Dividend stocks are everywhere, but many just downright stink. In some cases, the business model is in serious jeopardy, or the dividend itself isn't sustainable. In others, the dividend is so low, it's not even worth the paper your dividend check is printed on. A�solid dividend�strikes the right balance of growth, value, and sustainability.
Today, and one day each week for the rest of the year, we're going to look at one dividend-paying company that you can put in your portfolio for the long term without too much concern. This isn't to say that these stocks don't share the same macro risks that other companies have, but they are a step above your common grade of dividend stock. Check out�last week's selection.
This week, we'll turn our attention to a company that literally keeps America trucking, Cummins (NYSE: CMI ) , and I'll show you why it and its dividend could drive your portfolio to big gains.
Cummins, a manufacturer of diesel and natural gas engines, as well as a provider of engine components and power generation products, has soared some 500% since its recession lows. The most amazing aspect about this heavy-duty engine maker is that it could still have plenty of room to run higher.
Top 10 Sliver Stocks To Buy For 2015: Grand Canyon Education Inc.(LOPE)
Grand Canyon Education, Inc. provides postsecondary education services in the United States and Canada. It focuses on offering graduate and undergraduate degree programs in education, healthcare, business, and liberal arts disciplines. The company provides its courses through traditional ground campus in Phoenix, Arizona; online; and onsite at the facilities of employers. As of December 31, 2011, it had 43,917 students enrolled in its courses. The company was formerly known as Significant Education, Inc and changed its name to Grand Canyon Education, Inc. in May 2008. Grand Canyon Education, Inc. was founded in 1949 and is based in Phoenix, Arizona.
Advisors' Opinion:- [By Seth Jayson]
Calling all cash flows
When you are trying to buy the market's best stocks, it's worth checking up on your companies' free cash flow once a quarter or so, to see whether it bears any relationship to the net income in the headlines. That's what we do with this series. Today, we're checking in on Grand Canyon Education (Nasdaq: LOPE ) , whose recent revenue and earnings are plotted below. - [By Jeremy Bowman]
What: Shares of Grand Canyon Education (NASDAQ: LOPE ) were riding high today, gaining as much as 16% after soaring past estimates in its earnings report.
Top 10 Trucking Stocks To Invest In Right Now: Genel Energy PLC (GEGYF.PK)
Genel Energy plc, formerly Vallares PLC, is an exploration and production company. It is an independent oil producer in the Kurdistan Region of Iraq. The Group has two reportable business segments, which are its oil and gas exploration and production business in the KRI and its oil and gas exploration business in Africa. The Company had operational bases in Ankara, Turkey; in Taq Taq, Erbil and Suleimaniah in the Kurdistan Region, and in London. The Company�� oil producing fields of Taq Taq (in which it held a 44% interest) and Tawke (25% interest) had estimated gross proven and probable reserves of 1.2 billion barrels of oil and proven, probable and possible reserves of 1.9 billion barrels of oil. The Company�� subsidiaries include: Genel Energy Holding Company Ltd, Genel Energy Somaliland Limited, A&T Petroleum Limited, Genel Energy UK Services Limited, Genel Energy Netherlands Holding 2 B.V. and Genel Energy Somaliland Limited. Advisors' Opinion:- [By Street Smart Investor]
DNO International is an independent E&P company, geographically focused on the Middle East and North Africa with operations in Yemen, the Kurdistan region of Iraq, Tunisia, Oman, Ras Al Khaimah and Somaliland. The company's asset portfolio currently stands at 20 assets in six countries. For the year ended December 2012, DNO International has proven and probable reserves of 520.3 MMboe with 90% of the reserves in the Kurdistan region of Iraq. The company's reserves in Kurdistan come from the Tawke oil block, which is among the largest oil blocks in Kurdistan. DNO International has a 55% stake in the Tawke block with Genel Energy PLC (GEGYF.PK) holding a 25% stake. The remaining 20% stake is held by the Kurdistan Regional Government. For the first half of 2013, DNO International had a production rate of 33,917 boepd, which includes production from Kurdistan, Oman and Yemen.
Top 10 Trucking Stocks To Invest In Right Now: Arctic Gold Publ AB (ARCT)
Arctic Gold Publ AB, formerly known as Alcaston Exploration AB, is a Sweden-based exploration and mine development company. Its main focus is on the Bidjovagge gold and copper ore field in northern Norway. The project is located in the municipality of Kautokenio. Apart from that, the Company�� portfolio comprises gold and base metal projects in the Norrbotten and Vasterbotten in northern Sweden. As of December 31, 2011, the Company held 78 exploration permits in Norway, comprising a total of 23.1 square kilometers. In Sweden the Company has 12 exploration permits comprising 17.4 square kilometers. As of December 31, 2011, the Company had one wholly owned subsidiary, namely Arctic Gold Operations AB. As of December 31, 2011, the Company�� largest shareholder was M.Elsasser & CIE AG (12.06%). Advisors' Opinion:- [By Brad Thomas]
He has undeniably delivered for his investors. In the space of 18 months, Mr. Schorsch has executed three transactions. He helped with the roadshow for Healthcare Trust of America (HTA), a non-traded REIT for which he served as broker-dealer and raised nearly $1 billion. He also listed American Realty Capital Trust (ARCT) for public trading and merged ARCT III with his own American Realty Capital Properties (ARCP). The three deals netted investors internal rates of return of 11%, 14% and 33%, respectively, according to company data. In the meantime, publicly traded shares of ARCP have increased 60% - to $16, from $10 - since last July.
Top 10 Trucking Stocks To Invest In Right Now: Credit Acceptance Corporation(CACC)
Credit Acceptance Corporation, together with its subsidiaries, provides auto loans, and related products and services to consumers in the United States. Its loan programs include portfolio program, which advances money to dealer-partners in exchange for the right to service the underlying consumer loans; and purchase program that buys the consumer loans from the dealer-partners and keeps amounts collected from the consumers. The company markets its products through a network of approximately 55,000 independent and franchised automobile dealers. Credit Acceptance Corporation was founded in 1972 and is headquartered in Southfield, Michigan.
Advisors' Opinion:- [By Eric Volkman]
Credit Acceptance (NASDAQ: CACC ) will see big blocks of its shares change hands over the next few days. The company has specified the pricing of a previously announced underwritten public secondary stock common offering of $105.00 per share. Trusts associated with the firm's founder Donald Foss, in combination with Karol Foss and people and entities connected with Prescott General Partners, aim to sell a combined 1.5 million of their shares. Additionally, the underwriters will have a 30-day option to buy up to an extra 225,000 shares.
- [By Richard Moroney]
Credit Acceptance (CACC) provides financing for auto purchases through a national network of nearly 4,500 car dealers. Its programs help dealers sell cars by attracting credit-challenged consumers unable to get conventional loans.
Top 10 Trucking Stocks To Invest In Right Now: Community Trust Bancorp Inc.(CTBI)
Community Trust Bancorp, Inc. operates as the holding company for Community Trust Bank, Inc. that provides various banking products and services. It accepts various deposit product that include checking accounts, regular and term savings accounts and savings certificates, commercial demand deposit accounts, individual retirement accounts and Keogh plans, non interest bearing deposits, NOW accounts, money market deposits, savings accounts, and certificates of deposit and other time deposits. The company?s loan portfolio comprises residential and commercial real estate loans; commercial loans; commercial, construction, mortgage, and personal loans; and lease-financing, lines of credit, revolving lines of credit, term loans, and other specialized loans, including asset-based financing. It also provides full service securities brokerage services; annuity and life insurance products; trust services; debit cards; cash management services to corporate and individual customers; l etters of credit; safe deposit boxes; and funds transfer services. In addition, the company acts as a trustee of personal trusts, an executor of estates, trustee for employee benefit trusts, registrar, transfer agent, paying agent for bond and stock issues; and depositor for securities, as well as provides full service brokerage services. Community Trust operates 80 banking locations in eastern, northeastern, central, and south central Kentucky; southern West Virginia; and northeastern Tennessee, as well as 5 trust offices across Kentucky. The company was founded in 1903 and is headquartered in Pikeville, Kentucky.
Advisors' Opinion:- [By Dividends4Life]
Fair Value: In calculating fair value, I consider the NPV MMA Differential Fair Value along with these four calculations of fair value, see page 2 of the linked PDF for a detailed description:
1. Avg. High Yield Price
2. 20-Year DCF Price
3. Avg. P/E Price
4. Graham Number
NUE is trading at a premium to all four valuations above. The stock is trading at a 85.8% premium to its calculated fair value of $28.51. NUE did not earn any Stars in this section.
Dividend Analytical Data: In this section there are three possible Stars and three key metrics, see page 2 of the linked PDF for a detailed description:
1. Free Cash Flow Payout
2. Debt To Total Capital
3. Key Metrics
4. Dividend Growth Rate
5. Years of Div. Growth
6. Rolling 4-yr Div. > 15%
NUE earned one Star in this section for 2.) above. The stock earned a Star as a result of its most recent Debt to Total Capital being less than 45%. The company has paid a cash dividend to shareholders every year since 1973 and has increased its dividend payments for 40 consecutive years.
Dividend Income vs. MMA: Why would you assume the equity risk and invest in a dividend stock if you could earn a better return in a much less risky money market account (MMA) or Treasury bond? This section compares the earning ability of this stock with a high yield MMA. Two items are considered in this section, see page 2 of the linked PDF for a detailed description:
1. NPV MMA Diff.
2. Years to > MMA
The negative NPV MMA Diff. means that on a NPV basis the dividend earnings from an investment in NUE would be less than a similar amount invested in MMA earning a 20-year average rate of 3.68%. If NUE grows its dividend at 0.7% per year, it will never equal a MMA yielding an estimated 20-year average rate of 3.68%.
Memberships and Peers: NUE is a member of the S&P 500, a Dividend Aristocrat, a member of the Broad Dividend Achievers - [By Dividends4Life]
Fair Value: In calculating fair value, I consider the NPV MMA Differential Fair Value along with these four calculations of fair value, see page 2 of the linked PDF for a detailed description:
1. Avg. High Yield Price
2. 20-Year DCF Price
3. Avg. P/E Price
4. Graham Number
GWW is trading at a premium to all four valuations above. The stock is trading at a 10.0% premium to its calculated fair value of $219.95. GWW did not earn any Stars in this section.
Dividend Analytical Data: In this section there are three possible Stars and three key metrics, see page 2 of the linked PDF for a detailed description:
1. Free Cash Flow Payout
2. Debt To Total Capital
3. Key Metrics
4. Dividend Growth Rate
5. Years of Div. Growth
6. Rolling 4-yr Div. > 15%
GWW earned three Stars in this section for 1.), 2.) and 3.) above. A Star was earned since the Free Cash Flow payout ratio was less than 60% and there were no negative Free Cash Flows over the last 10 years. The stock earned a Star as a result of its most recent Debt to Total Capital being less than 45%. GWW earned a Star for having an acceptable score in at least two of the four Key Metrics measured.
Rolling 4-yr Div. > 15% means that dividends grew on average in excess of 15% for each consecutive 4 year period over the last 10 years (2003-2006, 2004-2007, 2005-2008, etc.) I consider this a key metric since dividends will double every 5 years if they grow by 15%. The company has paid a cash dividend to shareholders every year since 1965 and has increased its dividend payments for 42 consecutive years.
Dividend Income vs. MMA: Why would you assume the equity risk and invest in a dividend stock if you could earn a better return in a much less risky money market account (MMA) or Treasury bond? This section compares the earning ability of this stock with a high yield MMA. Two items are considered in this section, see page 2 of the linked - [By Dividends4Life]
Linked here is a detailed quantitative analysis of Community Trust Bank Corp. (CTBI). Below are some highlights from the above linked analysis:
Company Description: Community Trust Bank Corp. owns and operates Community Trust Bank, Inc. of Pikeville, KY, which provides commercial banking services in Kentucky and West Virginia; and a trust company.
Top 10 Trucking Stocks To Invest In Right Now: Donegal Group Inc.(DGICB)
Donegal Group Inc., through its subsidiaries, offers personal and commercial lines of property and casualty insurance to businesses and individuals in the United States. The company?s personal lines of insurance products include private passenger automobile insurance, which provides protection against liability for bodily injury and property damage arising from automobile accidents, and protection against loss from damage to automobiles owned by the insured; and homeowners insurance that offers coverage for damage to residences and their contents from a range of perils, including fire, lightning, windstorm, and theft, as well as covers liability of the insured arising from injury to other persons or their property. Its commercial lines of insurance products comprise commercial automobile policies that provide protection against liability for bodily injury and property damage arising from automobile accidents, and protection against loss from damage to automobiles owned by the insured; commercial multi-peril policies, which offer protection to businesses against various perils primarily combining liability and physical damage coverages; and workers? compensation policies that provide benefits to employees for injuries sustained during employment. Donegal Group Inc. markets its insurance products through a network of approximately 2,200 independent insurance agencies. As of December 31, 2010, it wrote business in 22 states of the United States. The company was founded in 1986 and is headquartered in Marietta, Pennsylvania.
Advisors' Opinion:- [By Luke Jacobi]
Donegal Group (NASDAQ: DGICB) closed up 14.86 percent to $23.95 after Gregory Shepard offered $33-$37 per share for Donegal Group.
The ExOne (NASDAQ: XONE) gained 4.13 percent to closed at $48.32 as 3D printing stocks once again were spotlighted for today's trading session.
- [By Jake L'Ecuyer]
Shares of Donegal Group (NASDAQ: DGICB) got a boost, shooting up 16.24 percent to $23.22 after Gregory Shepard offered $33-$37 per share for Donegal Group.
Top 10 Trucking Stocks To Invest In Right Now: Primo Water Corporation(PRMW)
Primo Water Corporation, together with its subsidiaries, provides three- and five-gallon purified bottled water, self-serve filtered drinking water, water dispensers, and carbonating beverage appliances in the United States and Canada. The company?s Primo Water segment sells multi-gallon purified bottled water and self-serve filtered drinking water vending service through retailers in the United States and Canada. It offers its services through point of purchase display racks or self-serve filtered water vending displays, and recycling centers. Its Primo Dispensers segment sells water dispensers that are designed to dispense Primo and other dispenser-compatible bottled water. This segment engages in dispensers sales primarily through retailers. The company also offers home beverage appliances, flavor concentrates, carbon dioxide cylinders, and accessories used with the appliances to make various cold beverages. As of December 31, 2011, its exchange and refill services wer e offered in each of the contiguous United States and in Canada at approximately 23,600 combined retail locations. Primo Water Corporation was founded in 2004 and is headquartered in Winston-Salem, North Carolina.
Advisors' Opinion:- [By Roberto Pedone]
Primo Water (PRMW) is a provider of multi-gallon purified bottled water, self-serve filtered drinking water, water dispensers and carbonating beverage appliances sold through major retailers in the U.S. and Canada. This stock closed up 9.6% to $2.16 in Thursday's trading session.
Thursday's Range: $1.97-$2.20
52-Week Range: $0.69-$2.20
Thursday's Volume: 329,000
Three-Month Average Volume: 145,397From a technical perspective, PRMW ripped higher here right above some near-term support at $1.85 with heavy upside volume. This stock broke out above some near-term overhead resistance at $2.14 and into new 52-week-high territory, which is bullish technical price action.
Traders should now look for long-biased trades in PRMW as long as it's trending Thursday's low of $1.97 and then once it sustains a move or close above its new 52-week high at $2.20 and above some past resistance at $2.28 with volume that hits near or above 145,397 shares. If we get that move soon, then PRMW will set up to enter new 52-week-high territory, which is bullish price action. Some possible upside targets off that move are its next major overhead resistance levels at $3 to $3.11.
- [By John Udovich]
Small cap water stocks Primo Water Corporation (NASDAQ: PRMW), Arrowhead Water Products Ltd. (CVE: AWA) and Alkaline Water Company Inc (OTCBB: WTER) might be the last place you expect to see much action, but these stocks have been boiling lately for investors���either with news or they have been producing profits:
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