Back to main

9 Dividend Stocks Predictive Analysts Expect to Outperform

Posted
10/31/2011 9:11:00 PM
By: Kapitall
Referenced Stocks:BBT;CBS;CCL;EMN;KLAC;KNX;KSS;MT;PPG

(Written by Alexander Crawford. Analyst ratings sourced from Reuters, price data sourced from Yahoo! Finance, dividend data sourced from Finviz.)

Analyst ratings are a great guide to what the market is thinking about a company’s outlook, but finding groups of analysts that have a history of predicting stock performance is even better.

When those analysts become more optimistic about a company, it’s a signal to take a second look.

Using analyst ratings from Reuters that are presented on a linear scale (with 1 = “Strong Buy” and 5 = “Strong Sell”), we sliced the ratings data of stocks paying dividend yields above 1% and sustainable payout ratios below 50% into three monthly time periods, and identified the groups of analysts that have shown predictive value over two consecutive time periods.

We further narrowed down the list by only focusing on those stocks that have seen bullish trends in recent analyst opinion.

Although past performance is no guarantee of future results, the recent accuracy of these analyst ratings suggests their opinions may be a helpful starting-off point for your own analysis.

Do you think these analysts will continue to accurately predict these stocks’ movements?

Use this list as a starting-off point for your own analysis.

Analyze These Ideas (Tools Will Open In A New Window)

1. Access a thorough description of all companies mentioned
2. Compare analyst ratings for all stocks mentioned below
3. Visualize annual returns for all stocks mentioned

List sorted by dividend yield.

1. Arcelor Mittal (MT): Engages in the production and marketing of steel worldwide. Market cap of $28.67B. Dividend yield at 4.08%, payout ratio at 35.83%. Mean average rating changed from 2.14 to 2.15 between 07/20/11 and 08/19/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -17.14%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.15 to 2.08 (bullish change). Over the following month, the stock generated an alpha of 7.15% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.08 to 2 between 09/18/11 and 10/18/11 (i.e. bullish change).

2. KLA-Tencor Corporation (KLAC): Engages in the design, manufacture, and marketing of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Market cap of $7.20B. Dividend yield at 3.24%, payout ratio at 21.07%. Mean average rating changed from 2.39 to 2.17 between 07/20/11 and 08/19/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 7.98%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.17 to 2.16 (bullish change). Over the following month, the stock generated an alpha of 11.08% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.16 to 2.14 between 09/18/11 and 10/18/11 (i.e. bullish change)

3. Carnival Corporation (CCL): Operates as a cruise and vacation company. Market cap of $26.22B. Dividend yield at 2.96%, payout ratio at 34.51%. Mean average rating changed from 1.8 to 1.76 between 07/20/11 and 08/19/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 2.08%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 1.76 to 1.72 (bullish change). Over the following month, the stock generated an alpha of 4.46% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 1.72 to 1.7 between 09/18/11 and 10/18/11 (i.e. bullish change)

4. PPG Industries Inc. (PPG): Manufactures and supplies protective and decorative coatings. Market cap of $12.42B. Dividend yield at 2.89%, payout ratio at 34.59%. Mean average rating changed from 2.73 to 2.55 between 07/20/11 and 08/19/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 5.66%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.55 to 2.46 (bullish change). Over the following month, the stock generated an alpha of 2.1% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.46 to 2.44 between 09/18/11 and 10/18/11 (i.e. bullish change)

5. Eastman Chemical Co. (EMN): Engages in the manufacture and sale of chemicals, plastics, and fibers in the United States and internationally. Market cap of $5.07B. Dividend yield at 2.88%, payout ratio at 23.12%. Mean average rating changed from 1.9 to 2.09 between 07/20/11 and 08/19/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -8.25%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.09 to 2.27 (bearish change). Over the following month, the stock generated an alpha of -1.02% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.27 to 2.08 between 09/18/11 and 10/18/11 (i.e. bullish change)

6. BB & T Corp. (BBT): Operates as the financial holding company for Branch Banking and Trust Company that provides banking and trust services to small and mid-size businesses, public agencies, local governments, and individuals in the United States. Market cap of $15.54B. Dividend yield at 2.87%, payout ratio at 45.68%. Mean average rating changed from 2.72 to 2.71 between 07/20/11 and 08/19/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 6.37%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.71 to 2.61 (bullish change). Over the following month, the stock generated an alpha of 2.89% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.61 to 2.58 between 09/18/11 and 10/18/11 (i.e. bullish change)

7. Kohl's Corp. (KSS): Operates department stores in the United States. Market cap of $14.02B. Dividend yield at 1.92%, payout ratio at 12.06%. Mean average rating changed from 1.57 to 1.67 between 07/20/11 and 08/19/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -2.29%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 1.67 to 1.64 (bullish change). Over the following month, the stock generated an alpha of 8.54% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 1.64 to 1.61 between 09/18/11 and 10/18/11 (i.e. bullish change)

8. CBS Corporation (CBS): Operates as a mass media company in the United States and internationally. Market cap of $15.63B. Dividend yield at 1.71%, payout ratio at 14.07%. Mean average rating changed from 2.11 to 2.04 between 07/20/11 and 08/19/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 3.76%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.04 to 2.07 (bearish change). Over the following month, the stock generated an alpha of -4.39% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.07 to 2 between 09/18/11 and 10/18/11 (i.e. bullish change)

9. Knight Transportation Inc. (KNX): Provides asset-based dry van truckload and temperature controlled carrier services primarily for short and medium haul. Market cap of $1.17B. Dividend yield at 1.65%, payout ratio at 34.84%. Mean average rating changed from 2.5 to 2.54 between 07/20/11 and 08/19/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -2.19%. Analysts also got it right between 08/19/11 and 09/18/11, with the mean rating changing from 2.54 to 2.5 (bullish change). Over the following month, the stock generated an alpha of 0.16% relative to the S&P 500 index, as predicted by the analysts. This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.5 to 2.48 between 09/18/11 and 10/18/11 (i.e. bullish change).