How To Use the DividendGeek Watchlist

Listed below are descriptions for each column on the watch list (starting at the first column on the left).

Company Info

Ticker – Stock symbol, or the abbreviation to uniquely identify a public company stock

Sector – Industry Classification of the company, their are 11 industry sectors:

  1. Con Disc = Consumer Discretionary
  2. Con Stap = Consumer Staples
  3. Energy
  4. Financials
  5. Healthcare
  6. Industrial
  7. Materials
  8. REIT = Real Estate Investment Trusts
  9. Tech = Information Technology
  10. Telecomm = Telecommunications Services
  11. Utilities

Annual Div Pmt $ – Annual dividend payment amount (mainly used to calculate dividend yield).

Strength

Yrs Div Up –  Number of consecutive years a company has increased their dividend payment.

MS Econ Moat – Morningstar economic moat ratings, of how strong (wide) are the competitive advantages of a company, from best to worst: ‘Wide’, ‘Narrow’ and ‘None.’

Growth Potential

Div Yield % – The current dividend yield of a Company (dividend payment amount / current price). I prefer a minimum of 2.00% at time of purchase.

5 Yr DGR – The average dividend growth rate over the past 5 years. I prefer a 5-year DGR greater than 5.00% to stay ahead of inflation during retirement.

Chowder Rule Y+DGR –  Current yield + 5 year dividend growth rate. Named after “Seeking Alpha” member Chowder, this is a method of identifying candidates for purchase when the sum of of the yield and DGR is above 12% represents a good entry point. Caution: This ‘Rule” is intended to be used in conjunction with measures of quality, such as high marks for safety and financial stability. (Credit: David Fish’s U.S.DividendChampions “CCC” spreadsheet)

Most Recent % Up – The most recent dividend payment percent increase.

Est 5 Yr Grwth – The estimated annual Earning Per Share (EPS) growth for the next five years. Ideally I like to see the company earnings growth close to the 5 Year DGR which is one indicator of maintaining dividend growth rate into the future. EPS growth rates above the DGR is one sign of possible higher dividend growth rates in the future.

Sustainability

EPS % Payout – Annual earning per share / dividends per share = the ratio of earning paid out to shareholders in the form of dividends. The lower the payout ratio the better, since it leaves room for consistent dividend growth. I prefer payout ratios below 75%, however high payout ratio’s may be acceptable in providing a sustainable dividend payment and should be evaluated on the individual stock and industry it’s in. For example, many companies are required to payout the majority of earning in dividends (e.g.: utilities, REITs MLPs, tobacco companies).

Debt to Equity The ratio of shareholder equity to debt to finance a company. The lower the ratio (less debt) the better. Typically a ratio of 1 or less is acceptable. From 1 to 1.6 is a warning. Above 1.6 can be acceptable, but needs to be investigated on an individual stock and industry basis.

Price

Current Price – The current market price (quote may be delayed 20 minutes). “Price is what you pay. Value is what you get.” -Warren Buffett

% Change – Percent change is the difference in stock’s price from yesterday’s close to today’s current price (when the market is open), or to today’s closing price if after market close (4:00 PM EST).

Valuation & Timing

Fair Value – The current fair value price rating (credit: Morningstar.com)

% Fair Value – Calculates the percentage below or above the fair value estimate based on current market price. This column is then sorted by the most under-valued companies highlighted in descending order of green, light green, yellow to the over-valued companies highlighted in red.

52 Week Low – Stock’s lowest price reached during the past 52 weeks.

52 Week High Stock’s highest price reached during the past 52 weeks.

% L/H Range – Percent Low/High Range – This column lists the stocks current price as a percentage within its 52 week low and high range. When the stock price is within 15% of its 52 week low this indicator will turn green. I prefer to purchase stock when it is close to its 52 week low.

P/E – Price to Earning ratio. Ideally I want to purchase fair to under-valued companies when their price/earning ratio is below 22. However, not all companies and the industries they compete in fall into similar price/earning ranges, so I have some flexibility to investigate. Basically this criteria lowers my risk of purchasing over-valued companies.

After I find a company that meets the basic entry criteria on my watch list I then analyze the company in more depth. I find out more about its financial stability, and review its historical trends to make sure it is a company that I feel good about owning.

*Disclaimer: Information is provided “as is” and solely for informational purposes, not for trading purposes or advice. Sources may not always provide data. Quotes may be delayed up to 20 minutes.

Column Sources

Heading Source
Ticker David Fish, Dividend Champions spreadsheet
Sector David Fish, Dividend Champions spreadsheet
Annual Dividend Payment $ David Fish, Dividend Champions spreadsheet
# of Years Dividend Increase David Fish, Dividend Champions spreadsheet
MS Economic Moat Morningstar.com
Dividend Yield Formula: (Dividend payment / Current price)
5 Year Dividend Growth David Fish, Dividend Champions spreadsheet
Chowder Rule Y+DGR Formula: (Yield + 5 Year DGR)
Most Recent % Increase David Fish, Dividend Champions spreadsheet
Estimated 5-Yr Growth Rate David Fish, Dividend Champions spreadsheet
EPS % Payout David Fish, Dividend Champions spreadsheet
Debt to Equity David Fish, Dividend Champions spreadsheet
Current Price Google Finance
% Change Google Finance
MS Fair Value Morningstar.com
% Fair Value Formula: (Current Value / Fair Value)-1
52 Week Low Google Finance
52 Week High Google Finance
% > Low Formula: (Price-52 Week Low)/52 Week Low
P/E Google Finance

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