The goal of dividend investing is to find and buy dividend growth stocks that will continue to raise their dividends. To pay and raise its dividend a company must generate sufficient free cash flow. However, it is not enough to just generate the cash, it has to be available for dividend payments. Many companies generate significant free cash flow, but often that cash is already spoken for in the form of debt obligations.
This week I am screening my database for low debt-to-total-capital stocks. Debt includes both long-term and short-term debt. Total capital is a combination of debt and shareholders equity. When you divide debt by total capital a desirable rate is something less than 35%, but I will consider rates up to 50% on a short-term basis. Obviously, this is not a buy list but a potential idea list that will require additional due diligence.
Below are 13 stocks with debt that have a low debt-to-total-capital ratio:
- 9.6% Chevron Corporation (CVX) | Yield: 3.0%
- 9.1% UGI Corporation (UGI) | Yield: 3.2%
- 9.0% Exxon Mobil Corporation (XOM) | Yield: 2.2%
- 8.4% HCC Insurance Holdings Inc. (HCC) | Yield: 1.8%
- 8.2% SEI Investments Corp. (SEI) | Yield: 0.9%
- 7.2% Badger Meter, Inc. (BMI) | Yield: 1.5%
- 4.1% Intel Corporation (INTC) | Yield: 3.5%
- 4.0% UMB Financial Corporation (UMBF) | Yield: 1.9%
- 2.7% Weyco Group, Inc. (WEYS) | Yield: 3.4%
- 3.0% AFLAC Incorporated (BPL) | Yield: 2.5%
- 2.1% Clarcor Inc. Comm (CLC) | Yield: 1.0%
- 1.2% Tootsie Roll Industries Inc. (TR) | Yield: 1.1%
- 0.6% Automatic Data Processing Inc. (ADP) | Yield: 2.6%
The data present above is in its raw form. Many of the companies I would disqualify due to a low yield. However some of the others may be worth a second look.
My database, D4L-Data, is an Open Office spreadsheet containing more than 20 columns of information on the 200+ companies that I track. The data is sortable and has built-in buttons and macros to make it easy to use. Companies included in the list are those that have had a history of dividend growth. The D4L-Data spreadsheet is a part of D4L-Premium Services and is updated each Saturday for subscribers.
Full Disclosure: Long ADP, INTC. See a list of all my income holdings here.
- Don't Touch These 5 Dividend Stocks!
- 3 Dividend Stocks That I Will NEVER Lose Money On
- List of 195 Dividend Stocks Every Income Investor Should Know About
- These 11 Dividend Stocks Could Make You Wealthy
- 13 Dividend Stocks Headed In The Right Direction
Tags: [ADP] [TR] [CLC] [AFL] [WEYS] [UMBF] [INTC] [BMI] [SEIC] [HCC] [XOM] [UGI] [CVX]
Popular Posts - Last 7 days
Presented below are my dividend stock and ETF/CEF holdings. This is not a recommendation to buy these securities. I have classified some of...
I am a firm believer that asset allocation plays a significant part in a portfolio's long-term results. In the past, I was asked if you...
I have stated many times that my goal is to create an ever growing income stream from dividend growth stocks . Secondarily, it is my desire...
Linked here is a detailed quantitative analysis of Abbvie Inc. (ABBV). Below are some highlights from the above linked analysis: Company ...
Each Sunday I highlight any notable articles that I came across over the past week. Though I may not always agree with each of the articles ...
Linked here is a detailed quantitative analysis of General Mills, Inc. (GIS). Below are some highlights from the above linked analysis: C...
Linked here is a detailed quantitative analysis of Omega Healthcare Investors, Inc. (OHI). Below are some highlights from the above linked ...
Linked here is a detailed quantitative analysis of Verizon Communications Inc. (VZ). Below are some highlights from the above linked analys...
In everything we do, we always want to be the best or be associated with the best. You never hear fans yelling, 'We're number 2, we&...
With the threat of higher interest rates, which could potentially slow the economy, it might be a good time to think about international div...