The Best Dogs Of The Dow Jones As Of November 2012

By
A A A

Submitted by Dividend Yield as part of our contributors program .

Many people ask themselves how to make money with stocks and generate a second income that is high enough to retiree a few years earlier in order to enjoy the lifetime a bit more. Most investors try to search a safe investment strategy that works really well. A Strategy, simple enough to understand and easy to implement. Some investment strategies fail, others work well but every tactic is not forever. It comes the time when the market forces change.

One strategy I cover in my blog on a regular basis is the Dogs of the Dow Jones philosophy. The strategy is to buy 10 stocks of the Dow Jones with the highest dividend yield and lowest price to earnings ratio at the beginning of the year and to hold these stocks for a year. After this period, the investor should sell stocks that are no more Dogs of the Dow and buy therefore new Dogs of the Dow. Below is an updated sheet of the 10 best Dogs of the Dow. Such stocks have the lowest expected price to earnings ratio and highest dividend yield within the Dow Jones Index.

Here are the three best Dogs with strongest EPS growth:

1. Verizon ( VZ ) has a market capitalization of $123.57 billion. The company employs 184,500 people, generates revenue of $110.875 billion and has a net income of $10.198 billion. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $29.376 billion. The EBITDA margin is 26.49 percent (the operating margin is 11.62 percent and the net profit margin 9.20 percent).

Financial Analysis: The total debt represents 23.93 percent of the company's assets and the total debt in relation to the equity amounts to 153.33 percent. Due to the financial situation, a return on equity of 6.45 percent was realized. Twelve trailing months earnings per share reached a value of $1.07. Last fiscal year, the company paid $1.98 in the form of dividends to shareholders. The earnings are expected to grow by 16.26 percent for the next year.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 40.37, the P/S ratio is 1.13 and the P/B ratio is finally 3.45. The dividend yield amounts to 4.71 percent and the beta ratio has a value of 0.51.

2. E I Du Pont De Nemours ( DD ) has a market capitalization of $40.42 billion. The company employs 70,000 people, generates revenue of $38.719 billion and has a net income of $3.510 billion. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6.289 billion. The EBITDA margin is 16.24 percent (the operating margin is 11.06 percent and the net profit margin 9.07 percent).

Financial Analysis: The total debt represents 25.89 percent of the company's assets and the total debt in relation to the equity amounts to 146.08 percent. Due to the financial situation, a return on equity of 39.82 percent was realized. Twelve trailing months earnings per share reached a value of $2.98. Last fiscal year, the company paid $1.64 in the form of dividends to shareholders. The earnings are expected to grow by 12.73 percent for the next year.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 14.54, the P/S ratio is 1.04 and the P/B ratio is finally 4.78. The dividend yield amounts to 3.99 percent and the beta ratio has a value of 1.47.

3. General Electric ( GE ) has a market capitalization of $220.84 billion. The company employs 301,000 people, generates revenue of $147.300 billion and has a net income of $14.366 billion. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $31.015 billion. The EBITDA margin is 21.06 percent (the operating margin is 13.64 percent and the net profit margin 9.75 percent).

Financial Analysis: The total debt represents 63.22 percent of the company's assets and the total debt in relation to the equity amounts to 389.43 percent. Due to the financial situation, a return on equity of 11.06 percent was realized. Twelve trailing months earnings per share reached a value of $1.35. Last fiscal year, the company paid $0.61 in the form of dividends to shareholders. The earnings are expected to grow by 12.58 percent for the next year.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 15.63, the P/S ratio is 1.50 and the P/B ratio is finally 1.91. The dividend yield amounts to 3.23 percent and the beta ratio has a value of 1.62.

Take a closer look at the full list of the 10 cheapest stocks of the Dow Jones. They have an average dividend yield of 21.72 percent as well as a forward P/E ratio of 12.02. The average P/B ratio amounts to 2.37 and P/S ratio is 1.97.

Selected Articles:
· The Best Trading Ideas | 19 Dividend Stocks at All-Time-Highs
· Warren Buffett | Berkshire Hathaway Q3/2012 Fund Portfolio
· A Quick Overview Of The Highest Yielding Stocks From The S&P 500
· The Fastest Growing Dividend Stocks In The Dow Jones Index



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks , US Markets

Referenced Stocks: DD , GE , VZ

Trefis

Trefis

More from Trefis:

Related Videos

Voya – Babies Retirement
Voya – Babies Retirement            

Stocks

Referenced

55%
89%
72%

Most Active by Volume

28,637,732
  • $8.4499 ▲ 6.56%
23,552,396
  • $104.985 ▲ 1.94%
21,821,362
  • $16.70 ▲ 1.83%
20,623,795
  • $33.60 ▼ 2.61%
13,656,866
  • $12.59 ▼ 1.87%
13,629,598
  • $97.94 ▲ 1.63%
11,598,482
  • $80.0801 ▲ 2.18%
10,655,559
  • $59.16 ▼ 15.76%
As of 10/23/2014, 10:56 AM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com