10/14/2012

16 Very Cheap Dividend Challengers With A Single P/E Ratio

Dividend Challengers With Very Low P/E Ratios Researched By “long-term-investments.blogspot.com”. Dividend Challengers are dividend growth stocks from the third category. They raised dividends over a period of more than five consecutive years but less than ten years. Behind Dividend Contenders (10-24 years) and Dividend Champions (>25 years) is this investment class the latest stage for dividend growth investments.

In order to find the cheapest Challengers, I screened all 184 companies by a very low P/E ratio of less than ten. Sixteen stocks fulfilled these pricing criteria of which five are high-yields and six are currently recommended to buy.

Here are my favorite stocks:
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Intel Corporation (NASDAQ:INTC) has a market capitalization of $107.47 billion. The company employs 100,800 people, generates revenue of $53,999.00 million and has a net income of $12,942.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $23,409.00 million. The EBITDA margin is 43.35 percent (operating margin 32.12 percent and net profit margin 23.97 percent).

Financial Analysis: The total debt represents 10.31 percent of the company’s assets and the total debt in relation to the equity amounts to 15.97 percent. Due to the financial situation, a return on equity of 27.15 percent was realized. Twelve trailing months earnings per share reached a value of $2.36. Last fiscal year, the company paid $0.78 in form of dividends to shareholders. INTC raised dividends for 9 consecutive years.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.10, P/S ratio 1.99 and P/B ratio 2.34. Dividend Yield: 4.19 percent. The beta ratio is 1.07.


Long-Term Stock History Chart Of Intel Corporation (Click to enlarge)
Long-Term Dividends History of Intel Corporation (INTC) (Click to enlarge)
Long-Term Dividend Yield History of Intel Corporation (NASDAQ: INTC) (Click to enlarge)

Guess? (NYSE:GES) has a market capitalization of $2.12 billion. The company employs 14,300 people, generates revenue of $2,688.05 million and has a net income of $270.65 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $476.52 million. The EBITDA margin is 17.73 percent (operating margin 14.78 percent and net profit margin 10.07 percent).

Financial Analysis: The total debt represents 0.66 percent of the company’s assets and the total debt in relation to the equity amounts to 1.04 percent. Due to the financial situation, a return on equity of 23.62 percent was realized. Twelve trailing months earnings per share reached a value of $2.54. Last fiscal year, the company paid $0.80 in form of dividends to shareholders. GES raised dividends for 6 consecutive years.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.78, P/S ratio 0.79 and P/B ratio 1.90. Dividend Yield: 3.22 percent. The beta ratio is 1.67.


Long-Term Stock History Chart Of Guess? (Click to enlarge)
Long-Term Dividends History of Guess? (GES) (Click to enlarge)
Long-Term Dividend Yield History of Guess? (NYSE: GES) (Click to enlarge)

L-3 Communication (NYSE:LLL) has a market capitalization of $6.98 billion. The company employs 61,000 people, generates revenue of $15,169.00 million and has a net income of $968.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,801.00 million. The EBITDA margin is 11.87 percent (operating margin 10.30 percent and net profit margin 6.38 percent).

Financial Analysis: The total debt represents 26.62 percent of the company’s assets and the total debt in relation to the equity amounts to 62.17 percent. Due to the financial situation, a return on equity of 14.24 percent was realized. Twelve trailing months earnings per share reached a value of $9.05. Last fiscal year, the company paid $1.80 in form of dividends to shareholders. LLL raised dividends for 9 consecutive years.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 8.00, P/S ratio 0.46 and P/B ratio 1.08. Dividend Yield: 2.77 percent. The beta ratio is 0.96.


Long-Term Stock History Chart Of L-3 Communication (Click to enlarge)
Long-Term Dividends History of L-3 Communication (LLL) (Click to enlarge)
Long-Term Dividend Yield History of L-3 Communication (NYSE: LLL) (Click to enlarge)

Cummins (NYSE:CMI) has a market capitalization of $16.66 billion. The company employs 44,000 people, generates revenue of $18,048.00 million and has a net income of $1,946.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,586.00 million. The EBITDA margin is 14.33 percent (operating margin 14.85 percent and net profit margin 10.78 percent).

Financial Analysis: The total debt represents 5.88 percent of the company’s assets and the total debt in relation to the equity amounts to 12.49 percent. Due to the financial situation, a return on equity of 36.37 percent was realized. Twelve trailing months earnings per share reached a value of $10.06. Last fiscal year, the company paid $1.32 in form of dividends to shareholders. INTC raised dividends for 7 consecutive years.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 8.70, P/S ratio 0.92 and P/B ratio 3.06. Dividend Yield: 2.29 percent. The beta ratio is 2.01.


Long-Term Stock History Chart Of Cummins (Click to enlarge)
Long-Term Dividends History of Cummins (CMI) (Click to enlarge)
Long-Term Dividend Yield History of Cummins (NYSE: CMI) (Click to enlarge)


Take a closer look at the full table of Dividend Challengers with very cheap price ratios. The average price to earnings ratio (P/E ratio) amounts to 8.44 and forward P/E ratio is 9.12. The dividend yield has a value of 4.30 percent. Price to book ratio is 2.21 and price to sales ratio 1.50. The operating margin amounts to 22.92 percent and the beta ratio is 1.04. The average stock has a debt to equity ratio of 1.09.

Here is the full table with some fundamentals (TTM):

Very Cheap Dividend Challengers (Click to enlarge)

Related stock ticker symbols:
DX, VNR, AZN, STRA, TGH, SWY, INTC, RTN, GES, NOC, LLL, CMI, AIZ, AFG, AFSI, VSEC

Selected Articles:

I am long RTN, AZN. I receive no compensation to write about these specific stocks, sector or theme. I don't plan to increase or decrease positions or obligations within the next 72 hours.

For the other stocks: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I receive no compensation to write about any specific stock, sector or theme.

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