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12 Cheapest Dividend Achievers By PEG Ratio

Each investor try's to figure out if a stock is cheap or not. Fundamentally, there are two basic methods to identify a cheap company by price ratios: PER and PEG.

PER


The P/E ratio is simply to calculate: Just divide Price with Earnings. Essentially, this tells you how much an investor is willing to pay for each unit (year) of earnings. 


If a stock is trading at a P/E ratio of 30, it is said to be trading at 30x times its annual earnings. In general, the lower the P/E ratio the better. 


A common threshold for many investors is a P/E of 20 or less. (For the record, at the time of this writing, the S&P 500 Index was trading at a P/E (using F1 Estimates) of 15.33.) 


PEG


A PEG ratio is the: P/E Ratio divided by the Growth Rate Conventional wisdom says a value of 1 or less is considered good (at par or undervalued to its growth rate), while a value of greater than 1, in general, is not as good (overvalued to its growth rate). 


Many believe the PEG ratio tells a more complete story than just the P/E ratio. (The S&P at the time of this writing had a PEG ratio of 1.93.) 


 Let's take a look at both of these in action. For example: a company with a P/E Ratio of 25 and a Growth Rate of 20% would have a PEG ratio of 1.25 (25 / 20= 1.25). 


While a company with a P/E Ratio of 40 and a Growth Rate of 50% would have a PEG Ratio of 0.80 (40 / 50= 0.80). 


Traditionally, investors would look at the stock with the lower P/E ratio and deem it a bargain (undervalued). 


But looking at it closer, you can see it doesn't have the growth rate to justify its P/E. The stock with the P/E of 40, however, is actually the better bargain since its PEG ratio is lower (0.80) and is trading at a discount to its growth rate. In other words, the lower the PEG ratio, the better the value. That's because the investor would be paying less for each unit of earnings growth.


Attached you will find a sheet of Dividend Achievers with the lowest PEG Ratio on the market. Those stocks have risen dividends over more than 10 consecutive years and a PEG ratio of less than one.


Twelve companies fulfill these criteria of which three pay dividends over three percent.


Here are the top yielding results....



Alliance Holdings -- Yield: 12.80%

Alliance Holdings (NASDAQ:AHGP) employs 4,439 people, generates revenue of $2,300.32 million and has a net income of $492.67 million. The current market capitalization stands at $1.80 billion.

Alliance Holdings’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $814.23 million. The EBITDA margin is 35.40% (the operating margin is 23.46% and the net profit margin 21.42%).

Financials: The total debt represents 36.62% of Alliance Holdings assets and the total debt in relation to the equity amounts to 148.41%. Due to the financial situation, a return on equity of 53.62% was realized by Alliance Holdings.

Twelve trailing months earnings per share reached a value of $4.44. Last fiscal year, Alliance Holdings paid $3.44 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 7.00, the P/S ratio is 0.78 and the P/B ratio is finally 3.18. The dividend yield amounts to 12.80%.

Stock Charts:


Long-Term Stock Price Chart of Alliance Holdings (AHGP)
Long-Term Stock Price Chart of Alliance Holdings (AHGP)
Long-Term Dividend Payment History of Alliance Holdings (AHGP)
Long-Term Dividend Payment History of Alliance Holdings (AHGP)
Long-Term Dividend Yield History of Alliance Holdings (AHGP)
Long-Term Dividend Yield History of Alliance Holdings (AHGP)


Caterpillar -- Yield: 4.79%

Caterpillar (NYSE:CAT) employs 114,233 people, generates revenue of $55,184.00 million and has a net income of $3,703.00 million. The current market capitalization stands at $38.75 billion.

Caterpillar’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $8,932.00 million. The EBITDA margin is 16.19% (the operating margin is 9.65% and the net profit margin 6.71%).

Financials: The total debt represents 46.39% of Caterpillar assets and the total debt in relation to the equity amounts to 234.59%. Due to the financial situation, a return on equity of 19.68% was realized by Caterpillar.

Twelve trailing months earnings per share reached a value of $5.83. Last fiscal year, Caterpillar paid $2.70 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.03, the P/S ratio is 0.70 and the P/B ratio is finally 2.33. The dividend yield amounts to 4.79%.

Stock Charts:


Long-Term Stock Price Chart of Caterpillar (CAT)
Long-Term Stock Price Chart of Caterpillar (CAT)
Long-Term Dividend Payment History of Caterpillar (CAT)
Long-Term Dividend Payment History of Caterpillar (CAT)
Long-Term Dividend Yield History of Caterpillar (CAT)
Long-Term Dividend Yield History of Caterpillar (CAT)


Compass Minerals -- Yield: 3.41%

Compass Minerals (NYSE:CMP) employs 1,963 people, generates revenue of $1,282.50 million and has a net income of $217.90 million. The current market capitalization stands at $2.61 billion.

Compass Minerals’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $305.70 million. The EBITDA margin is 23.84% (the operating margin is 24.25% and the net profit margin 16.99%).

Financials: The total debt represents 38.26% of Compass Minerals assets and the total debt in relation to the equity amounts to 95.84%. Due to the financial situation, a return on equity of 35.83% was realized by Compass Minerals.

Twelve trailing months earnings per share reached a value of $7.17. Last fiscal year, Compass Minerals paid $2.40 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 10.99, the P/S ratio is 2.04 and the P/B ratio is finally 3.98. The dividend yield amounts to 3.41%.

Stock Charts:


Long-Term Stock Price Chart of Compass Minerals (CMP)
Long-Term Stock Price Chart of Compass Minerals (CMP)
Long-Term Dividend Payment History of Compass Minerals (CMP)
Long-Term Dividend Payment History of Compass Minerals (CMP)
Long-Term Dividend Yield History of Compass Minerals (CMP)
Long-Term Dividend Yield History of Compass Minerals (CMP)


SJW -- Yield: 2.57%

SJW (NYSE:SJW) employs 395 people, generates revenue of $319.67 million and has a net income of $51.81 million. The current market capitalization stands at $618.85 million.

SJW’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $132.37 million. The EBITDA margin is 41.41% (the operating margin is 29.05% and the net profit margin 16.21%).

Financials: The total debt represents 31.37% of SJW assets and the total debt in relation to the equity amounts to 110.55%. Due to the financial situation, a return on equity of 15.21% was realized by SJW.

Twelve trailing months earnings per share reached a value of $2.75. Last fiscal year, SJW paid $0.75 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.37, the P/S ratio is 1.94 and the P/B ratio is finally 1.71. The dividend yield amounts to 2.57%.

Stock Charts:


Long-Term Stock Price Chart of SJW (SJW)
Long-Term Stock Price Chart of SJW (SJW)
Long-Term Dividend Payment History of SJW (SJW)
Long-Term Dividend Payment History of SJW (SJW)
Long-Term Dividend Yield History of SJW (SJW)
Long-Term Dividend Yield History of SJW (SJW)


Ameriprise Financial -- Yield: 2.52%

Ameriprise Financial (NYSE:AMP) employs 12,209 people, generates revenue of $12,296.00 million and has a net income of $2,002.00 million. The current market capitalization stands at $18.97 billion.

Ameriprise Financial’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3,190.00 million. The EBITDA margin is 25.94% (the operating margin is 23.38% and the net profit margin 16.28%).

Financials: The total debt represents 11.95% of Ameriprise Financial assets and the total debt in relation to the equity amounts to 218.94%. Due to the financial situation, a return on equity of 19.87% was realized by Ameriprise Financial.

Twelve trailing months earnings per share reached a value of $8.71. Last fiscal year, Ameriprise Financial paid $2.26 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 12.59, the P/S ratio is 1.54 and the P/B ratio is finally 2.40. The dividend yield amounts to 2.52%.

Stock Charts:


Long-Term Stock Price Chart of Ameriprise Financial (AMP)
Long-Term Stock Price Chart of Ameriprise Financial (AMP)
Long-Term Dividend Payment History of Ameriprise Financial (AMP)
Long-Term Dividend Payment History of Ameriprise Financial (AMP)
Long-Term Dividend Yield History of Ameriprise Financial (AMP)
Long-Term Dividend Yield History of Ameriprise Financial (AMP)


AmTrust Financial -- Yield: 1.95%

AmTrust Financial (NASDAQ:AFSI) employs 5,100 people, generates revenue of $4,092.37 million and has a net income of $418.25 million. The current market capitalization stands at $5.10 billion.

AmTrust Financial’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $979.58 million. The EBITDA margin is 23.94% (the operating margin is 10.88% and the net profit margin 10.22%).

Financials: The total debt represents 6.69% of AmTrust Financial assets and the total debt in relation to the equity amounts to 45.45%. Due to the financial situation, a return on equity of 28.28% was realized by AmTrust Financial.

Twelve trailing months earnings per share reached a value of $5.54. Last fiscal year, AmTrust Financial paid $0.85 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 11.07, the P/S ratio is 1.25 and the P/B ratio is finally 2.76. The dividend yield amounts to 1.95%.

Stock Charts:


Long-Term Stock Price Chart of AmTrust Financial (AFSI)
Long-Term Stock Price Chart of AmTrust Financial (AFSI)
Long-Term Dividend Payment History of AmTrust Financial (AFSI)
Long-Term Dividend Payment History of AmTrust Financial (AFSI)
Long-Term Dividend Yield History of AmTrust Financial (AFSI)
Long-Term Dividend Yield History of AmTrust Financial (AFSI)


Polaris Industries -- Yield: 1.79%

Polaris Industries (NYSE:PII) employs 7,000 people, generates revenue of $4,479.65 million and has a net income of $454.03 million. The current market capitalization stands at $7.85 billion.

Polaris Industries’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $780.53 million. The EBITDA margin is 17.42% (the operating margin is 15.95% and the net profit margin 10.14%).

Financials: The total debt represents 10.90% of Polaris Industries assets and the total debt in relation to the equity amounts to 26.26%. Due to the financial situation, a return on equity of 65.01% was realized by Polaris Industries.

Twelve trailing months earnings per share reached a value of $6.82. Last fiscal year, Polaris Industries paid $1.92 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 17.32, the P/S ratio is 1.75 and the P/B ratio is finally 9.14. The dividend yield amounts to 1.79%.

Stock Charts:


Long-Term Stock Price Chart of Polaris Industries (PII)
Long-Term Stock Price Chart of Polaris Industries (PII)
Long-Term Dividend Payment History of Polaris Industries (PII)
Long-Term Dividend Payment History of Polaris Industries (PII)
Long-Term Dividend Yield History of Polaris Industries (PII)
Long-Term Dividend Yield History of Polaris Industries (PII)


12 Cheapest Dividend Achievers By PEG Ratio (click to enlarge)

2 comments:

  1. Thanks for sharing this list of stocks. I have my eye on CAT this month with EMR as my top two picks for October. There's little doubt that they both are sporting better value and yield as a result of their recent stock price decline.

    ReplyDelete
    Replies
    1. Thanks for your comment. I like both companies too. They are more cyclic and depended on the commodity sector who finds its bottom. It could be a great opportunity but CAT is more risky due to a higher debt.

      Delete

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