At the end of the day, it's the total return that counts; focusing solely on dividend growth is the wrong approach.
I apply the following criteria when selecting dividend stocks:
Payout ratio (POR) <75% (over three years)
Debt ratio<200% (über drei Jahre hinweg)
Dividendenwachstumsrate (Dividend Growth Rate DGR) >6% ideally over 1,3,5,10 years
Dividend yield at cost price (yield on cost; YoC) >2% or 1.5x-2x YoC S&P 500
Return on sales >5%
Equity ratio >=30%
Return on equity (RoE) >=15%
P/E (price/earnings ratio) low value within the sector to which the share belongs
KCV (price-cash flow ratio; P/FCF) <20
Free cash flow margin (FCM) between 5% and 30% (over three years)
Annual earnings growth (earnings growth) 8%-12%
One point is awarded for each criterion met.
In addition, the share price growth over 1, 3, 5 and ten years should be above $ACWI, because I definitely want to beat it. I also award a maximum of 4 points for this.
Of course, this is the ideal, but I want to get as close as possible.
I have then automated the selection process to find two to three stocks per sector (11 according to the Global Industry Classification Standard (GICS)). The sectors are of course weighted (I can name them if required).
For example, I find the stocks in the "Industrial" sector that I take into the portfolio.
This would include stocks such as $SNA $ITW $WSO or $PCAR $FAST. Or if you are looking for dividend growth stocks, you could take a look at $OC or $NOC.
This is how I go sector by sector to build up my dividend portfolio.
I apply the following criteria when selecting dividend stocks:
Payout ratio (POR) <75% (over three years)
Debt ratio<200% (über drei Jahre hinweg)
Dividendenwachstumsrate (Dividend Growth Rate DGR) >6% ideally over 1,3,5,10 years
Dividend yield at cost price (yield on cost; YoC) >2% or 1.5x-2x YoC S&P 500
Return on sales >5%
Equity ratio >=30%
Return on equity (RoE) >=15%
P/E (price/earnings ratio) low value within the sector to which the share belongs
KCV (price-cash flow ratio; P/FCF) <20
Free cash flow margin (FCM) between 5% and 30% (over three years)
Annual earnings growth (earnings growth) 8%-12%
One point is awarded for each criterion met.
In addition, the share price growth over 1, 3, 5 and ten years should be above $ACWI, because I definitely want to beat it. I also award a maximum of 4 points for this.
Of course, this is the ideal, but I want to get as close as possible.
I have then automated the selection process to find two to three stocks per sector (11 according to the Global Industry Classification Standard (GICS)). The sectors are of course weighted (I can name them if required).
For example, I find the stocks in the "Industrial" sector that I take into the portfolio.
This would include stocks such as $SNA $ITW $WSO or $PCAR $FAST. Or if you are looking for dividend growth stocks, you could take a look at $OC or $NOC.
This is how I go sector by sector to build up my dividend portfolio.
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9Mon
@Investor-College Wow, sounds like a (professional) plan 👍🏽
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@Novius At least that's a sound approach in my eyes. I'm doing very well with it. In the meantime, I have automated everything in Google Sheet with real-time data.
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