Best Services Stock Picks For 2013 | A Selection Of Growth Stocks

Dividend income investors seeking for a high income stream from dividends. In addition, capital gains from stocks trades are a welcome bonus for a long-term investor like me. Over a long period, such capital gains are much higher than the amount of dividends. I personally have a ratio of 1:2. This means for every dollar in dividends I could generate additional two dollars of stock gains. Most of my capital gains are unrealized because I hold them for a very long time.

However, I started a new screen from the services sector. I wanted to know what stocks picks could be the best for next year. Last year’s picks gained 31.16 percent while the sector was up 23.16 percent compared to the previous year.

These are my criteria:

- Forward P/E under 15

- Past 5Y Sales growth over 10 percent

- Earnings per share growth for the next five years over 10 percent

- Operating Margin over 10 percent

- Market capitalization above USD 2 billion

Fourteen stocks fulfilled these criteria of which eight pay dividends and twelve are currently recommended to buy. The results are dominated by business services stocks and discount, variety store concepts.