The price we pay for a stock ultimately determines the return on our investment. Therefore it’s best to get as much growth for the least amount of investment. This translates to stocks that have a combination of high Free Cash Flow and high Dividend Growth Rates.
Our mission is to find those stocks that match our thesis. To do this we ranked the Price-to-Earnings ratio of all stocks in this month’s dividend universe, with a rank of one being the lowest PE. We then added to the PE rank a ranking of the Free Cash Flow growth rate and a ranking of the Dividend Growth Rate. The resulting sum was also ranked — Now we have a blend of the best high growth dividend stocks with the lowest PE ratios. Essentially, this is a “value investing” screen with a dividend focus. We then eliminated any stock with a total return below the market’s long term average of 9%, eliminated stocks that are not in the upper percentiles of their sector (our definition for “Premier” status), and for safety and sustainability, we eliminated stocks with a dividend growth rate higher than the free cash flow growth rate–an unsustainable condition that ultimately would lead to a dividend cut.
From the 886 stocks in our January universe, after the screen, we are left with 73 candidate stocks for further research. The list is sorted from highest value to least value. For convenience, each stock has a link to its GuruFocus.com web page for further data.
Our list of “Premier” High Growth, Low PE Dividend Stocks
Key: [ FCF 5y annual growth rate | Dividend 5y annual growth rate | Total Return 5y annual rate ]
- (FMNB) Farmers National Banc Corp ~ Banks [ 32.1 | 28.7 | 11.4 ]
- (WAYN) Wayne Savings Bancshares Inc ~ Banks [ 19 | 18.4 | 12.9 ]
- (FAF) First American Financial Corp ~ Insurance [ 22 | 15.6 | 10.6 ]
- (ALL) Allstate Corp ~ Insurance [ 16.7 | 13.1 | 13.8 ]
- (HUM) Humana Inc ~ Healthcare Plans [ 47.6 | 18.2 | 18.6 ]
- (ECL) Ecolab Inc ~ Chemicals [ 9.7 | 9.3 | 14.5 ] ♥
- (SRE) Sempra Energy ~ Utilities – Regulated [ 30.7 | 8.1 | 9.1 ]
- (FBMS) First Bancshares Inc ~ Banks [ 17.4 | 13.7 | 11.9 ]
- (PRI) Primerica Inc ~ Insurance [ 23.2 | 20.9 | 24.2 ]
- (NUVR) Nuvera Communications Inc ~ Telecommunication Services [ 24.9 | 9.1 | 23.9 ]
- (FIX) Comfort Systems USA Inc ~ Construction [ 30.6 | 11.2 | 13.9 ]
- (UFPI) UFP Industries Inc ~ Forest Products [ 16 | 13.1 | 20.3 ]
- (AIZ) Assurant Inc ~ Insurance [ 59.6 | 17.8 | 12.9 ]
- (FCNCA) First Citizens BancShares Inc ~ Banks [ 32.2 | 6 | 17.6 ]
- (INTC) Intel Corp ~ Semiconductors [ 11 | 7.1 | 10.1 ]
- (EVR) Evercore Inc ~ Capital Markets [ 19.5 | 17 | 17.1 ]
- (SGU) Star Group LP ~ Oil & Gas [ 12.4 | 7.1 | 9.5 ]
- (SCI) Service Corp International ~ Personal Services [ 16.8 | 15.9 | 15 ]
- (AMAT) Applied Materials Inc ~ Semiconductors [ 28.7 | 20 | 36.8 ]
- (TSCO) Tractor Supply Co ~ Retail – Cyclical [ 23 | 17.1 | 11.4 ]
- (MRTN) Marten Transport Ltd ~ Transportation [ 18.7 | 16.3 | 21.2 ]
- (INDB) Independent Bank Corp ~ Banks [ 13.3 | 13 | 11.6 ]
- (CE) Celanese Corp ~ Chemicals [ 40.3 | 21.3 | 15.8 ]
- (GCBC) Greene County Bancorp Inc ~ Banks [ 17 | 3.7 | 11.5 ]
- (WSM) Williams-Sonoma Inc ~ Retail – Cyclical [ 12.6 | 7.5 | 13.6 ]
- (UNP) Union Pacific Corp ~ Transportation [ 19.8 | 13.4 | 23.4 ]
- (CHCO) City Holding Co ~ Banks [ 11.6 | 6 | 11.7 ]
- (LII) Lennox International Inc ~ Industrial Products [ 24.6 | 20.8 | 18 ]
- (PKG) Packaging Corp of America ~ Packaging & Containers [ 18.3 | 13.4 | 19.3 ]
- (CSL) Carlisle Companies Inc ~ Construction [ 13.9 | 13.3 | 13.1 ]
- (DFS) Discover Financial Services ~ Credit Services [ 18.9 | 12.5 | 12.8 ]
- (THO) Thor Industries Inc ~ Vehicles & Parts [ 13.2 | 8.5 | 12.3 ]
- (CSX) CSX Corp ~ Transportation [ 43.2 | 8.6 | 29.7 ]
- (GL) Globe Life Inc ~ Insurance [ 11.6 | 6.3 | 11.4 ]
- (SPGI) S&P Global Inc ~ Capital Markets [ 40.7 | 14 | 28 ]
- (SIGI) Selective Insurance Group Inc ~ Insurance [ 12.1 | 9.3 | 16.1 ]
- (IDA) Idacorp Inc ~ Utilities – Regulated [ 14.8 | 7.8 | 9.7 ]
- (CTAS) Cintas Corp ~ Business Services [ 34.8 | 24.6 | 32 ]
- (POWI) Power Integrations Inc ~ Semiconductors [ 14.6 | 9.8 | 28 ]
- (HSY) The Hershey Co ~ Consumer Packaged Goods [ 23.5 | 7.7 | 13.2 ]
- (KLAC) KLA Corp ~ Semiconductors [ 20.9 | 11.4 | 31.5 ]
- (GNTX) Gentex Corp ~ Vehicles & Parts [ 16.9 | 9.2 | 17.6 ]
- (FFIN) First Financial Bankshares Inc ~ Banks [ 13.3 | 10.6 | 20.5 ]
- (EXPD) Expeditors International of Washington Inc ~ Transportation [ 14 | 8.8 | 17.2 ]
- (COST) Costco Wholesale Corp ~ Retail – Defensive [ 34.4 | 12.5 | 20.2 ] ♥
- (SHW) Sherwin-Williams Co ~ Chemicals [ 18 | 13.3 | 23.8 ]
- (HWKN) Hawkins Inc ~ Chemicals [ 35.6 | 1.5 | 9.7 ]
- (FELE) Franklin Electric Co Inc ~ Industrial Products [ 46.4 | 9.7 | 21.5 ]
- (CLX) Clorox Co ~ Consumer Packaged Goods [ 12 | 7.5 | 11.7 ]
- (FAST) Fastenal Co ~ Industrial Distribution [ 13.9 | 11.4 | 21.1 ]
- (CHE) Chemed Corp ~ Healthcare Providers & Services [ 29 | 8.1 | 29.2 ]
- (BRO) Brown & Brown Inc ~ Insurance [ 12.1 | 9.9 | 25 ]
- (TXRH) Texas Roadhouse Inc ~ Restaurants [ 27.4 | 14.5 | 18.1 ]
- (BMI) Badger Meter Inc ~ Industrial Products [ 28.7 | 11.9 | 27 ]
- (MLM) Martin Marietta Materials Inc ~ Building Materials [ 21.9 | 5.1 | 16.5 ]
- (UMBF) UMB Financial Corp ~ Banks [ 6.9 | 6.2 | 9.9 ]
- (MSFT) Microsoft Corp ~ Software [ 15.3 | 10 | 33 ]
- (CHD) Church & Dwight Co Inc ~ Consumer Packaged Goods [ 12.3 | 8.2 | 16.6 ] ♥
- (FWRD) Forward Air Corp ~ Transportation [ 24.4 | 9 | 13.2 ]
- (NDSN) Nordson Corp ~ Industrial Products [ 15.6 | 11.7 | 26.5 ]
- (MKC) McCormick & Co Inc ~ Consumer Packaged Goods [ 14.5 | 9.1 | 18.7 ] ♥
- (PH) Parker Hannifin Corp ~ Industrial Products [ 13.2 | 8.1 | 24.3 ]
- (MORN) Morningstar Inc ~ Capital Markets [ 22.7 | 9.9 | 24.1 ]
- (PLD) Prologis Inc ~ REITs [ 16.6 | 9.3 | 20.6 ]
- (WST) West Pharmaceutical Services Inc ~ Medical Devices & Instruments [ 30.6 | 8.3 | 36.6 ]
- (PPG) PPG Industries Inc ~ Chemicals [ 9.4 | 8.9 | 9.2 ]
- (FCAP) First Capital Inc ~ Banks [ 14.9 | 2.6 | 20.1 ]
- (MKSI) MKS Instruments Inc ~ Hardware [ 22.4 | 4.3 | 33.8 ]
- (EXP) Eagle Materials Inc ~ Building Materials [ 14.6 | 4.2 | 11.3 ]
- (TGT) Target Corp ~ Retail – Defensive [ 6.1 | 6.1 | 21.1 ]
- (MPW) Medical Properties Trust Inc ~ REITs [ 6.3 | 4.1 | 18.4 ]
- (EGP) EastGroup Properties Inc ~ REITs [ 6.5 | 5.5 | 22.2 ]
- (DLR) Digital Realty Trust Inc ~ REITs [ 7 | 5.6 | 16.1 ]
As a subscriber, we are happy to share the list with you by clicking this DropBox link.
Is this a helpful sort?
__________
Please Note: This information is not an offer to buy stocks, but just a list that has been narrowed down as starting point for your further research. We always recommend further due diligence before making your decision to invest or not.
‘+’ indicates upward direction of DivSys™ score for stocks with positive 10 year dividend growth rates, basically giving us enough years of performance to mathematically determine if they are doing better or doing worse over time.
‘♥’ indicates an all-time, reliable favorite well-suited for most portfolios.