Looking at the S&P500 I've Identified nine stocks that many investors own and most investors would consider to be "quality" stocks that pay a very nice dividend of between 3.28% and 5.67%. In selecting these, I've chosen only those stocks that have sufficient earnings next year to cover those dividend payments. The nine companies include AT&T, Caterpillar, Dow Chemical, Duke Energy, General Electric, General Motors, McDonalds, Philip Morris, and Verizon.
Each of these companies have promising growth potential going forward and they're companies I would consider for accumulation at some point depending on price. For the most part the one year estimated return on invested capital for these companies is 8% or better. With selective entry most of them could return 10% or better for the year. While this in itself is not sufficient for me to start a position in any one of these companies, it is a good starting point for further research.
Each of these companies have promising growth potential going forward and they're companies I would consider for accumulation at some point depending on price. For the most part the one year estimated return on invested capital for these companies is 8% or better. With selective entry most of them could return 10% or better for the year. While this in itself is not sufficient for me to start a position in any one of these companies, it is a good starting point for further research.
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1. AT&T Inc. provides telecommunications services in the United States and internationally. The company operates through two segments, Wireless and Wireline. The Wireless segment offers data and voice services, including local, long-distance, and network access services, as well as roaming services to youth, family, professionals, small businesses, government, and business customers. This segment also sells various handsets, wirelessly enabled computers, and personal computer wireless data cards through its owned stores, agents, or third-party retail stores; and accessories, such as carrying cases, hands-free devices, batteries, battery chargers, and other items to consumers, as well as to agents and third-party distributors. As of December 31, 2014, it served approximately 120 million wireless subscribers. The Wireline segment provides switched and dedicated transport, DSL Internet access, network integration, managed Web-hosting, packet, and enterprise networking services, as well as intrastate, interstate, and international wholesale networking capacity to other service providers. It also offers voice services consisting of local and long-distance services; and wholesale switched access services to other service providers, as well as sells customer premises equipment and other equipment comprising basic telephones and private digital switching systems. This segment served 9 million retail consumer access lines, 9 million retail business access lines, and 2 million wholesale access lines. The company was formerly known as SBC Communications Inc. and changed its name to AT&T Inc. in November 2005. AT&T Inc. was founded in 1983 and is based in Dallas, Texas. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $33.13 1yr Target $34.09 Analysts 23 1yr Cap Gain 2.89% Dividend $1.88 Yield 5.67% 1yr Est Tot Return 8.56% 3yr DivGR 2.25% 5yr DivGR 2.32% P/E 27.84 PEG 5.95 | Market Cap $171.95 Bil Beta 0.40 EPS (ttm) $1.19 Payout Ratio 157.98% EPS next yr $2.59 Forward P/E 12.80 Debt/Equity 0.95 ROA 2.10% ROE 6.90% ROI 4.90% Sales $132.45 Bil Income $6.22 Bil Profit Margin 4.69% |
2. Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. The company’s Construction Industries segment offers backhoe, small wheel, skid steer, multi-terrain, compact track, medium and compact wheel, and track-type loaders; mini, wheel, and track excavators; track-type tractors; and select work tools, motor graders, telehandlers, soil compactors, and pipelayers, as well as its related parts for the heavy and general construction, rental, mining and quarry, and aggregates markets. Its Resource Industries segment provides electric rope and hydraulic shovels; draglines; drills; highwall and longwall miners; hard rock vehicles; articulated, large mining, and off-highway trucks; large wheel loaders; wheel tractor scrapers; wheel dozers; machinery components; and electronics and control systems for use in mining and quarry applications. The company’s Energy & Transportation segment offers reciprocating engines; reciprocating engine powered generator sets; integrated systems and solutions for the electric power generation industry; and turbines and its related services, centrifugal gas compressors, diesel-electric locomotives and components, and rail-related products and services. Its Financial Products segment provides retail and wholesale financing primarily for Caterpillar equipment, machinery, and engines; offers property, casualty, life, accident, and health insurance; insurance brokerage services; and purchases short-term trade receivables. The company’s All Other segments remanufactures engines and components; provides business strategy, and development, management, manufacturing, marketing, and support primarily for paving, forestry, industrial, waste, and Cat products. The company was formerly known as Caterpillar Tractor Co. and changed its name to Caterpillar Inc. in 1986. The company was founded in 1925 and is headquartered in Peoria, Illinois. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $80.24 1yr Target $84.29 Analysts 21 1yr Cap Gain 5.04% Dividend $2.80 Yield 3.48% 1yr Est Tot Return 8.52% 3yr DivGR 12.90% 5yr DivGR 9.12% P/E 13.67 PEG 1.41 | Market Cap $48.64 Bil Beta 1.64 EPS (ttm) $5.87 Payout Ratio 47.70% EPS next yr $5.03 Forward P/E 15.94 Debt/Equity 2.35 ROA 4.30% ROE 19.30% ROI 7.00% Sales $55.18 Bil Income $3.70 Bil Profit Margin 6.70% |
3. The Dow Chemical Company manufactures and supplies products that are used primarily as raw materials in the manufacture of customer products and services worldwide. It operates through Agricultural Sciences, Consumer Solutions, Infrastructure Solutions, Performance Materials & Chemicals, and Performance Plastics segments. The Agricultural Sciences segment provides crop protection and seed/plant biotechnology products and technologies, urban pest management solutions and healthy oils, insecticides, fungicides, herbicides, and seeds. The Consumer Solutions segment offers semiconductors and organic light-emitting diodes, and adhesives and foams used by the transportation industry; and cellulosics for pharmaceutical formulations and food solutions. It serves automotive, electronics and entertainment, healthcare and medical, and personal and home care goods markets. The Infrastructure Solutions segment provides architectural and industrial coating applications, building insulation, adhesives, and microbial protection products for the oil and gas industry; water purification and separation technologies, such as reverse osmosis membranes and ion exchange resins; and monomer products. The Performance Materials & Chemicals segment offers chlorine and caustic soda; chlorinated organic products and solutions; epoxy resins, curing agents, intermediates, and systems; industrial solutions; and propylene oxides, propylene glycols, polyether polyols, and aromatic isocyanates. The Performance Plastics segment provides elastomers, polyolefin plastomers, and ethylene propylene diene monomer elastomers; wire and cable insulation, semiconductive, and jacketing compound solutions, as well as bio-based plasticizers; acrylics, polyethylene, polyolefin emulsions, and polyolefin plastomers; and ethylene, propylene, benzene, butadiene, cumene, octene, aromatics co-products, and crude c4. The company was founded in 1897 and is headquartered in Midland, Michigan. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $48.24 1yr Target $52.05 Analysts 20 1yr Cap Gain 7.89% Dividend $1.68 Yield 3.48% 1yr Est Tot Return 11.37% 3yr DivGR 19.13% 5yr DivGR 33.35% P/E 16.81 PEG 1.42 | Market Cap $55.85 Bil Beta 1.68 EPS (ttm) $2.87 Payout Ratio 58.53% EPS next yr $3.58 Forward P/E 16.81 Debt/Equity 1.07 ROA 4.90% ROE 15.90% ROI 10.30% Sales $58.17 Bil Income $3.41 Bil Profit Margin 5.86% |
4. Duke Energy Corporation operates as an energy company in the United States and Latin America. It operates through three segments: Regulated Utilities, International Energy, and Commercial Power. The Regulated Utilities segment generates, transmits, distributes, and sells electricity in the Carolinas, Florida, Ohio, Kentucky, and Indiana; and transports and sells natural gas in southwestern Ohio and northern Kentucky. This segment owns approximately 50,000 megawatts of generation capacity; and uses coal, hydroelectric, natural gas, oil, and nuclear fuel to generate electricity. It serves approximately 7.3 million retail electric customers in 6 states in the Southeast and Midwest regions of the United States with a service area covering approximately 95,000 square miles; and approximately 500,000 retail natural gas customers in southwestern Ohio and northern Kentucky. This segment is also involved in the wholesale of electricity to incorporated municipalities, electric cooperative utilities, and other load-serving entities. The International Energy segment operates and manages power generation facilities; and markets and sells electric power, natural gas, and natural gas liquids. This segment serves retail distributors, electric utilities, independent power producers, marketers, and industrial and commercial companies. The Commercial Power segment builds, develops, and operates wind and solar renewable generation and energy transmission projects, as well as high voltage power projects. Duke Energy Corporation is headquartered in Charlotte, North Carolina. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $76.97 1yr Target $82.14 Analysts 14 1yr Cap Gain 6.71% Dividend $3.18 Yield 4.13% 1yr Est Tot Return 10.84% 3yr DivGR 50.98% 5yr DivGR 27.36% P/E 22.12 PEG 4.90 | Market Cap $54.50 Bil Beta 0.15 EPS (ttm) $3.48 Payout Ratio 91.37% EPS next yr $4.96 Forward P/E 15.51 Debt/Equity 1.04 ROA 1.50% ROE 4.40% ROI 4.30% Sales $23.93 Bil Income $2.46 Bil Profit Margin 10.27% |
5. General Electric Company operates as an infrastructure and financial services company worldwide. The company’s Power and Water segment offers gas, steam and aeroderivative turbines, nuclear reactors, generators, combined cycle systems, controls, and related services; wind turbines; and water treatment services and equipment. Its Oil and Gas segment provides surface and subsea drilling and production systems, equipment for floating production platforms, compressors, turbines, turboexpanders, reactors, industrial power generation, and auxiliary equipment. The company’s Energy Management segments offers plant automation hardware, software, and embedded computing systems, including controllers, embedded systems, advanced software, motion control, operator interfaces, and industrial computers. Its Aviation segment offers jet engines; aerospace systems and equipment; and replacement parts and repair and maintenance services for commercial and military aircraft, marine applications, and executive and regional aircraft. The company’s Healthcare segment provides medical imaging, software and information technology (IT), patient monitoring and diagnostics, drug discovery, biopharmaceutical manufacturing technologies, and performance improvement solutions. Its Transportation segment offers freight and passenger locomotives, and diesel engines for rail, marine, and stationary power applications; railway signaling and communications systems; underground mining equipment; motorized drive systems; IT solutions; and replacement parts and value added services. The company’s Appliances & Lighting segment manufactures home appliances; and lighting products for commercial and industrial applications. Its GE Capital segment offers commercial loans and leases, fleet management, financial programs, credit cards, personal loans, and other financial services. The company was founded in 1892 and is headquartered in Fairfield, Connecticut. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $24.94 1yr Target $28.43 Analysts 14 1yr Cap Gain 13.99% Dividend $0.92 Yield 3.68% 1yr Est Tot Return 17.67% 3yr DivGR 13.27% 5yr DivGR 17.34% P/E 16.52 PEG 2.23 | Market Cap $251.08 Bil Beta 1.42 EPS (ttm) $1.51 Payout Ratio 60.92% EPS next yr $1.82 Forward P/E 13.73 Debt/Equity 2.85 ROA 2.80% ROE 13.80% ROI 3.40% Sales $148.59 Bil Income $15.32 Bil Profit Margin 10.31% |
6. General Motors Company designs, builds, and sells cars, crossovers, trucks, and automobile parts worldwide. It operates through GM North America, GM Europe, GM International Operations, GM South America, and GM Financial segments. The company markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Opel, Holden, and Vauxhall brand names, as well as under the Alpheon, Baojun, Jiefang, and Wuling brand names. It also sells cars and trucks to dealers for consumer retail sales, as well as to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies, and governments. In addition, the company offers connected safety, security and mobility solutions, and information technology services. The company, through its subsidiary, General Motors Financial Company, Inc., provides automotive financing services. General Motors Company was founded in 1897 and is based in Detroit, Michigan. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $36.50 1yr Target $41.53 Analysts 17 1yr Cap Gain 13.78% Dividend $1.20 Yield 3.28% 1yr Est Tot Return 17.06% 3yr DivGR N/A 5yr DivGR N/A P/E 21.86 PEG 1.22 | Market Cap $58.78 Bil Beta 1.72 EPS (ttm) $1.67 Payout Ratio 71.85% EPS next yr $5.01 Forward P/E 7.28 Debt/Equity 1.32 ROA 1.60% ROE 7.30% ROI 1.80% Sales $155.93 Bil Income $2.80 Bil Profit Margin 1.79% |
7. McDonald's Corporation operates and franchises McDonald's restaurants in the United States, Europe, the Asia/Pacific, the Middle East, Africa, Canada, and Latin America. The company's restaurants offer various food products, soft drinks, coffee, and other beverages. As of December 31, 2014, it operated 36,258 restaurants, including 29,544 franchised restaurants comprising 20,774 franchised to conventional franchisees, 5,228 licensed to developmental licensees, and 3,542 licensed to foreign affiliates; and 6,714 company-operated restaurants. The company was founded in 1940 and is based in Oak Brook, Illinois. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $95.83 1yr Target $100.04 Analysts 18 1yr Cap Gain 4.39% Dividend $3.40 Yield 3.54% 1yr Est Tot Return 7.93% 3yr DivGR 8.94% 5yr DivGR 9.85% P/E 19.88 PEG 3.20 | Market Cap $92.10 Bil Beta 0.36 EPS (ttm) $4.82 Payout Ratio 70.53% EPS next yr $5.35 Forward P/E 17.92 Debt/Equity 1.17 ROA 13.20% ROE 32.40% ROI 19.20% Sales $27.44 Bil Income $4.76 Bil Profit Margin 17.34% |
8. Philip Morris International Inc., through its subsidiaries, manufactures and sells cigarettes, other tobacco products, and other nicotine-containing products. Its portfolio of brands comprise Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company also owns various cigarette brands comprising Sampoerna, Dji Sam Soe, and U Mild in Indonesia; Fortune, Champion, and Hope in the Philippines; Diana in Italy; Optima and Apollo-Soyuz in Russia; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. It sells its products in approximately 180 countries in the European Union, Eastern Europe, the Middle East, Africa, Asia, Latin America, and Canada. The company was incorporated in 1987 and is headquartered in New York, New York. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $77.26 1yr Target $81.29 Analysts 14 1yr Cap Gain 5.21% Dividend $4.00 Yield 5.17% 1yr Est Tot Return 10.38% 3yr DivGR 11.10% 5yr DivGR 11.61% P/E 16.16 PEG 2.99 | Market Cap $119.68 Bil Beta 0.92 EPS (ttm) $4.78 Payout Ratio 83.68% EPS next yr $4.56 Forward P/E 16.96 Debt/Equity UNK ROA 26.10% ROE -91.80% ROI 51.10% Sales $119.68 Bil Income $7.46 Bil Profit Margin 6.23% |
9. Verizon Communications Inc., through its subsidiaries, provides communications, information, and entertainment products and services to consumers, businesses, and governmental agencies worldwide. The company’s Wireless segment offers wireless voice and data services; messaging services; service that enables its customers to access the Internet on smartphones, basic phones, notebook computers, and tablets; customers and business-focused multimedia offerings; location-based services; global data services; LTE Internet, a high-speed Internet service; and network access and value added services to support telemetry-type applications. It also offers machine-to-machine services that support devices used in health monitoring, education, manufacturing, utilities, distribution, and consumer products markets, as well as offers smartphones and basic phones, tablets, and other Internet access devices. As of December 31, 2014, it had 108.2 million retail connections. Its Wireline segment provides high-speed Internet, FiOS Internet, and FiOS Video services; voice services, such as local exchange, regional and long distance calling, and voice messaging services, as well as VOIP services; private Internet protocol and Ethernet access and optical services; and Internet protocol, infrastructure and cloud services, machine-to-machine services, security, and other communications services. It also offers voice and data services, such as conferencing and contact center solutions, and private line and data access networks, as well as customer premise equipment, installation, maintenance, and site services; and data, voice, local dial tone, and broadband services primarily to local, long distance, and other carriers. The company was formerly known as Bell Atlantic Corporation and changed its name to Verizon Communications Inc. in June 2000. Verizon Communications Inc. was founded in 1983 and is based in New York, New York. (Summary) (Company) (Daily Chart)
| 5 April 2015 Price $49.47 1yr Target $51.50 Analysts 26 1yr Cap Gain 4.10% Dividend $2.20 Yield 4.44% 1yr Est Tot Return 8.54% 3yr DivGR N/A 5yr DivGR N/A P/E 19.63 PEG 2.60 | Market Cap $201.46 Bil Beta 0.37 EPS (ttm) $2.52 Payout Ratio 87.30% EPS next yr $3.88 Forward P/E 12.76 Debt/Equity 9.21 ROA 4.30% ROE 68.20% ROI 13.00% Sales $127.08 Bil Income $9.63 Bil Profit Margin 7.57% |
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