We have run our screen in search for high yield, high dividend growth, low payout undervalued stocks with consistent earnings history and prospects. For those who are not familiar with our screening process and strategy, details are available here. Previous posts on the strategy can also be read here.
This month, and based on end-May data, there will be 9 new additions to the dividend core stock portfolio (each with a 3% weight):
Based on data as of May 31, 2012
| Company | Symbol | Industry | Yield | DGR | Payout |
|---|---|---|---|---|---|
| Air Products & Chem. | APD | Chemical | 3.24% | 10.4% | 48.1% |
| Emerson Electric | EMR | Industrial Equipt | 3.42% | 8.7% | 51.1% |
| Republic Services | RSG | Waste Management | 3.34% | 12.5% | 57.1% |
| General Dynamics | GD | Aerospace/Defense | 3.19% | 9.9% | 29.7% |
| Safeway | SWY | Retail | 3.68% | 9.5% | 39.8% |
| Norfolk Southern | NSC | Railroad | 2.87% | 14.8% | 32.5% |
| Mc Donald’s | MCD | Restaurants | 3.13% | 11.3% | 52.3% |
| Walgreen | WAG | Retail | 2.95% | 12.1% | 30.7% |
| Owen & Minor | OMI | Medical Equipt | 3.09% | 9.5% | 48.3% |
The correction that took place over the last couple of months drove yields higher for a number of solid companies, thus allowing us to enter 9 new positions at interesting yield-on-cost. Overall, our core portfolio is now comprised of 28 stocks for an average yield of 3.45% (more than twice that of the S&P500) and a Price-Earnings-ratio of 9.9 (around 30% below that of the S&P500).
The detailed portfolio composition is available here.
JUN
