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6 Top Long-Term Dividend Growth Stocks With A 20% Return On Investment

The markets hit new highs and valuations grow steadily. I notice that the fight for real and high quality assets is very hard. Today, investors pay 30 times for a solid and slow growing free cash flow. That's crazy in my view because you cannot make a good return with such a high price; it's a 3.3 percent initial yield.

Bonds yielding much lower at a yield of 2.5 for US Bonds to 1.5 percent or less for the German Government Paper. That's a damn low ratio.

But investors like you and me need a good yield to head off market fluctuations and to compensate inflation pressure, but most of the high-quality dividend growth stocks yielding below 3 percent.

My goal for today is to present you those stocks that pay more than the expected inflation rate and have a return on investment ratio above 20 percent. In addition, they should grow at a pace of 5 percent or more over the next five years. 

Below are those 6 results that have matched the above mentioned criteria and hiked dividends for 10 years or more. The results are very limited but can give you a good idea about the current market situation.

6 top long-term dividend growth stocks...

Altria Group (NYSE:MO) has a market capitalization of $80.81 billion. The company employs 9,000 people, generates revenue of $24.466 billion and has a net income of $4.535 billion. Altria Group’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $8.329 billion. The EBITDA margin is 34.04 percent (the operating margin is 28.61 percent and the net profit margin 18.54 percent).

Financial Analysis: The total debt represents 41.64 percent of Altria Group’s assets and the total debt in relation to the equity amounts to 352.44 percent. Due to the financial situation, a return on equity of 124.14 percent was realized by Altria Group. Twelve trailing months earnings per share reached a value of $2.16. Last fiscal year, Altria Group paid $1.80 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 18.82, the P/S ratio is 3.30 and the P/B ratio is finally 19.69. The dividend yield amounts to 4.72 percent and the beta ratio has a value of 0.51.

Long-Term Stock Price Chart Of Altria Group (MO)
Long-Term Dividend Payment History of Altria Group (MO)
Long-Term Dividend Yield History of Altria Group (MO)

Reynolds American (NYSE:RAI) has a market capitalization of $31.33 billion. The company employs 5,200 people, generates revenue of $8.236 billion and has a net income of $1.718 billion. Reynolds American’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3.267 billion. The EBITDA margin is 39.67 percent (the operating margin is 38.03 percent and the net profit margin 20.86 percent).

Financial Analysis: The total debt represents 33.11 percent of Reynolds American’s assets and the total debt in relation to the equity amounts to 98.68 percent. Due to the financial situation, a return on equity of 32.96 percent was realized by Reynolds American. Twelve trailing months earnings per share reached a value of $2.83. Last fiscal year, Reynolds American paid $2.48 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 20.66, the P/S ratio is 3.81 and the P/B ratio is finally 6.09. The dividend yield amounts to 4.58 percent and the beta ratio has a value of 0.48.

Long-Term Stock Price Chart Of Reynolds American (RAI)
Long-Term Dividend Payment History of Reynolds American (RAI)
Long-Term Dividend Yield History of Reynolds American (RAI)

Clorox (NYSE:CLX) has a market capitalization of $11.36 billion. The company employs 8,400 people, generates revenue of $5.623 billion and has a net income of $574.00 million. Clorox’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.149 billion. The EBITDA margin is 20.43 percent (the operating margin is 15.17 percent and the net profit margin 10.21 percent).

Financial Analysis: The total debt represents 55.02 percent of Clorox’s assets and the total debt in relation to the equity amounts to 1,624.66 percent. Due to the financial situation, a return on equity of 10,436.36 percent was realized by Clorox. Twelve trailing months earnings per share reached a value of $4.34. Last fiscal year, Clorox paid $2.56 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 20.34, the P/S ratio is 2.01 and the P/B ratio is finally 78.63. The dividend yield amounts to 3.36 percent and the beta ratio has a value of 0.46.

Long-Term Stock Price Chart Of Clorox (CLX)
Long-Term Dividend Payment History of Clorox (CLX)
Long-Term Dividend Yield History of Clorox (CLX)

Lockheed Martin (NYSE:LMT) has a market capitalization of $51.93 billion. The company employs 115,000 people, generates revenue of $45.358 billion and has a net income of $2.950 billion. Lockheed Martin’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6.212 billion. The EBITDA margin is 13.70 percent (the operating margin is 9.93 percent and the net profit margin 6.50 percent).

Financial Analysis: The total debt represents 17.00 percent of Lockheed Martin’s assets and the total debt in relation to the equity amounts to 125.09 percent. Due to the financial situation, a return on equity of 119.02 percent was realized by Lockheed Martin. Twelve trailing months earnings per share reached a value of $9.57. Last fiscal year, Lockheed Martin paid $4.78 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.99, the P/S ratio is 1.14 and the P/B ratio is finally 10.50. The dividend yield amounts to 3.29 percent and the beta ratio has a value of 0.66.

Long-Term Stock Price Chart Of Lockheed Martin (LMT)
Long-Term Dividend Payment History of Lockheed Martin (LMT)
Long-Term Dividend Yield History of Lockheed Martin (LMT)

McDonald's (NYSE:MCD) has a market capitalization of $100.82 billion. The company employs 440,000 people, generates revenue of $28.105 billion and has a net income of $5.585 billion. McDonald's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $10.080 billion. The EBITDA margin is 35.87 percent (the operating margin is 31.18 percent and the net profit margin 19.87 percent).

Financial Analysis: The total debt represents 38.58 percent of McDonald's assets and the total debt in relation to the equity amounts to 88.26 percent. Due to the financial situation, a return on equity of 35.69 percent was realized by McDonald's. Twelve trailing months earnings per share reached a value of $5.51. Last fiscal year, McDonald's paid $3.12 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 18.52, the P/S ratio is 3.60 and the P/B ratio is finally 6.34. The dividend yield amounts to 3.16 percent and the beta ratio has a value of 0.30.

Long-Term Stock Price Chart Of McDonald's (MCD)
Long-Term Dividend Payment History of McDonald's (MCD)
Long-Term Dividend Yield History of McDonald's (MCD)

Kimberly Clark (NYSE:KMB) has a market capitalization of $41.72 billion. The company employs 57,000 people, generates revenue of $21.152 billion and has a net income of $2.016 billion. Kimberly Clark’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $4.071 billion. The EBITDA margin is 19.25 percent (the operating margin is 15.17 percent and the net profit margin 9.53 percent).

Financial Analysis: The total debt represents 33.51 percent of Kimberly Clark’s assets and the total debt in relation to the equity amounts to 130.54 percent. Due to the financial situation, a return on equity of 43.53 percent was realized by Kimberly Clark. Twelve trailing months earnings per share reached a value of $5.58. Last fiscal year, Kimberly Clark paid $3.24 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 19.85, the P/S ratio is 1.96 and the P/B ratio is finally 8.64. The dividend yield amounts to 3.05 percent and the beta ratio has a value of 0.24.

Long-Term Stock Price Chart Of Kimberly Clark (KMB)
Long-Term Dividend Payment History of Kimberly Clark (KMB)
Long-Term Dividend Yield History of Kimberly Clark (KMB)
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*I am long MCD, LMT, MO, KMB. I receive no compensation to write about these specific stocks, sector or theme. I don't plan to increase or decrease positions or obligations within the next 72 hours.

For the other stocks: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I receive no compensation to write about any specific stock, sector or theme.