My Favorite Dividend Paying Buyback Hero Stocks

As you might know, I am a big fan of dividend growth and stock buybacks. Each action is a shareholder friendly way to give money back to the owner of the company.

Dividends are direct and share buybacks are indirect and more tax efficient. Both activities only make sense if the management team has a clear view about the valuation and growth perspectives or potential of the corporation. If there is an opportunity to grow with low risk, dividends shouldn't be paid in a big way. The same is neccessary for buybacks. There must be a mix of both in balance with growth.

Today I like to share a sheet of interesting stocks with good outstanding buyback programs. I've focused my research on growth and dividends while the valuation level doesn't exceed critical levels.

Here are my results...

The Best Dividend Ideas From The Buyback Achievers Index

There are a number of ways in which a company can return wealth to its shareholders. 

Although stock price appreciation and dividends are the two most common ways of doing this, there are other useful, and often overlooked, ways for companies to share their wealth with investors: Dividends and share buybacks. 

Buybacks is one way to build values for investors. It's a kind of income usage. Buying back own shares increases future eps when the net income is constant.

Today I would like to introduce a number of stocks with interesting fundamentals and price ratios that have bought own shares in a significant amount back.

Each of the attached stocks have fulfilled all of the following criteria:

- Share reduction over the past year over 5%
- Forward P/E under 15
- Debt-to-equity under 1
- Positive ROA
- EPS growth for the next five years over 5%
- Dividend yield at least 2%

Here are the results...

13 Dividend Stocks With The Highest Profitable Earnings Growth For The Future

Stocks of companies that initiate dividends tend to fare well. Shares of dividend payers raise an average of 15% in the 12 months following the announcement of the initial disbursement. 

Growing companies have better things to do with their money than dole it out as dividends. Reinvesting in the business is usually a better idea, especially if a firm is racking up high returns on invested capital (a measure of profitability). 

But a corporate that doesn’t pay money to shareholders is nothing worth. Only the stock market could reward the rising business structure with hopes to get all of the invested money back.

I'm a big fan of dividends and share buybacks. Better is the cash source of the company. If it generates tons of cash and don't need to put most of the money back into the company, it's one of the best investments if they have a stable business with big competitive advances.

Growth combined with value and predictable business models is one of my key premises when I put money into stocks.

Today I like to highlight those dividend paying stocks with the highest growth expectations for the next five years. Especially cyclic stocks have enormous EPS growth rates when they come out of their business cycle.

I like to exclude those companies by implementing a positive sales growth rule of the past years. In addition, the company should not have unsustainable high debt and a double digit Return on Investment ratio. Only a profitable growth makes sense over the long-term.

13 companies fulfilled these criteria of which four yield over 3 percent. Attached you can find the full list of the results with some fundamentals. I hope you find new inpirations and get a broader view on the market. If you like my articles, you can easily subscribe my free newsletter via RSS.

Here are the top yielding results...