If you like what you read, check out my first book, My Happy Assets at http://www.myhappyassets.com/ and the complete second book,Small Business Coffee Hour, Three Essential Ingredients for a Successful Business athttp://www.smallbizcoffee.com/. Happy Reading!
______________________________________________________________
If you are interested in generating cash flow from dividends, the screen below will help you identify stocks that are fertile with yield and ripe for investment.
| Measure | Formula | What to Look For |
| Dividend Yield | Dividend per share divided by stock price | Yield at least equal to that of the S&P 500 and not out of line with that of the S&P industry yield. Use 8-20%(anything above is bad news) |
| Price to earnings ratio | Stock Price Divided by per-share earnings | P/E that is not excessive compared with company's historical P/E and with S&P industry P/E |
| Cash flow per share | Net income plus depreciation and amortization divided by number of shares outstanding | Should be at least three times dividend payment |
| Quick ratio | Current assets minus inventory divided by current liabilities | Should be at least 1.0 |
| Payout ratio | Per-share dividends divided by per-share earnings | Should be higher than 50% but not exceed 100% |
| Dividend coverage ratio | Cash flow per share divided by dividends per share | Minimum should be 120% |
| Short-term debt coverage ratio | Operating income divided by short-term debt | Should be at least 2.0 |
| Market Cap | This is the overall market capitalization of a company. | >= $1 billion. Traditionally, larger caps are steadier in their payouts. |
| ROE | Return on Equity | >= 10% |
| The Fundamental Grade | Stock Scouter | > = C |
| Institutional Ownership | What % of big funds own the company. | > = 30 % |
| Mean Recommendation | Buy, Hold or sell? | > = Hold from analysts |
| EPS Growth Next Year | How much will earnings grow? | > = 1 |
Posts
No comments:
Post a Comment