3 will need that buffer to keep growing its dividend in the face of defense spending cuts, however.
53. The Andersons, Inc. (ANDE)
The diversified agriculture and transportation company seems to have recovered nicely from its 2009 revenue hiccup. The Andersons increased its dividend for the 14th consecutive year by handing shareholders a 22% raise in December.
54. Harris Corporation (HRS)
Harris has increased its dividend rate tenfold since 2002, but kept its forward payout ratio under 20% by tripling its revenue over the same period.
55. Advance America, Cash Advance Centers (AEA)
The largest payday loan generator in the country has pristine valuation metrics, including a forward P/E ratio of just 6, but regulatory concerns make it the ultimate risk/reward play. Investors will be paid handsomely (4.6% dividend yield) to stick it out.
56. The Buckle, Inc. (BKE)
Counting the monster year-end special dividends that have become an annual tradition, The Buckle has grown its dividend output tenfold since 2006.
57. Greif, Inc. (GEF)
Blows away its fellow container manufacturers in most metrics, but especially price/book (2.2) and debt/equity (0.8) ratios. Seven consecutive years of healthy dividend hikes have produced a 478% increase to Greif’s dividend rate and a 2.7% yield.
58. MCG Capital Corporation (MCGC)
Currently sporting an 8% yield, with a solid dividend hike likely looming. MCG has a 77% forward payout ratio in an industry required to return 90% of its taxable earnings to shareholders.
59. Xilinx, Inc. (XLNX)
Even after sharply downgrading its revenue outlook in December, Xilinx remains a solid value. Apparently I’m not the only one who sees it that way, as shares of XLNX actually went up in the days following the announcement.
60. DeVry Inc. (DV)
Even with their late-year push, shares of DV lost 15% of their value in 2010. They now sit below 10x the conservative 2012 earnings estimates laid out by regulation-wary analysts.
61. Microsoft Corporation (MSFT)
Unlike the Zune, Mr. Sofee’s successful transition to a dependable income investment (six straight years of double-digit dividend growth) should not be ignored.
62. RPC, Inc. (RES)
The oil and gas services company recovered nicely from last year’s dividend cut by raising its payout twice in 2010, exceeding earnings expectations, and splitting its stock.
63. Strayer Education, Inc. (STRA)
By far my most controversial pick of 2010, I recommended Strayer at $132 in October and I still think it has plenty of juice as it hovers around $160 today – more than $100 short of its 52-week high.
64. Nucor Corporation (NUE)
Since 2005 alone, the steel giant has raised its dividend rate by 383% and paid an additional $4.785 per share in special payouts.
65. PennantPark Investment Corp. (PNNT)
The last time shares of PNNT traded this high was 2007, when the company was generating half as much revenue and wasn’t even profitable.
66. ConocoPhillips (COP)
Recent acquisitions were poorly-timed, resulting in a rough couple of years for the energy giant. On the bright side, the stock barely trades at 10x next year’s earnings, and sports a dividend yield (3.30%) that blows away its five-year average (2.70%).
67. Sunoco Logistics Partners L.P. (SXL)
The success SXL has achieved since being spun-off from Sunoco in 2002 could be hard to replicate moving forward, but anything close would just be gravy on top of that solid 5.7% dividend yield.
68. Eli Lilly & Co. (LLY)
Facing a steep patent cliff, the company opted not to raise its dividend in 2010 for the first time in 42 years. Here’s to hoping they use the capital to juice their earnings in one way (R&D) or another (M&A).
69. Occidental Petroleum Corporation (OXY)
Ten dividend increases — including seven of at least 10% — since 2003 have boosted the company’s payout by a total of 268%. Yet it still maintains a payout ratio under 30%.
70. Triangle Capital Corporation (TCAP)
Shares of TCAP continue to establish new highs as the year comes to a close, yet they still sport a 9% yield thanks to the BDC’s aggressive dividend growth (nine raises for a total increase of 180% since 2007).
71. PPL Corporation (PPL)
The energy and utility holding company delivers electricity to customers from Montana to England, pays a dividend yield of more than 5%, and has raised its payout in nine consecutive years.
72. Meadbowbrook Insurance Group, Inc. (MIG)
Priced at less than book value and under 10x next year’s earnings, Meadowbrook is an excellent value with strong dividend growth prospects.
73. MFA Financial, Inc. (MFA)
My only complaint about this mortgage-centric REIT is the inconsistency of its dividend, which has upward momentum but tends to meander slightly from quarter to quarter. That still produces a yield in the 10-12% range, however.
74. AFLAC Incorporated (AFL)
Shareholders continue to benefit from Aflac’s competitive pricing, achieved by offering its products at the workplace rather than targeting individuals. The company has tripled its payout since 2003, and given shareholders a raise in 28 consecutive years.
75. Dynex Capital (DX)
Very comparable to MFA Financial. You’ll pay a higher earnings multiple to get a little less yield (10%), but the dividends are more consistent and a little better covered.
76. KLA-Tencor Corporation (KLAC)
Current yield (2.53%) isn’t nearly as attractive as it was before the stock rose 40% over the second half of the year. But the company has more than doubled its dividend since 2006, and is on pace to double its revenue this year, so don’t expect that return to lag for long.
77. Maiden Holdings, Ltd. (MHLD)
The reinsurance provider is trading at a 24% discount to book value and less than 7x next year’s earnings, and carries a 3.5% dividend yield to boot.
78. Canadian Natural Resource Ltd. (CNQ)
Revenue is bouncing back nicely from its 2009 drop, and the board of directors isn’t being stingy with the returns, doubling the dividend rate in May.
79. Exxon Mobil Corporation (XOM)
Exxon’s first year of sub-5% dividend growth since 2002 is an anomaly, not an issue. The company still possesses a low forward payout ratio (27%), and its yield (2.4%) sits well above its five year average (1.9%).
80. Global Partners LP (GLP)
Has averaged a 24% return on equity since going public in 2005, allowing the company to push the limits of its payout ratio in favor of a fat 7% dividend yield.
81. American Equity Investment Life Holding (AEL)
The fixed annuity and life insurance underwriter has given shareholders a double-digit raise every year since initiating its dividend in 2003, and currently trades at a healthy discount to tangible book value.
82. CenturyLink, Inc. (CTL)
Qwest merger should be completed early in 2012, which will undoubtedly push payout ratio into more manageable territory, buoying the current 6% dividend yield.
83. Stryker Corporation (SYK)
My #1 medical equipment/supplies value heading into 2012. Has better revenue momentum and payout ratio than Medtronic, which should keep its streak of 11 straight years with double-digit dividend growth rolling.
84. ACE Limited (ACE)
This insurance/reinsurance company has managed to push its yield above 2% through 18 consecutive years of dividend growth, all while keeping its forward payout ratio under 18%. And it’s currently trading at less than book value and just 8x future earnings.
85. Magna International Inc. (MGA)
A huge beneficiary of the auto rebound, Magna seems to have fully recovered from its dividend suspension. Stock is constantly threatening its all-time high, yet still trades at just 1.6x book value and 11x future earnings.
86. CapLease, Inc. (LSE)
It may be a while before the office space REIT achieves a dividend rate in the ballpark of its 2009 peak. But the current 4.4% yield isn’t too shabby in the meantime, especially coming from a stock that will only set you back about 8x future earnings.
87. Montpelier Re Holdings Ltd. (MRH)
Montpelier has averaged a 25% annual return on shareholder equity since its 2002 IPO. The stock is currently trading at a 20% discount to tangible book value, with a 2% dividend yield
88. Capital One Financial Corp. (COF)
Capital One was one of the many financial companies to slash its dividend during the crisis, and yet its payout is still nearly double its stable 1995-2007 level. Trades at a much steeper discount to book value than similar institutions.
89. Bunge Limited (BG)
Has increased its dividend by an annual average of 11% since it began returning cash to shareholders, and that shouldn’t slow down any time soon. Earnings have much greater momentum, keeping forward payout ratio below 20%.
90. Applied Materials, Inc. (AMAT)
This young payout produces a 2% yield, with plenty of upside. Currently pays just 21% of future earnings to shareholders, despite more than doubling dividend rate since 2005 inception.
91. Walgreen Company (WAG)
A solid value with a payout in danger of plateauing: dividend rate has grown more than twice as fast as sales over the last six years, which obviously can’t continue forever.
92. Walter Energy, Inc. (WLT)
The coal producer’s breakout 2010 (revenue is on pace to grow by 70%) will support its aggressive dividend growth, possibly even pushing it into meaningful territory. The company has doubled its dividend rate since 2008, but still holds a forward payout ratio under 5%
93. Westwood Holdings Group, Inc. (WHG)
Even without counting the special dividends sprinkled in from time to time, WHG has improved its dividend rate by an average of 70% annually since 2003. But you’ll pay for the growth, as the stock currently commands the highest earnings multiple (23.7) among the 100 on this list.
94. Thor Industries, Inc. (THO)
Shares took a double-digit tumble following Thor’s disappointing Q1 earnings report. which proved to be a quality buying opportunity, as the stock has since recovered to its pre-earnings level. A lot hinges on the success of the Heartland RV acquisition, so watch closely.
95. Vodafone Group Plc (VOD)
Net of fees, the mobile communications giant has more than quadrupled its dividend since 2003, pushing the stock’s yield to nearly 5%. Acquiring shares of VOD will currently cost you less than book value, and a little under 10x future earnings.
96. CME Group, Inc. (CME)
After giving shareholders a raise of at least 30% in each of its first five years as a dividend-paying company, CME held its payout flat through the recession. Can it regain its momentum? Taking a chance will barely cost you book value.
97. Medtronic, Inc. (MDT)
Shareholders should be thrilled if the next two decades are even half as good as the last two, which produced average annual dividend growth of 20%. Oh, and the stock went up more than 1200% as well.
98. Best Buy Co., Inc. (BBY)
Shares plunged more than 18% following the electronics retailer’s final earnings report of 2010, and now trade at less than 10x future earnings. The dividend has doubled since its 2003 inception, and is primed for more growth with a forward payout ratio of just 16%.
99. AstraZeneca plc (AZN)
Priced at just 7x future earnings amid a struggle to win FDA approval for Brilinta, the ultra-efficient AZN will be paying its shareholders a well-covered 5% dividend yield while they wait for their shares to bounce back.
100. Franklin Resources, Inc. (BEN)
The investment management company may not feature an impressive yield (0.87%), but it’s not for a lack of trying. With 30 consecutive years of dividend growth, including a quadrupling of its payout over the last decade, BEN is a classic low-yield, high-growth dividend play.
It’s important to realize that these aren’t the 100 stocks I think are most likely to bring home explosive returns during 2012, because I don’t invest with that short of a window in mind. They represent the 100 companies I think are the most attractively-priced for long-term returns as we close the book on 2010.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 1. Vale S.A. (VALE)
Even after rising during the final days of 2010, shares of VALE still trade below 8x future earnings. Dividend has tripled since its 2007 valley, and has plenty of room to grow thanks to a forward payout ratio of just 11% and a top line on pace to nearly double this year.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 2. Tower Group, Inc. (TWGP)
Tower’s revenue and dividend rate have both quintupled since 2006, and neither seem to be losing momentum. Trades at a slight discount to book value and just 7.5x future earnings.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 3. CNOOC Limited (CEO)
Trades at 11x future earnings and carries very little risk thanks to a huge regulatory advantage. Has the exclusive right to share in the production of China’s offshore resources when discovered by a foreign firm, shielding CNOOC from local exploration costs.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 4. Knightsbridge Tankers Limited (VLCCF)
Dividend has recovered nicely from 2009′s cut, and is now paying nearly 9% as shares have failed to properly react to improved prospects. Company secured a $175 million credit facility in 2010 that will enable the purchase of a ninth vessel without raising additional equity.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 5. Life Partners Holdings, Inc. (LPHI)
Looked like it was finally heading toward a proper valuation before a string of bad press held shares down. With zero debt, a 5.3% dividend yield, and a forward earnings multiple of just 7.4, an investment in this unconventional business possesses a huge margin of safety.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 6. Diamond Offshore Drilling, Inc. (DO)
Diamond Offshore has supplemented its modest regular dividend with 15 special payouts since 2006, returning an incredible total of $27.13 per share to stockholders over that span (or 41% of its current share price).
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 7. Jinpan International Limited (JST)
The Chinese manufacturer split its shares and tossed shareholders a 17% dividend hike this year, with little reaction from the market. Will close 2010 with a yield of 1.3%, much better than the 0.49% it opened the year with.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 8. Amtrust Financial Services (AFSI)
Shares deservedly surged over the second half of the year (+46%), but still trade at just 1.5x book value and 7x expected 2012 earnings. Dividend has quadrupled since 2006, yet forward payout ratio remains at just 13%.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 9. Annaly Capital Management, inc. (NLY)
By far the best value for your REIT-buying dollar. That is, if you’re looking for a REIT that managed to improve its dividend every year through the recession, currently yields 14%, and will set you back less than 7x next year’s earnings.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 10. Fifth Street Finance Corp. (FSC)
The most attractively-priced BDC has only been public since 2008, but it sports an under-leveraged balance sheet, a 10% dividend yield, and trades at only a slight premium to its tangible book value.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 11. Lincoln Education Services Corporation (LINC)
Lincoln instantly became the best dividend-paying value in the for-profit education industry when it declared its first payout in November. Yields 6.4% and trades at 7x next year’s conservative earnings consensus.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 12. Chevron Corporation (CVX)
The best value among the integrated energy giants trades at just 9x next year’s earnings, compared to 10.6 for ConocoPhillips and 11.3 for ExxonMobil.
13. BHP Billiton Limited (BHP)
The Australian mining giant is diversified enough to weather the volatile commodity markets, and rich enough to acquire growth while returning an increasingly-substantial amount of cash to shareholders.
The 100 Best Values Among Dividend-Paying Stocks to invest 2012 14. PartnerRe Ltd. (PRE)
Trades at a 20% discount to book value, and the international reinsurer has raised its dividend every year since 1994 – increasing its rate by a total of 450% during that span.
15. Seadrill Limited (SDRL)
The offshore driller has achieved double-digit top line growth every year since going public in 2005, and is currently on pace to triple its 2006 revenue.
16. Intel Corporation (INTC)
A flat year leaves Intel shares with a dividend yield (3.43%) well above its five-year average (2.30%), thanks to the giant chipmaker’s biggest dividend hike since 2006.
17. Alliance Resources Partners, L.P. (ARLP)
Trades at 9x future earnings, yields 5%, has tripled its dividend rate since 2003, and raised its payout for 11 straight quarters.
18. Acme United Corporation (ACU)
An income investor’s dream: Stock is undervalued (1.2x book, 9.4x future earnings), current yield is solid (2.4%), payout ratio remains low (23%), and commitment to dividend growth is clear (boosted rate by an average of 16% annually since 2005).
19. CF Industries Holdings, Inc. (CF)
With revenue and earnings on pace to beat last year’s figures by 50% and the fertilizer company’s forward payout ratio now below 4%, it’s about time for another monster dividend hike from CF, which quintupled its payout in 2008.
20. Suncor Energy Inc. (SU)
Added earning power from Petro-Canada acquisition enabled Suncor to double its dividend without pushing its forward payout ratio over the 20% threshold.
21. Marathon Oil Corporation (MRO)
Despite an expected 23% jump in revenue, Marathon barely traded above book value in 2010. Its year-end price/book ratio (1.18), compares favorably to those of competitors Chevron (1.80), ConocoPhillips (1.44), and ExxonMobil (2.57).
22. VSE Corporation (VSEC)
If you know of any other companies with seven straight years of double-digit dividend growth, seven straight years of double-digit earnings growth, and a forward payout ratio under 5%, please fill me in.
23. TICC Capital Corp. (TICC)
If you’re looking for exposure to the tech industry but don’t want to sacrifice yield, TICC is worth looking into. The tech-focused BDC trades at just a 38% premium to tangible book value, carries no debt, and sports an 8.6% dividend yield.
24. National Presto Industries Inc. (NPK)
The do-it-all manufacturer (Skillets! Ammunition! Diapers!) currently carries a dividend rate seven times the amount paid to NPK shareholders in 2003. Revenue momentum, diversification, and overall financial efficiency should support continued dividend growth.
25. National Interstate Corporation (NATL)
With a forward payout ratio of just 16% despite getting annual raises that have averaged 19% since 2006, this dividend is primed for continued growth.
26. Archer Daniels Midland Company (ADM)
Shares scuffled enough this year to keep their forward earnings multiple under 10 and their yield above 2%, two figures you don’t expect when researching a company that’s quintupled its revenue over the last decade and raised its dividend for 35 consecutive years.
27. Compania de Minas Buenaventura SA (BVN)
Buenaventura offers exposure to both gold and silver, as well as zinc and lead. The Peruvian mining company has low production costs, very little debt, upward dividend momentum, and has quadrupled its top line since 2003.
28. Guess?, Inc. (GES)
Since 2007, my #1 apparel value has managed to boost its dividend (+150%) and revenue (+40%) at impressive rates, recession or not. I can’t wait to see what happens when the economy isn’t terrible.
29. Huaneng Power International, Inc. (HNP)
China’s largest independent electricity producer pays a 5.8% dividend (based on this year’s payout), has fantastic growth momentum (and even better growth prospects), and trades at just a 5% premium to its book value.
30. Textainer Group Holdings Limited (TGH)
The promising young dividend received three more increases in 2010, giving it a total of six since TGH went public three years ago. The stock now yields 3.8%.
31. Novartis AG (NVS)
Even with shares up 11% in December, Novartis remains my #1 pharmaceutical value heading into 2012. The company has given shareholders a double-digit raise in four consecutive years, averaging a 22% annual increase over that span.
32. Analog Devices, Inc. (ADI)
The analog chipmaker has recovered nicely from last year’s revenue decline, pushing its top line up by nearly 50% in 2010 thanks to a bounce in semiconductor demand and the revival of the auto industry. ADI has more than quintupled its dividend rate since 2003.
33. Merck & Co., Inc. (MRK)
Dividend growth has been non-existent for way too long. But revenue, expansion prospects, and margins are all looking up following the Schering-Plough acquisition, all of which should contribute to solving the flat dividend issue sooner than later.
34. Microchip Technology Inc. (MCHP)
Microchip carries by far the highest dividend yield (4.01%) among the many great chipmakers on this list, and continues to give shareholders a slight raise every quarter.
35. Ensco plc (ESV)
The offshore driller has a clean balance sheet, fantastic margins, and trades at a solid valuation. But most importantly, Ensco gave shareholders a 1300% raise in 2010, pushing its yield into relevancy (2.7%).
36. Yamana Gold Inc. (AUY)
It took a late-year plateau in the price of the precious metal and a few aggressive dividend developments, but I did manage to squeeze one gold play onto this list.
37. NewMarket Corporation (NEU)
NewMarket has increased its dividend rate by a staggering 252% since 2006. With solid revenue momentum and a forward payout ratio of just 13%, that fantastic dividend growth should continue.
38. Main Street Capital Corporation (MAIN)
Since its late-2007 IPO, Main Street has doubled both its revenue and shareholder equity. The stock trades at just 13x next year’s earnings with an 8.5% dividend yield.
39. China Mobile Ltd. (CHL)
Holds the world’s largest subscriber base and a dominant market position in China, where mobile penetration is still relatively low (60-65%). Trades at less than 11x earnings, which should only rise as CHL uses its scale to swallow up low-cost growth in rural areas.
40. Atlantic Tele-Network, Inc. (ATNI)
A late-year overreaction to disappointing 3Q results — coupled with a 13th consecutive year of dividend growth — has pushed ATNI’s dividend yield up to 2.4%. That’s well above the 1.59% it was paying coming into 2010.
41. Texas Instruments Incorporated (TXN)
Since holding its dividend rate flat from 1996 until 2004, TI has now increased it sixfold. The company also authorized the repurchase of $27.5 billion in stock over that same period, with nearly $20 billion completed before the stock began its recent surge (+40% since August).
42. Prospect Capital Corporation (PSEC)
The energy-focused BDC has achieved at least double-digit revenue growth every year since its 2004 IPO, carries zero debt, yields 11%, and trades right at tangible book value.
43. Sanderson Farms, Inc. (SAFM)
My top-ranked packaged food company sports a forward payout ratio of just 18% despite averaging 20% annual dividend growth since 2001.
44. Murphy Oil Corporation (MUR)
Murphy’s recent exploration success could allow it to blow its previous growth figures out of the water. Which is pretty impressive, considering the company has boosted its revenue by double-digits in seven of the last eight years.
45. Corning Incorporated (GLW)
Corning’s top line is making a nice recovery following a 2009 decline. The company is increasingly dependent on its display technology business, which isn’t necessarily a bad thing for the time being.
46. Pfizer Inc. (PFE)
Pfizer already has the widest economic moat in the pharmaceutical space. And depending on what it does with that $20 billion war chest, that economic moat will either get wider or get much wider.
47. UnitedHealth Group Inc. (UNH)
United finally made the leap to dividend relevance when it shifted from an annual payout of $0.03 per share to a quarterly dividend of $0.125 per share – a modest 1567% increase.
48. American Eagle Outfitters (AEO)
Shares of AEO fell about 15% this year despite the company’s 10% dividend hike, pushing the stock’s dividend yield over the 3% threshold heading into 2012.
49. Republic Bancorp, Inc. KY (RBCAA)
Even with its stock up 15% for the year and an inevitable decline in its important tax-loan segment on the horizon, Republic Bancorp remains the finest value among regional bank holding companies.
50. Cypress Sharpridge Investments, Inc. (CYS)
Cypress trades right around its tangible book value, where it carries the highest dividend yield (18%) on this list. (Be sure to factor December’s 14 million share offering into your research.)
51. Omega Healthcare Investors, Inc. (OHI)
The healthcare facility REIT yields 6.7% and is one of the few real estate companies to maintain strong dividend and earnings growth through the recession, yet it trades at just 11x next year’s earnings.
52. L-3 Communications Holdings, Inc. (LLL)
Dividend has received annual boosts averaging 27% since 2004, and yet forward payout ratio sits under 20%. L-3 will need that buffer to keep growing its dividend in the face of defense spending cuts, however.
53. The Andersons, Inc. (ANDE)
The diversified agriculture and transportation company seems to have recovered nicely from its 2009 revenue hiccup. The Andersons increased its dividend for the 14th consecutive year by handing shareholders a 22% raise in December.
54. Harris Corporation (HRS)
Harris has increased its dividend rate tenfold since 2002, but kept its forward payout ratio under 20% by tripling its revenue over the same period.
55. Advance America, Cash Advance Centers (AEA)
The largest payday loan generator in the country has pristine valuation metrics, including a forward P/E ratio of just 6, but regulatory concerns make it the ultimate risk/reward play. Investors will be paid handsomely (4.6% dividend yield) to stick it out.
56. The Buckle, Inc. (BKE)
Counting the monster year-end special dividends that have become an annual tradition, The Buckle has grown its dividend output tenfold since 2006.
57. Greif, Inc. (GEF)
Blows away its fellow container manufacturers in most metrics, but especially price/book (2.2) and debt/equity (0.8) ratios. Seven consecutive years of healthy dividend hikes have produced a 478% increase to Greif’s dividend rate and a 2.7% yield.
58. MCG Capital Corporation (MCGC)
Currently sporting an 8% yield, with a solid dividend hike likely looming. MCG has a 77% forward payout ratio in an industry required to return 90% of its taxable earnings to shareholders.
59. Xilinx, Inc. (XLNX)
Even after sharply downgrading its revenue outlook in December, Xilinx remains a solid value. Apparently I’m not the only one who sees it that way, as shares of XLNX actually went up in the days following the announcement.
60. DeVry Inc. (DV)
Even with their late-year push, shares of DV lost 15% of their value in 2010. They now sit below 10x the conservative 2012 earnings estimates laid out by regulation-wary analysts.
61. Microsoft Corporation (MSFT)
Unlike the Zune, Mr. Sofee’s successful transition to a dependable income investment (six straight years of double-digit dividend growth) should not be ignored.
62. RPC, Inc. (RES)
The oil and gas services company recovered nicely from last year’s dividend cut by raising its payout twice in 2010, exceeding earnings expectations, and splitting its stock.
63. Strayer Education, Inc. (STRA)
By far my most controversial pick of 2010, I recommended Strayer at $132 in October and I still think it has plenty of juice as it hovers around $160 today – more than $100 short of its 52-week high.
64. Nucor Corporation (NUE)
Since 2005 alone, the steel giant has raised its dividend rate by 383% and paid an additional $4.785 per share in special payouts.
65. PennantPark Investment Corp. (PNNT)
The last time shares of PNNT traded this high was 2007, when the company was generating half as much revenue and wasn’t even profitable.
66. ConocoPhillips (COP)
Recent acquisitions were poorly-timed, resulting in a rough couple of years for the energy giant. On the bright side, the stock barely trades at 10x next year’s earnings, and sports a dividend yield (3.30%) that blows away its five-year average (2.70%).
67. Sunoco Logistics Partners L.P. (SXL)
The success SXL has achieved since being spun-off from Sunoco in 2002 could be hard to replicate moving forward, but anything close would just be gravy on top of that solid 5.7% dividend yield.
68. Eli Lilly & Co. (LLY)
Facing a steep patent cliff, the company opted not to raise its dividend in 2010 for the first time in 42 years. Here’s to hoping they use the capital to juice their earnings in one way (R&D) or another (M&A).
69. Occidental Petroleum Corporation (OXY)
Ten dividend increases — including seven of at least 10% — since 2003 have boosted the company’s payout by a total of 268%. Yet it still maintains a payout ratio under 30%.
70. Triangle Capital Corporation (TCAP)
Shares of TCAP continue to establish new highs as the year comes to a close, yet they still sport a 9% yield thanks to the BDC’s aggressive dividend growth (nine raises for a total increase of 180% since 2007).
71. PPL Corporation (PPL)
The energy and utility holding company delivers electricity to customers from Montana to England, pays a dividend yield of more than 5%, and has raised its payout in nine consecutive years.
72. Meadbowbrook Insurance Group, Inc. (MIG)
Priced at less than book value and under 10x next year’s earnings, Meadowbrook is an excellent value with strong dividend growth prospects.
73. MFA Financial, Inc. (MFA)
My only complaint about this mortgage-centric REIT is the inconsistency of its dividend, which has upward momentum but tends to meander slightly from quarter to quarter. That still produces a yield in the 10-12% range, however.
74. AFLAC Incorporated (AFL)
Shareholders continue to benefit from Aflac’s competitive pricing, achieved by offering its products at the workplace rather than targeting individuals. The company has tripled its payout since 2003, and given shareholders a raise in 28 consecutive years.
75. Dynex Capital (DX)
Very comparable to MFA Financial. You’ll pay a higher earnings multiple to get a little less yield (10%), but the dividends are more consistent and a little better covered.
76. KLA-Tencor Corporation (KLAC)
Current yield (2.53%) isn’t nearly as attractive as it was before the stock rose 40% over the second half of the year. But the company has more than doubled its dividend since 2006, and is on pace to double its revenue this year, so don’t expect that return to lag for long.
77. Maiden Holdings, Ltd. (MHLD)
The reinsurance provider is trading at a 24% discount to book value and less than 7x next year’s earnings, and carries a 3.5% dividend yield to boot.
78. Canadian Natural Resource Ltd. (CNQ)
Revenue is bouncing back nicely from its 2009 drop, and the board of directors isn’t being stingy with the returns, doubling the dividend rate in May.
79. Exxon Mobil Corporation (XOM)
Exxon’s first year of sub-5% dividend growth since 2002 is an anomaly, not an issue. The company still possesses a low forward payout ratio (27%), and its yield (2.4%) sits well above its five year average (1.9%).
80. Global Partners LP (GLP)
Has averaged a 24% return on equity since going public in 2005, allowing the company to push the limits of its payout ratio in favor of a fat 7% dividend yield.
81. American Equity Investment Life Holding (AEL)
The fixed annuity and life insurance underwriter has given shareholders a double-digit raise every year since initiating its dividend in 2003, and currently trades at a healthy discount to tangible book value.
82. CenturyLink, Inc. (CTL)
Qwest merger should be completed early in 2012, which will undoubtedly push payout ratio into more manageable territory, buoying the current 6% dividend yield.
83. Stryker Corporation (SYK)
My #1 medical equipment/supplies value heading into 2012. Has better revenue momentum and payout ratio than Medtronic, which should keep its streak of 11 straight years with double-digit dividend growth rolling.
84. ACE Limited (ACE)
This insurance/reinsurance company has managed to push its yield above 2% through 18 consecutive years of dividend growth, all while keeping its forward payout ratio under 18%. And it’s currently trading at less than book value and just 8x future earnings.
85. Magna International Inc. (MGA)
A huge beneficiary of the auto rebound, Magna seems to have fully recovered from its dividend suspension. Stock is constantly threatening its all-time high, yet still trades at just 1.6x book value and 11x future earnings.
86. CapLease, Inc. (LSE)
It may be a while before the office space REIT achieves a dividend rate in the ballpark of its 2009 peak. But the current 4.4% yield isn’t too shabby in the meantime, especially coming from a stock that will only set you back about 8x future earnings.
87. Montpelier Re Holdings Ltd. (MRH)
Montpelier has averaged a 25% annual return on shareholder equity since its 2002 IPO. The stock is currently trading at a 20% discount to tangible book value, with a 2% dividend yield
88. Capital One Financial Corp. (COF)
Capital One was one of the many financial companies to slash its dividend during the crisis, and yet its payout is still nearly double its stable 1995-2007 level. Trades at a much steeper discount to book value than similar institutions.
89. Bunge Limited (BG)
Has increased its dividend by an annual average of 11% since it began returning cash to shareholders, and that shouldn’t slow down any time soon. Earnings have much greater momentum, keeping forward payout ratio below 20%.
90. Applied Materials, Inc. (AMAT)
This young payout produces a 2% yield, with plenty of upside. Currently pays just 21% of future earnings to shareholders, despite more than doubling dividend rate since 2005 inception.
91. Walgreen Company (WAG)
A solid value with a payout in danger of plateauing: dividend rate has grown more than twice as fast as sales over the last six years, which obviously can’t continue forever.
92. Walter Energy, Inc. (WLT)
The coal producer’s breakout 2010 (revenue is on pace to grow by 70%) will support its aggressive dividend growth, possibly even pushing it into meaningful territory. The company has doubled its dividend rate since 2008, but still holds a forward payout ratio under 5%
93. Westwood Holdings Group, Inc. (WHG)
Even without counting the special dividends sprinkled in from time to time, WHG has improved its dividend rate by an average of 70% annually since 2003. But you’ll pay for the growth, as the stock currently commands the highest earnings multiple (23.7) among the 100 on this list.
94. Thor Industries, Inc. (THO)
Shares took a double-digit tumble following Thor’s disappointing Q1 earnings report. which proved to be a quality buying opportunity, as the stock has since recovered to its pre-earnings level. A lot hinges on the success of the Heartland RV acquisition, so watch closely.
95. Vodafone Group Plc (VOD)
Net of fees, the mobile communications giant has more than quadrupled its dividend since 2003, pushing the stock’s yield to nearly 5%. Acquiring shares of VOD will currently cost you less than book value, and a little under 10x future earnings.
96. CME Group, Inc. (CME)
After giving shareholders a raise of at least 30% in each of its first five years as a dividend-paying company, CME held its payout flat through the recession. Can it regain its momentum? Taking a chance will barely cost you book value.
97. Medtronic, Inc. (MDT)
Shareholders should be thrilled if the next two decades are even half as good as the last two, which produced average annual dividend growth of 20%. Oh, and the stock went up more than 1200% as well.
98. Best Buy Co., Inc. (BBY)
Shares plunged more than 18% following the electronics retailer’s final earnings report of 2010, and now trade at less than 10x future earnings. The dividend has doubled since its 2003 inception, and is primed for more growth with a forward payout ratio of just 16%.
99. AstraZeneca plc (AZN)
Priced at just 7x future earnings amid a struggle to win FDA approval for Brilinta, the ultra-efficient AZN will be paying its shareholders a well-covered 5% dividend yield while they wait for their shares to bounce back.
100. Franklin Resources, Inc. (BEN)
The investment management company may not feature an impressive yield (0.87%), but it’s not for a lack of trying. With 30 consecutive years of dividend growth, including a quadrupling of its payout over the last decade, BEN is a classic low-yield, high-growth dividend play.
The top 5 Oil Stocks to invest in 2012
Below is a list of my latest oil stock picks for 2012. These 2012 Oil Stock Picks are my favor stocks to buy and some of the stocks I will be trading personally. Last year, one of my top oil stock picks was Brigham Exploration (BEXP). BEXP stock went from $15 to $27 from July to December of 2012 and was one of my biggest stock gainers of the year. I feel 2012 will be a good year for stocks and the overall stock market. Oil in 2012 should hit $110-$120 which would make the oil stocks rally even higher.
Key Areas of Oil Exploration in 2012 – Eagle Ford Shale – Niobrara Shale – Bakken Shale – Permian Basin – Oil Discoveries are still going on in these fields and in 2012, more Oil Discoveries will be made. Keep an eye on the Chainman Shale – Cabot Oil & Gas (COG) mentioned in late 2012 that they are drilling for oil in the Chainman Shale. We also have Venoco (VQ) drilling the Monterey Shale in California. With that, here is a list of my best oil stock picks for 2012
#1 Top Oil Stock Pick 2012 – Oil Stocks – Hyperdynamics Corporation (HDY) – While Hyperdynamics (HDY) is my top stock pick of 2012, it is a risky one. The company has no revenues and does not make any money but could be sitting on a very large pool of oil off the coast of Africa. Drilling for oil is expected to begin in December 2012. Hyperdynamics was headed into a downward spiral over the past couple years but changed the management team in 2012 who vowed to take the company in a new direction. Hyperdynamics has a very large prospective leased area off the coast of the Republic of Guinea. In November 2012, Hyperdynamics raised $30 million in a private placement from financial giant Blackrock (BLK) which will help in preperation costs to drill for oil in late 2012. Hyperdynamics did a few surveys and believe they could be sitting on billions of barrels of oil.
As for HDY stock in 2012, It is my top stock to buy and my best trading idea. I have been trading HDY since the stock was $1.60 in August 2012 and gave it a price target of $4 – $6 for 2012. HDY hit a high of $3.63 in October 2012 and continues to trade around $3.00 as we head into 2012. If everything goes as planned and the company does infact sit on top of a large oil pool, we could be looking at a $8-$10 stock by year end 2012 in my opinion. I gave it a target of $4 – $6 when the stock was hitting $2.60 just to be on the conservative side. Of coarse, if Hyperdynamics announces any delays or lesser oil reserves, all bets are off. Pullbacks below $2.50 should be a great buy if you are looking for an entry point. I currently own HDY stock for the long term and will buy more stock on pullbacks. If you have any questions or feel like discussing HDY stock, visit my HDY message forum thread.
#2 Top Oil Stock Pick for 2012 – Kodiak Oil & Gas (KOG) – Kodiak Oil & Gas was another huge stock gainer for me at the end of 2012. I bought KOG stock at $4.30 in mid November 2012 and sold between $5.00-$5.70 a month later. KOG went on to hit $6.69 a few weeks later. Kodiak Oil in Gas recently aquired additional acreage in the Bakken Shale. This acreage is in some of the best zones in the Bakken which includes the Three Forks Oil zone. When I originally bought KOG at $4.30, I placed a personal target of $8-$10 on it for 2012. I am sticking with this and feel the stock could even hit $12. A lot will depend on what oil does but ultimately the stock is going a lot higher. While I don’t own KOG right now, I plan to buy the stock on any major correction.
Key Areas of Oil Exploration in 2012 – Eagle Ford Shale – Niobrara Shale – Bakken Shale – Permian Basin – Oil Discoveries are still going on in these fields and in 2012, more Oil Discoveries will be made. Keep an eye on the Chainman Shale – Cabot Oil & Gas (COG) mentioned in late 2012 that they are drilling for oil in the Chainman Shale. We also have Venoco (VQ) drilling the Monterey Shale in California. With that, here is a list of my best oil stock picks for 2012
#1 Top Oil Stock Pick 2012 – Oil Stocks – Hyperdynamics Corporation (HDY) – While Hyperdynamics (HDY) is my top stock pick of 2012, it is a risky one. The company has no revenues and does not make any money but could be sitting on a very large pool of oil off the coast of Africa. Drilling for oil is expected to begin in December 2012. Hyperdynamics was headed into a downward spiral over the past couple years but changed the management team in 2012 who vowed to take the company in a new direction. Hyperdynamics has a very large prospective leased area off the coast of the Republic of Guinea. In November 2012, Hyperdynamics raised $30 million in a private placement from financial giant Blackrock (BLK) which will help in preperation costs to drill for oil in late 2012. Hyperdynamics did a few surveys and believe they could be sitting on billions of barrels of oil.
As for HDY stock in 2012, It is my top stock to buy and my best trading idea. I have been trading HDY since the stock was $1.60 in August 2012 and gave it a price target of $4 – $6 for 2012. HDY hit a high of $3.63 in October 2012 and continues to trade around $3.00 as we head into 2012. If everything goes as planned and the company does infact sit on top of a large oil pool, we could be looking at a $8-$10 stock by year end 2012 in my opinion. I gave it a target of $4 – $6 when the stock was hitting $2.60 just to be on the conservative side. Of coarse, if Hyperdynamics announces any delays or lesser oil reserves, all bets are off. Pullbacks below $2.50 should be a great buy if you are looking for an entry point. I currently own HDY stock for the long term and will buy more stock on pullbacks. If you have any questions or feel like discussing HDY stock, visit my HDY message forum thread.
#2 Top Oil Stock Pick for 2012 – Kodiak Oil & Gas (KOG) – Kodiak Oil & Gas was another huge stock gainer for me at the end of 2012. I bought KOG stock at $4.30 in mid November 2012 and sold between $5.00-$5.70 a month later. KOG went on to hit $6.69 a few weeks later. Kodiak Oil in Gas recently aquired additional acreage in the Bakken Shale. This acreage is in some of the best zones in the Bakken which includes the Three Forks Oil zone. When I originally bought KOG at $4.30, I placed a personal target of $8-$10 on it for 2012. I am sticking with this and feel the stock could even hit $12. A lot will depend on what oil does but ultimately the stock is going a lot higher. While I don’t own KOG right now, I plan to buy the stock on any major correction.
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