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DIVIDEND-STOCKS

Dividend Stock Discovery Tool

 Dividend Rating  A
 Returns Rating  A
  ** Ratings explained below.
  Symbol  

Parker-Hannifin Corporation


PH increased dividends 22 out of the last 27 years. In 2013 the dividend yield was 2.1%. Dividend distributions were in February, May, August and November. The dividend payout ratio is 26%. In the last 10 years, the stock had an annual compounded return of 14.3% including dividends and stock price appreciation. This is 6.9% higher than the S&P 500 return of 7.3%. The company operates in the Industrial Goods sector.

Attribute1 Year3 Year5 Year10 Year
Annual Dividend Yield2.14%2.04%2.17%1.84%
Annual Dividend Growth9.9%18.9%14.5%13.7%
# Years of Dividend Growth1359
Avg Annual Stock Return53.9%16.3%27.1%14.3%
Avg Annual S&P 500 Return32.3%16.1%17.9%7.3%
Annual Stock Volatility21.4%28.1%30.9%29.7%
Annual S&P 500 Volatility8.6%12.1%15.8%14.6%
*   Only full years' data used for calculations (ending Dec 31st, 2013 )
** Please see explanantions of the chart attributes below

What Are Dividend Stocks and What's So Great About Them?


Dividend stocks are stocks of companies which have a proven track record of paying out a portion of their earnings to the stock holder in the form of dividends year after year. In the long run, about 40% of the stock market’s total return comes from dividends.
An additional benefit is that, under the current tax laws, qualified dividends are taxed at 15% instead of your standard income bracket rate which translates into more money in your pocket. Please be aware that the dividends paid by certain companies such as REITs, master limited partnerships, etc., do not qualify for this low rate. Their dividends are considered “unqualified” and hence taxed at your income bracket rate.

Some useful attributes when looking for great dividend stocks are annual dividend yield, growth in dividends, the total annual return (dividends plus stock price gain) and the volatility of the stock. Investors often fail to see the significance of “dividend growth.” A current dividend yield of 3% may not sound all that great. However, if the company increases its dividends year after year, in a decade the annual dividend yield on your original investment may now be 10% because your cost of owning the shares is fixed at the time you purchased them! Any stock price appreciation is an added bonus.

The following is an explanation of the stock ratings and the attributes shown in the above table.

Dividend Rating:  A measure of the stock's dividend growth history and uses the average growth for 1, 3, 5 and 10 year periods. If the average growth is positive for all 4 periods, Rating=A, if positive 3 out of 4 periods, Rating=B, 2 out of 4=C,  and so on.

Returns Rating:  A measure of the stock's total return relative to the S&P 500 return for 1, 3, 5 and 10 year periods.  If it outperformed the S&P for all 4 periods, Rating = A, if 3 out of 4 periods, Rating=B,  and so on.

Annual Dividend Yield: This is the total dividends paid during the year as a percentage of the stock price. On this site, the yield calculation for a given year uses the stock price at the beginning of the year.  For multi-year periods, the annual average is shown.

Annual Dividend Growth: This is the year-over-year growth in the dividend amount. For multi-year periods (eg. 3 year, 5 year) the percentage shown is the simple average of annual growth rates.

# Years of Dividend Growth: The number of years this stock had dividend growth out of the last so many years. For example, if this value is 4 in the “5 Year” column in the chart above, it indicates that the company’s dividends increased 4 out of the last 5 years.

Average Annual Stock Return: This is the compounded annual return which includes all dividends plus stock price appreciation and is a more meaningful number than the dividend yield by itself. At the end of the day, it is the total return that really matters to the investor. A stock with a 15% dividend yield which lost 30% of its stock value for the year is not a great investment.

Annual Stock Volatility: This is how much the stock fluctuates during a 12-month period. The value shown is the annualized standard deviation of monthly price changes (calculated using adjusted closing price in Yahoo Finance). While the calculation itself is somewhat complicated, its explanation is not. In a nutshell, over a 1 year period approximately 2/3 of the time the stock price will be within one standard deviation of the 1 year average price. In general, the lower the volatility, the better.

Annual S&P Return and Volatility: These values are shown as reference points so that you can compare the stock’s performance relative to the broad market represented by the SPDR S&P 500 ETF (SPY). They will help you see a stock’s return and volatility in proper perspective. Annual return of -15% may not sound so bad if you knew that for the same period, the S&P was down 18%.

Historical Data:   All calculations are performed using Yahoo Finance adjusted monthly closing price data.  Please see the following link for a detailed explanation of the data: Yahoo Finance Historical Data Explanation.

PH Annual Dividend History
Year#PaymentsDividend%ChangeStockPriceYieldDividend Months
20134$1.789.9%$83.212.14%2, 5, 8, 11
20124$1.6213.3%$73.162.21%2, 5, 8, 11
20114$1.4333.6%$81.361.76%2, 5, 8, 11
20104$1.077%$49.982.14%2, 5, 8, 11
20094$1.008.7%$38.642.59%2, 5, 8, 11
20084$0.9220%$67.251.37%2, 5, 8, 11
20074$0.7717.3%$45.241.69%2, 5, 8, 11
20064$0.6514%$38.341.7%2, 5, 8, 11
20054$0.5713.2%$43.441.32%2, 5, 8, 11
20044$0.510%$33.691.5%2, 5, 8, 11
* StockPrice shown is the Yahoo adjusted closing price on Dec 31st of previous year.
* Dividend Months: 1=Jan, 2=Feb, 3=Mar, 4=Apr, 5=May, 6=Jun, 7=Jul, 8=Aug, 9=Sep, 10=Oct, 11=Nov, 12=Dec.


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