Category Archives: Dividend Watch List

U.S. Dividend Watch List: April 21, 2017

Prior Year Performance Review

In our ongoing review of the NLO Dividend Watch List, we have taken the top five stocks on our list from April 22, 2016 and have checked the performance one year later. The top five companies on that list can be seen in the table below.

Symbol Name 2015 Price 2016 Price % change
BF-B Brown-Forman Corp. CL 'B' 46.63 46.26 -0.8%
NPBC National Penn Bancshares 10.72 13.00 21.3%
MAC Macerich 76.81 65.05 -15.3%
AXS Axis Capital Holdings Ltd 54.74 66.20 20.9%
STBA S&T BanCorp. 25.89 34.84 34.6%
      Average 12.1%
         
DJI Dow Jones Industrial 17,977.24 20,547.76 14.3%
SPX S&P 500 2,091.58 2,348.69 12.3%

The average gain of the top five companies from the prior year was +12.10%. This is comparable to the S&P 500 index. With that being said, we stated clearly that there was little case to be made for this list but emphasized that the financial sector provided good risk / reward. As such, if we excluded the two non-financial companies from the top five, Brown-Forman (BF-B) and Macerich (MAC), we end up with an average gain of 25%.

U.S. Dividend Watch List: April 21, 2017

The market continue to trade in a narrow range. However, the 50-day moving average appears to be a short-term resistance line. More volatility is expected in the coming weeks as earnings are announced. This is a good opportunity to take the time to study companies on this list that came off of bad earning reports. A one-time hit to the stock has proven to be an opportune time to accumulate shares for the long run. Below are 26 companies on our list. Continue reading

U.S. Dividend Watch List: April 7, 2017

Previous Year Performance Review

In our ongoing review of the NLO Dividend Watch List, we have taken the top five stocks on our list from April 8, 2016 and have checked the performance one year later. The top five companies on that list can be seen in the table below.

Symbol Name 2015 Price 2016 Price % change
STBA S&T BanCorp. 24.29 33.68 38.7%
THFF First Financial Corp. 32.08 46.75 45.7%
WASH Washington Trust BanCorp. 35.83 49.10 37.0%
OKSB Southwest BanCorp. 14.55 25.60 75.9%
NPBC National Penn Bancshares 10.72 13.00 21.3%
      Average 43.7%
         
DJI Dow Jones Industrial 17,576.96 20,656.10 17.5%
SPX S&P 500 2,047.60 2,355.54 15.0%

The top five companies did exceptionally well with average gains of +43.70%. During the same period, the Dow Jones Industrial Average and S&P 500 returned +17.50% and +15%, respectively. At the time, it was clear to us that the financial sector was the weakest of all industry groups judging by the number of companies belonging to the watch list. The following excerpt was taken from our post last year.

There are too many banks on the list to focus on so anyone interested in taking a early stake in the sector should consider ETFs such as XLF or VFH as the low may not be in yet.  The Wall Street Journal published a good piece on the sector titled, Miserable Year for Banks: Stocks Suffer as Rates Stay Low.

Those ETFs mentioned above (XLF and VFH) returned +32% in one year.

In addition to the financials, we pointed out two companies in the agriculture sector to watch out for, they were Monsanto (MON) and Lindsay (LNN) which returned +34% and +27%, respectively. We said the following about these two companies:

Two companies in the agricultural sectors are trading near their yearly low and worth a look.  Monsanto (MON) and Lindsay (LNN) may have not reached their respective "bottoms" but one should start research at these levels to identify their respective intrinsic values. Our valuation models suggest a possible downside risk of -30% for both companies. How likely are they to reach that level is to be seen. However, one can never pick the exact bottom of the stock price and multiple purchases is a great strategy to deploy. Because Lindsay (LNN) was on our list last year and remain in the same position, we interpret this as a potential bottoming process in the company.

U.S Dividend Watch List: April 7, 2017

The market continues to trade in a tight range between 2,300 and 2,350. We'll have to see if it can hold the 2,300 level and possibly retest 2,400. Despite being near an all-time high, we continue to seek long-term investments at a reasonable price and below are 28 companies you should consider. Continue reading

U.S. Dividend Watch List: March 24, 2017

Prior Year Top Five Performance Review

In our ongoing review of the NLO Dividend Watch List, we have taken the top five stocks on our list from March 25, 2016 and have checked their performance one year later. The top five companies on that list can be seen in the table below.

Symbol Name 2015 Price 2016 Price % change
STBA S&T BanCorp. 25.26 33.61 33.1%
LLY Eli Lilly & 71.12 84.18 18.4%
AIG American International Group, Inc. 52.98 60.88 14.9%
GD General Dynamics Corp. 129.08 187.52 45.3%
WSBC WesBanco 28.70 35.79 24.7%
      Average 27.3%
         
DJI Dow Jones Industrial 17,515.73 20,596.72 17.6%
SPX S&P 500 2,035.94 2,343.98 15.1%

The average return for the top five companies from last year is +27.30% with the biggest gain coming from General Dynamics (GD). The company was trading at 14x net income last year when it appeared on the list. Fast forward to today, the stock is trading at nearly 20x net income so while net income rose only 5%, most of the gain came from multiple expansion. The worst performer was AIG (AIG) which gained +14.90% or 0.2% below the market.

U.S Dividend Watch List: March 24, 2017

The market fell -1.40% for the week with the S&P 500 is approaching 2,300. We'll take a flyer on the idea that a consolidation phase is occurring before any move up or down. Below is the watch list containing 26 companies on our dividend watch list. Continue reading

U.S. Dividend Watch List: March 17, 2017

The S&P 500 appears to be consolidating between 2,350 and 2,400. We will be looking to see if the bull can push above 2,400 level this week.

Although the stock market is virtually at its all-time high, the market fundamentals are comparable to last year. We observed the market multiple of 24x in September 2016 which is the same multiple we are seeing now.  One thing to note is rising interest rates during the same time frame.  The 10-year notes rose to 2.50% from 1.60%, a staggering +56% increase in rate. However, at the same time the stock market is up more than +10%.

As the saying goes, a rising tide lifts all boats.  A bull market lifts all companies and there are only 20 companies on our watch list this week. Continue reading

U.S. Dividend Watch List: March 3, 2017

Top Five Watch List Performance Review

In our ongoing review of the NLO Dividend Watch List, we have taken the top five stocks on our list from March 4, 2017 and have checked the performance one year later. The top five companies on that list can be seen in the table below.

Symbol Name 2015 Price 2016 Price % change
AIG American International Group, Inc. 52.30 64.22 22.8%
MON Monsanto 85.89 114.97 33.9%
AROW Arrow Financial Corp. 26.39 34.75 31.7%
LLY Eli Lilly & 73.60 83.78 13.8%
IPCC Infinity Property & Casualty Corp 75.55 96.10 27.2%
      Average 25.9%
         
DJI Dow Jones Industrial 17,006.77 21,005.71 23.5%
SPX S&P 500 1,999.99 2,383.12 19.2%

We highlighted the top two companies last year. Needless to say, they've done well. However, our assessment of Monsanto (MON) was not accurate as we suggested our reader to be more careful of the projected valuation. Valueline estimated shares to be undervalued by 40% at the time and shares have risen 33% since last year. As for AIG (AIG), shares were trading 30% below book value last year. Since then, shares have climbed 22%.

U.S. Dividend Watch List: March 3, 2017

Another week, another record high which lead to potential rate hike by the Fed. We'll have an update to the Coppock Curve mid week. Until then, please review the list below for dividend paying company trading at or near the low.

Continue reading