5/11/2012

24 Of Warren Buffett’s Most Wanted Dividend Stocks

Investment Targets Of Warren Buffett Researched By Dividend Yield - Stock, Capital, Investment. Warren Buffett is an American investor, Chairman and CEO of Berkshire Hathaway. He is the third richest man in the world in accordance to Forbes and one of the most influential people in the world. The investor generates nearly USD 1 billion in free cash flow per month and has additional USD 37.8 billion in cash for takeover projects. As of Q4/2011, Warren's portfolio had a worth of USD 66.15 billion.

Recently, Bloomberg analyst's made a screen of stocks with some classical Buffett target-criteria:

- Market Capitalization from $20 Billion to $40 Billion
- Capital Expenditures / Net Fixed Assets > 10%
- 5-Year Average Growth in ROIC in Highest 50%
- 5-Year Average Operating Cash Flow Growth in Highest 50%
- P/E Ratio < Average Company Value in Home Market

24 companies worldwide remained of which 14 are U.S. listed. Four of the results have a yield over three percent and twelve are currently recommended to buy.

These are my favorite stocks from the results:
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Deere & Company (NYSE:DE) has a market capitalization of $31.73 billion. The company employs 61,300 people, generates revenues of $32,012.50 million and has a net income of $2,799.20 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5,903.20 million. Because of these figures, the EBITDA margin is 18.44 percent (operating margin 13.19 percent and the net profit margin finally 8.74 percent). 


Financial Analysis: The total debt representing 55.16 percent of the company’s assets and the total debt in relation to the equity amounts to 391.01 percent. Due to the financial situation, a return on equity of 42.76 percent was realized. Twelve trailing months earnings per share reached a value of $6.73. Last fiscal year, the company paid $1.52 in form of dividends to shareholders. 


Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.73, P/S ratio 0.99 and P/B ratio 4.72. Dividend Yield: 2.33 percent. The beta ratio is 1.52.


Long-Term Stock History Chart Of Deere & Company (Click to enlarge)
Long-Term Dividends History of Deere & Company (DE) (Click to enlarge)
Long-Term Dividend Yield History of Deere & Company (NYSE: DE) (Click to enlarge)


Tyco International (NYSE:TYC) has a market capitalization of $25.49 billion. The company employs 100,000 people, generates revenues of $17,355.00 million and has a net income of $1,567.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3,437.00 million. Because of these figures, the EBITDA margin is 19.80 percent (operating margin 12.21 percent and the net profit margin finally 9.03 percent).


Financial Analysis: The total debt representing 15.49 percent of the company’s assets and the total debt in relation to the equity amounts to 29.25 percent. Due to the financial situation, a return on equity of 11.07 percent was realized. Twelve trailing months earnings per share reached a value of $3.02. Last fiscal year, the company paid $0.99 in form of dividends to shareholders. 


Market Valuation: Here are the price ratios of the company: The P/E ratio is 18.23, P/S ratio 1.46 and P/B ratio 1.80. Dividend Yield: 1.82 percent. The beta ratio is 1.13.


Long-Term Stock History Chart Of Tyco International Ltd. (Click to enlarge)
Long-Term Dividends History of Tyco International Ltd. (TYC) (Click to enlarge)
Long-Term Dividend Yield History of Tyco International Ltd. (NYSE: TYC) (Click to enlarge)


McKesson Corporation (NYSE:MCK) has a market capitalization of $21.12 billion. The company employs 37,700 people, generates revenues of $122,734.00 million and has a net income of $1,403.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,474.00 million. Because of these figures, the EBITDA margin is 2.02 percent (operating margin 1.75 percent and the net profit margin finally 1.14 percent). 


Financial Analysis: The total debt representing 12.03 percent of the company’s assets and the total debt in relation to the equity amounts to 58.26 percent. Due to the financial situation, a return on equity of 19.97 percent was realized. Twelve trailing months earnings per share reached a value of $5.60. Last fiscal year, the company paid $0.80 in form of dividends to shareholders. 


Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.03, P/S ratio 0.17 and P/B ratio 3.08. Dividend Yield: 0.89 percent. The beta ratio is 0.80.


Long-Term Stock History Chart Of McKesson Corporation (Click to enlarge)
Long-Term Dividends History of McKesson Corporation (MCK) (Click to enlarge)
Long-Term Dividend Yield History of McKesson Corporation (NYSE: MCK) (Click to enlarge)


Here are the complete targets of the screen:

Apache Corp.
Covidien Plc
Cummins Inc.
Deere & Co.
Deutsche Post AG
Dominion Resources Inc.
Goldcorp Inc.
Henkel AG
ITC Ltd.
Kia Motors Corp.
Kumba Iron Ore Ltd.
McKesson Corp.
Mosaic Co.
Newmont Mining Corp.
NovaTek OAO
OAO GMK Norilsk Nickel
Potash Corp. of Saskatchewan
Prudential Plc
PT Astra International
SAIC Motor Corp.
Sasol Ltd.
Seven & I Holdings Co.
Softbank Corp.
Tyco International Ltd.

Take a closer look at the full table of Warren Buffett's most wanted takeover targets. The average price to earnings ratio (P/E ratio) amounts to 16.18 and forward P/E ratio is 10.55. The dividend yield has a value of 2.11 percent. Price to book ratio is 2.50 and price to sales ratio 2.16. The operating margin amounts to 24.11 percent.

Here is the full table with some fundamentals of the U.S. listed stocks (TTM):

24 Of Warren Buffett’s Most Wanted Dividend Stocks (click to enlarge)


Related stock ticker symbols:
SSL, D, PUK, NEM, DE, ITC, TYC, COV, GG, CMI, POT, MOS, MCK, APA

Selected Articles:

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