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7 Of The Most Underestimated Dividend Stocks

It's hard to define a solid investing criterion which could bring you solid gains while excluding the big risks. 

I personally believe in dividends as a safe haven criteria because cash you have received in the past could compensate a potential loss. 

For sure, this is not a good return driver, especially when we are talking about yields of 1-2 percent yearly, but each penny sums to dollars if you compile enough of them.

Today I run my daily screen about cheap dividend paying stocks with double-digit earnings growth forecasts for the next five years. 

In addition, the stocks have a very comfortable debt situation, measured by a debt-to-equity ratio of less than 0.5.

These are my favorites from the screening results:

QUALCOMM -- Yield: 2.79%

QUALCOMM (NASDAQ:QCOM) employs 31,300 people, generates revenue of $26,487.00 million and has a net income of $7,534.00 million. The current market capitalization stands at $112.09 billion.

QUALCOMM’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $9,008.00 million. The EBITDA margin is 34.01% (the operating margin is 27.84% and the net profit margin 28.44%).

Financials: The total debt represents 0.00% of QUALCOMM assets and the total debt in relation to the equity amounts to 0.00%. Due to the financial situation, a return on equity of 20.03% was realized by QUALCOMM.

Twelve trailing months earnings per share reached a value of $4.22. Last fiscal year, QUALCOMM paid $1.54 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.52, the P/S ratio is 4.23 and the P/B ratio is finally 2.93. The dividend yield amounts to 2.79%.

Stock Charts:

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




Cummins -- Yield: 2.21%

Cummins (NYSE:CMI) employs 54,600 people, generates revenue of $19,221.00 million and has a net income of $1,736.00 million. The current market capitalization stands at $25.61 billion.

Cummins’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,393.00 million. The EBITDA margin is 12.45% (the operating margin is 12.30% and the net profit margin 9.03%).

Financials: The total debt represents 10.76% of Cummins assets and the total debt in relation to the equity amounts to 21.91%. Due to the financial situation, a return on equity of 21.64% was realized by Cummins.

Twelve trailing months earnings per share reached a value of $9.33. Last fiscal year, Cummins paid $2.81 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 15.25, the P/S ratio is 1.33 and the P/B ratio is finally 3.32. The dividend yield amounts to 2.21%.

Stock Charts:

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

NetApp -- Yield: 1.89%

NetApp (NASDAQ:NTAP) employs 12,490 people, generates revenue of $6,325.10 million and has a net income of $637.50 million. The current market capitalization stands at $10.87 billion.

NetApp’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,156.70 million. The EBITDA margin is 18.29% (the operating margin is 11.61% and the net profit margin 10.08%).

Financials: The total debt represents 10.80% of NetApp assets and the total debt in relation to the equity amounts to 26.29%. Due to the financial situation, a return on equity of 14.99% was realized by NetApp.

Twelve trailing months earnings per share reached a value of $1.91. Last fiscal year, NetApp paid $0.60 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 1.72 and the P/B ratio is finally 2.99. The dividend yield amounts to 1.89%.

Stock Charts:

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

EMC Corporation -- Yield: 1.73%

EMC Corporation (NYSE:EMC) employs 70,000 people, generates revenue of $24,440.00 million and has a net income of $2,894.00 million. The current market capitalization stands at $51.50 billion.

EMC Corporation’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6,140.00 million. The EBITDA margin is 25.12% (the operating margin is 16.52% and the net profit margin 11.84%).

Financials: The total debt represents 11.98% of EMC Corporation assets and the total debt in relation to the equity amounts to 25.10%. Due to the financial situation, a return on equity of 12.28% was realized by EMC Corporation.

Twelve trailing months earnings per share reached a value of $1.26. Last fiscal year, EMC Corporation paid $0.45 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 21.03, the P/S ratio is 2.11 and the P/B ratio is finally 2.40. The dividend yield amounts to 1.73%.

Stock Charts:

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

Apple -- Yield: 1.65%

Apple (NASDAQ:AAPL) employs 92,600 people, generates revenue of $182,795.00 million and has a net income of $39,510.00 million. The current market capitalization stands at $725.11 billion.

Apple’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $60,503.00 million. The EBITDA margin is 33.10% (the operating margin is 28.72% and the net profit margin 21.61%).

Financials: The total debt represents 15.22% of Apple assets and the total debt in relation to the equity amounts to 31.64%. Due to the financial situation, a return on equity of 33.61% was realized by Apple.

Twelve trailing months earnings per share reached a value of $8.09. Last fiscal year, Apple paid $1.82 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 15.58, the P/S ratio is 3.97 and the P/B ratio is finally 6.62. The dividend yield amounts to 1.65%.

Stock Charts:

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

Gilead Sciences -- Yield: 1.63%

Gilead Sciences (NASDAQ:GILD) employs 7,000 people, generates revenue of $24,890.00 million and has a net income of $12,059.00 million. The current market capitalization stands at $155.13 billion.

Gilead Sciences’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $16,315.00 million. The EBITDA margin is 65.55% (the operating margin is 61.33% and the net profit margin 48.45%).

Financials: The total debt represents 35.78% of Gilead Sciences assets and the total debt in relation to the equity amounts to 80.41%. Due to the financial situation, a return on equity of 90.32% was realized by Gilead Sciences.

Twelve trailing months earnings per share reached a value of $8.80. Last fiscal year, Gilead Sciences paid $0.00 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 12.08, the P/S ratio is 6.23 and the P/B ratio is finally 10.26. The dividend yield amounts to 1.63%.

Stock Charts:

Long-Term Stock Price Chart of Gilead Sciences (GILD)
Long-Term Stock Price Chart of Gilead Sciences (GILD)
Long-Term Dividend Payment History of Gilead Sciences (GILD)
Long-Term Dividend Payment History of Gilead Sciences (GILD)
Long-Term Dividend Yield History of Gilead Sciences (GILD)
Long-Term Dividend Yield History of Gilead Sciences (GILD)

PACCAR -- Yield: 1.33%

PACCAR (NASDAQ:PCAR) employs 23,300 people, generates revenue of $18,997.00 million and has a net income of $1,358.80 million. The current market capitalization stands at $23.45 billion.

PACCAR’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,922.60 million. The EBITDA margin is 15.38% (the operating margin is 10.55% and the net profit margin 7.15%).

Financials: The total debt represents 39.92% of PACCAR assets and the total debt in relation to the equity amounts to 121.88%. Due to the financial situation, a return on equity of 20.30% was realized by PACCAR.

Twelve trailing months earnings per share reached a value of $4.11. Last fiscal year, PACCAR paid $0.86 in the form of dividends to shareholders.

Market Valuation: Here are the price ratios of the company: The P/E ratio is 16.20, the P/S ratio is 1.23 and the P/B ratio is finally 3.48. The dividend yield amounts to 1.33%.

Stock Charts:

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