I attempt to screen and purchase undervalued dividend growth stocks. These companies have increased their dividend for at least 15 years and have a lower than average price to earnings (PE) ratio, a higher operating margin, a low price to book, a reasonable dividend yield and payout ratio. This is easily my favorite part of my financial empire.
Every month I take those stocks that have increased their dividends for 20+ years and manually screen them to create a watch list for my monthly purchase. My goal is to find possibly undervalued companies that have paid an increasing dividend for two or more decades. Even before the arduous task I knew that my watch list was going to be short, with the broad market at an all time high it has to mean that price to earnings ratios will be high and yields will be low. Having a short list doesn’t bother me at all – it just makes it easier [...]