Dividends4Life: Dividend Stocks With Sustainable Payouts

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Dividend Stocks With Sustainable Payouts

Posted by D4L | Sunday, March 03, 2013 | | 0 comments »

Interested in finding undervalued dividend stocks? We found 5 stocks that appear undervalued by EPS trends and pay an attractive dividend. To create our list we started by screening for stocks that paid a dividend between 2-5%, and a sustainable payout ratio below 50%. A dividend yield below 5% allowed us to stay away from the high yield space.

We then looked for those that appear undervalued relative to EPS trends. Based on the theoretical assumption that if P/E is equal to a constant K, growth in EPS estimates should be matched by proportionate growth in price. Use this list as a starting point for your own analysis: Boeing Co. (BA), Corrections Corporation of America, Etablissements Delhaize Freres et Cie Le Lion S.A. (DEG), EMC Insurance Group Inc. (EMCI) and Flowers Foods, Inc. (FLO).

Source: Seeking Alpha

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