10 Stocks With Very High Yields And Expected Earnings Growth

by Dividend Yield
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Submitted by Dividend Yield as part of our contributors program.

Stocks with over 10% dividend yield and positive earnings growth originally published at “long-term-investments.blogspot.com“. Some people believe that a very high yield should help them to boost their dividend income. This may be right for the short-run but a high yield does not guarantee that you will receive the same dividend every year over a long time. Not enough, if your dividend income is not growing you will get poorer because inflation makes the prices of other goods more expensive and your purchasing power sinks.

What you need is a rising dividend income to fight the inflation. Today, I like to screen the market by the highest yielding stocks with growing earnings, expected for the next five years. Sure, these are very rough screening criteria but it’s a first step to get new ideas.

42 stocks matched the mentioned criteria but some of the results have a very low market capitalization. In order to eliminate those risks, I selected only companies with a market capitalization of more than USD 2 billion. Finally, 10 stocks remain of which six have a buy or better recommendation.

Here are my favorite stocks:

American Capital Agency (AGNC) has a market capitalization of $11.02 billion. The company generates revenue of $2.109 billion and has a net income of $1.277 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.453 billion. The EBITDA margin is 68.90 percent (the operating margin is 61.45 percent and the net profit margin 60.55 percent).

Financial Analysis: The total debt represents 76.33 percent of the company’s assets and the total debt in relation to the equity amounts to 703.80 percent. Due to the financial situation, a return on equity of 14.96 percent was realized. Twelve trailing months earnings per share reached a value of $4.41. Last fiscal year, the company paid $5.00 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 7.38, the P/S ratio is 5.27 and the P/B ratio is finally 1.03. The dividend yield amounts to 15.38 percent and the beta ratio has a value of 0.43.

Penn West Petroleum (PWE) has a market capitalization of $4.88 billion. The company employs 2,170 people, generates revenue of $2.826 billion and has a net income of $172.93 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.922 billion. The EBITDA margin is 68.00 percent (the operating margin is 8.33 percent and the net profit margin 6.12 percent).

Financial Analysis: The total debt represents 18.56 percent of the company’s assets and the total debt in relation to the equity amounts to 30.31 percent. Due to the financial situation, a return on equity of 1.94 percent was realized. Twelve trailing months earnings per share reached a value of $0.37. Last fiscal year, the company paid $1.07 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 27.63, the P/S ratio is 1.73 and the P/B ratio is finally 0.55. The dividend yield amounts to 10.65 percent and the beta ratio has a value of 1.44.

Take a closer look at the full list of stocks with very high yields and growth. The average P/E ratio amounts to 14.32 and forward P/E ratio is 8.06. The dividend yield has a value of 15.78 percent. Price to book ratio is 1.17 and price to sales ratio 4.06. The operating margin amounts to 4.15 percent and the beta ratio is 1.06. Stocks from the list have an average debt to equity ratio of 3.09.

 

Selected Articles:
· 17 Higher Capitalized Stocks With Really Huge Dividend Yields (Over 10%)
· 13 Of The Best Dividend Paying High Yields
· The Best Dividend Paying Stocks From The S&P 500
· Cheapest Large Caps With Highest Expected Growth As Of August 2012

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