Introducing the Dividend Portfolio – 10 Dividend Stocks for the Enterprising Investor
On the first Friday of every month, we will screen our database for the 10 companies with the highest dividend yield that are suitable for the enterprising investor. These 10 companies will be placed in a mock portfolio and rebalanced to have a 10% allocation to each company. The starting value of the portfolio is $100,000.00. Dividends will be reinvested in the portfolio.
To see the portfolio, you can view this google spreadsheet.
This month, the screen resulted in the following companies being targeted:
- Psychemedics Corp (PMD) – 20.97%
- B&G Foods Inc (BGS) – 8.30%
- Bristol-Myers Squibb (BMY) – 6.88%
- International Shipholding Corp (ISH) – 6.49%
- National Presto Industries (NPK) – 6.42%
- Pfizer Inc (PFE) – 5.80%
- E.I. du Pont de Nemours and Co (DD) – 5.10%
- General Electric (GE) – 4.99%
- Merck & Co. (MRK) – 4.81%
- Olin Corp (OLN) – 4.59%
The following transactions were made this month:
- Bought 1613 shares of PMD for $10,000.60.
- Bought 1221 shares of BGS for $9,999.99.
- Bought 444 shares of BMY for $9,998.88.
- Bought 325 shares of ISH for $10,013.25.
- Bought 115 shares of NPK for $9,948.65.
- Bought 604 shares of PFE for $9,996.20.
- Bought 311 shares of DD for $9,995.54.
- Bought 609 shares of GE for $9,999.78.
- Bought 316 shares of MRK for $9,995.08.
- Bought 573 shares of OLN for $9,993.12.
Photo provided by Acomment.
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[...] 10 Dividend Stocks for the Enterprising Investor [...]
Are you using any other screening methods or just stocks with high yields?
Thanks,
stockmanmarc
Stockmanmarc,
Thanks for the comment.
The first screen is whether or not the company passes the tests for the enterprising investor. You can view the companies in our database that have passed this test here: http://www.moderngraham.com/?page_id=365
Here are the criteria. I’ve listed the defensive investor tests also, as any company suitable for the defensive investor would be suitable for the enterprising investor.
Defensive Investor – must pass at least 6 of the following 7 tests:
1. Adequate Size of Enterprise – market capitalization of at least $2 billion
2. Sufficiently Strong Financial Condition – current ratio greater than 2
3. Earnings Stability – positive earnings per share for at least 10 straight years
4. Dividend Record – has paid a dividend for at least 10 straight years
5. Earnings Growth – earnings per share has increased by at least 1/3 over the last 10 years using 3 year averages at beginning and end of period
6. Moderate PEmg ratio – PEmg is less than 20
7. Moderate Price to Assets – PB ratio is less than 2.5 or PB x PEmg is less than 50
Enterprising Investor – must pass at least 4 of the following 5 tests:
1. Sufficiently Strong Financial Condition, Part 1 – current ratio greater than 1.5
2. Sufficiently Strong Financial Condition, Part 2 – Debt to Net Current Assets ratio less than 1.1
3. Earnings Stability – positive earnings per share for at least 5 years
4. Dividend Record – currently pays a dividend
5. Earnings growth – EPSmg greater than 5 years ago