Dividend Aristocrats are stocks from the S&P 500 Dividend Aristocrats Index. The index is created by Standard & Poor's, a subsidiary of McGraw-Hill Companies, and measures the performance of large cap, blue chip companies within the S&P 500 that have followed a policy of increasing dividends every year for at least 25 consecutive years. 51 stocks belong to the index. An additional 54 companies with more than 25 years of dividend growth are on the waiting list - They are named Dividend Champions.
I've tried to figure out those Dividend Aristocrats with the highest potential in terms of earnings growth. That's why I screened the investment category by stocks with a five-year average earnings growth of at least 10 percent yearly. 21 companies fulfilled these criteria, but only eight have a P/E ratio of less than 15. These are the results in detail sorted by dividend yield:
1. Emerson Electric (EMR) has a market capitalization of $33.69 billion. The company generates revenues of $24,222.00 million and has a net income of $2,504.00 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $4,721.00 million. Because of these figures, the EBITDA margin is 19.49% (operating margin is 14.99%, and the net profit margin finally 10.34%).
The total debt representing 21.80% of the company's assets and the total debt in relation to the equity amounts to 50.01%. Last fiscal year, a return on equity of 24.31% was realized. Twelve trailing months earnings per share reached a value of $3.13. Last fiscal year, the company paid $1.38 in form of dividends to shareholders. The company raised dividends for 55 consecutive years and earnings are expected to grow 11.94% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 14.67, Price/Sales 1.39 and Price/Book ratio 3.26. Dividend Yield: 3.48%. The beta ratio is 1.23.
2. AFLAC Incorporated (AFL) has a market capitalization of $18.27 billion. The company generates revenues of $22,171.00 million and has a net income of $1,964.00 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6,761.00 million. Because of these figures, the EBITDA margin is 30.49% (operating margin 13.50% and the net profit margin finally 8.86%).
The total debt representing 2.81% of the company's assets and the total debt in relation to the equity amounts to 24.32%. Last fiscal year, a return on equity of 15.99% was realized. Twelve trailing months earnings per share reached a value of $5.03. Last fiscal year, the company paid $1.23 in form of dividends to shareholders. The company raised dividends for 29 consecutive years and earnings are expected to grow 10.55% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 7.77, Price/Sales 0.82 and Price/Book ratio 1.35. Dividend Yield: 3.38%. The beta ratio is 1.83.
3. Air Products & Chemicals (APD) has a market capitalization of $16.45 billion. The company generates revenues of $10,082.00 million and has a net income of $1,252.60 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $2,499.00 million. Because of these figures, the EBITDA margin is 24.79% (operating margin 16.09% and the net profit margin finally 12.42%).
The total debt representing 32.18% of the company's assets and the total debt in relation to the equity amounts to 79.35%. Last fiscal year, a return on equity of 21.43% was realized. Twelve trailing months earnings per share reached a value of $5.32. Last fiscal year, the company paid $2.23 in form of dividends to shareholders. The company raised dividends for 30 consecutive years and earnings are expected to grow 10.36% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 14.62, Price/Sales 1.63 and Price/Book ratio 2.82. Dividend Yield: 3.29%. The beta ratio is 1.15.
4. Walgreen Company (WAG) has a market capitalization of $27.01 billion. The company generates revenues of $72,184.00 million and has a net income of $2,714.00 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5,393.00 million. Because of these figures, the EBITDA margin is 7.47% (operating margin 6.05% and the net profit margin finally 3.76%).
The total debt representing 8.77% of the company's assets and the total debt in relation to the equity amounts to 16.23%. Last fiscal year, a return on equity of 18.56% was realized. Twelve trailing months earnings per share reached a value of $2.93. Last fiscal year, the company paid $0.75 in form of dividends to shareholders. The company raised dividends for 36 consecutive years and earnings are expected to grow 10.52% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 10.69, Price/Sales 0.37 and Price/Book ratio 1.88. Dividend Yield: 2.87%. The beta ratio is 0.98.
5. 3M (MMM) has a market capitalization of $57.95 billion. The company generates revenues of $29,611.00 million and has a net income of $4,357.00 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $7,414.00 million. Because of these figures, the EBITDA margin is 25.04% (operating margin 20.86% and the net profit margin finally 14.71%).
The total debt representing 16.34% of the company's assets and the total debt in relation to the equity amounts to 33.50%. Last fiscal year, a return on equity of 27.56% was realized. Twelve trailing months earnings per share reached a value of $6.06. Last fiscal year, the company paid $2.20 in form of dividends to shareholders. The company raised dividends for 54 consecutive years and earnings are expected to grow 11.25% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 13.78, Price/Sales 1.96 and Price/Book ratio 3.76. Dividend Yield: 2.83%. The beta ratio is 0.86.
6. Illinois Tool Works (ITW) has a market capitalization of $25.56 billion. The company generates revenues of $17,786.58 million and has a net income of $2,017.01 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $3,320.68 million. Because of these figures, the EBITDA margin is 18.67% (operating margin 15.35% and the net profit margin finally 11.34%).
The total debt representing 22.19% of the company's assets and the total debt in relation to the equity amounts to 39.83%. Last fiscal year, a return on equity of 20.60% was realized. Twelve trailing months earnings per share reached a value of $3.84. Last fiscal year, the company paid $1.40 in form of dividends to shareholders. The company raised dividends for 48 consecutive years and earnings are expected to grow 12.26% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 13.96, Price/Sales 1.44 and Price/Book ratio 2.59. Dividend Yield: 2.69%. The beta ratio is 1.18.
7. Dover Corporation (DOV) has a market capitalization of $10.11 billion. The company generates revenues of $7,950.14 million and has a net income of $846.36 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,641.10 million. Because of these figures, the EBITDA margin is 20.64% (operating margin 15.23% and the net profit margin finally 10.65%).
The total debt representing 23.02% of the company's assets and the total debt in relation to the equity amounts to 44.36%. Last fiscal year, a return on equity of 17.90% was realized. Twelve trailing months earnings per share reached a value of $4.59. Last fiscal year, the company paid $1.18 in form of dividends to shareholders. The company raised dividends for 56 consecutive years and earnings are expected to grow 11.13% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 11.99, Price/Sales 1.27 and Price/Book ratio 2.05. Dividend Yield: 2.29%. The beta ratio is 1.38.
8. Target Corporation (TGT) has a market capitalization of $36.66 billion. The company generates revenues of $69,865.00 million and has a net income of $2,929.00 million. The firm's earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $7,453.00 million. Because of these figures, the EBITDA margin is 10.67% (operating margin 6.38% and the net profit margin finally 4.19%).
The total debt representing 37.49% of the company's assets and the total debt in relation to the equity amounts to 110.50%. Last fiscal year, a return on equity of 18.71% was realized. Twelve trailing months earnings per share reached a value of $4.34. Last fiscal year, the company paid $1.15 in form of dividends to shareholders. The company raised dividends for 44 consecutive years and earnings are expected to grow 11.79% yearly for the upcoming five years.
Here are the price ratios of the company: The P/E ratio is 12.79, Price/Sales 0.53 and Price/Book ratio 2.35. Dividend Yield: 2.16%. The beta ratio is 0.89.
Disclosure: I am long (MMM).