An article titled, "Goldman's 10 Stocks for Dividend Growth", written by David Hunkar and posted on Seekingalpha.com. We ran the stocks through our model, the results are below. For the most part we are familiar with these stocks. MMM was "my" stock in business school and one I have admired it ever since, guess I do love boring. Overall, the risk profile of most of the stocks looks good. We have previously posted analysis on ADI, BAX and CTL, see the dates listed adjacent on the stock listings.
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As with everything we post, we may or may not have the stock and/or strategy in place in any one of our portfolios or may add it at any time.
ADI - Analog Devices, Inc (09/14/10) - Overall the metrics look good. There is little difference on the Oct v Nov calls and would opt for the Nov as it represents less trading and expense.
BAX - Baxter International, Inc - The P/E is a little high but the RVI's are low. The best value is in the near dated option, by 0.01%/day. Note the difference in the strike prices.
BMY - Bristol-Myers Squibb Company - Either date captures the dividend, the low P/E's are offset by the high RVI's. Like BAX, the daily difference in earning is 0.01%/day.
CTL - CenturyLink Inc (09/13/10) - Like BMY, the low P/E's are offset by the high RVI's. Although in this case the daily difference in earning is 0.001%/day.
HAS - Hasbro, Inc - Either date captures the dividend, the low P/E's are offset by the high RVI's. Like BAX, etc., the daily difference in earning is 0.011%/day. Note the different strike prices with the near date being "in the money".
HD - Home Depot, Inc - Either date captures the dividend. Even with a lower SSR, the near date offers the best return profile. The RVI's are fair all around.
KLAC - KLA-Tencor Corporation - The P/E is 26.72 while the RIV's are fair value..... The SSR's are great and either options covers the dividend with the near date earning a whopping 0.132%/day. The forward P/E is 8.5, but I'm struggling with the 26.72.
MMM - Minnesota Mining & Minerals - 3M Company - What is not to love about 3M? The RVI's are high, but either option covers the payment and the near date daily earning is 0.01% more than the far date.
T - AT&T (09/13/10) - We have an inherent fear of telco's although we did look at T on 9/13. The RVI's are high and the reward is limited with our strategy.
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