The Safest Dividend Champions with Acceptable P/E Ratios

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Jul 05, 2012
Cheap And Safe Dividend Champions Researched by Dividend Yield - Stock, Capital, Investment. Dividend Champions are stocks with consecutive dividend hikes of more than 25 years. At the moment are 103 companies available which have fulfilled these dividend growth criteria. At times of ongoing crises (debt burdens in industrialized economies), we should consider stocks with reliable dividends and stable business models at reasonable prices. Let’s make a screen.


I screened all Dividend Champions by the safest stocks (beta ratio below 0.5). Those companies have a volatility which is half as strong the market. In order to get attractively valuated stocks, the P/E ratio should be below 20. Exactly 17 Dividend Champions fulfilled these criteria of which 9 have a dividend yield of more than three percent, and 8 are currently recommended to buy.


Here are my favorite stocks:


Kimberly Clark (KMB, Financial) has a market capitalization of $32.94 billion. The company employs 57,000 people, generates revenue of $20,846.00 million and has a net income of $1,523.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3,533.00 million. The EBITDA margin is 16.95 percent (operating margin 11.71 percent and net profit margin 7.31 percent).


Financial Analysis: The total debt represents 34.48 percent of the company’s assets and the total debt in relation to the equity amounts to 127.24 percent. Due to the financial situation, a return on equity of 28.50 percent was realized. Twelve trailing months earnings per share reached a value of $4.31. Last fiscal year, the company paid $2.80 in form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 19.49, P/S ratio 1.58 and P/B ratio 6.33. Dividend Yield: 3.52 percent. The beta ratio is 0.31.


McDonald's (MCD, Financial) has a market capitalization of $90.02 billion. The company employs 420,000 people, generates revenue of $27,006.00 million and has a net income of $5,503.10 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $9,766.70 million. The EBITDA margin is 36.16 percent (operating margin 31.58 percent and net profit margin 20.38 percent).


Financial Analysis: The total debt represents 37.89 percent of the company’s assets and the total debt in relation to the equity amounts to 86.87 percent. Due to the financial situation, a return on equity of 37.92 percent was realized. Twelve trailing months earnings per share reached a value of $5.35. Last fiscal year, the company paid $2.53 in form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.55, P/S ratio 3.33 and P/B ratio 6.29. Dividend Yield: 3.16 percent. The beta ratio is 0.43.


Archer Daniels Midland (ADM, Financial) has a market capitalization of $19.09 billion. The company employs 30,000 people, generates revenue of $80,676.00 million and has a net income of $2,018.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3,651.00 million. The EBITDA margin is 4.53 percent (operating margin 3.74 percent and net profit margin 2.50 percent).


Financial Analysis: The total debt represents 24.46 percent of the company’s assets and the total debt in relation to the equity amounts to 54.86 percent. Due to the financial situation, a return on equity of 12.19 percent was realized. Twelve trailing months earnings per share reached a value of $1.99. Last fiscal year, the company paid $0.62 in form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 14.58, P/S ratio 0.24 and P/B ratio 1.04. Dividend Yield: 2.41 percent. The beta ratio is 0.45.


Hormel Foods (HRL) has a market capitalization of $8.05 billion. The company employs 19,500 people, generates revenue of $7,895.09 million and has a net income of $479.20 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $849.17 million. The EBITDA margin is 10.76 percent (operating margin 9.40 percent and net profit margin 6.07 percent).


Financial Analysis: The total debt represents 5.89 percent of the company’s assets and the total debt in relation to the equity amounts to 9.41 percent. Due to the financial situation, a return on equity of 18.75 percent was realized. Twelve trailing months earnings per share reached a value of $1.75. Last fiscal year, the company paid $0.51 in form of dividends to shareholders.


Market Valuation: Here are the price ratios of the company: The P/E ratio is 17.50, P/S ratio 1.02 and P/B ratio 3.04. Dividend Yield: 1.96 percent. The beta ratio is 0.43.


Take a closer look at the full table of the safest Dividend Champions with acceptable price ratios. The average price to earnings ratio (P/E ratio) amounts to 17.00 and forward P/E ratio is 15.14. The dividend yield has a value of 2.88 percent. Price to book ratio is 3.01 and price to sales ratio 1.49. The operating margin amounts to 15.09 percent and the beta ratio is 0.37.


Related stock ticker symbols:

VVC, ED, PG, UGI, KMB, CLX, MGEE, MCD, PEP, AWR, ADM, WMT, CB, LANC, HRL, RLI, FDO


Selected Articles:

· The 20 Best Yielding Dividend Champions

· 13 Cheap Dividend Champions By Growth

· High Yielding Dividend Champions List

· 12 Dividend Champions With Lowest Debt