Investor Empowerment from Dow Dogs

McGraw Hill Financial, publisher of the Dow-Jones Industrial index, states:

“The Dow®, is a price-weighted measure of 30 U.S. blue-chip companies. The Dow® covers all industries with the exception of transportation and utilities, which are covered by the Dow Jones Transportation Average™ and Dow Jones Utility Average™.”

While stock selection is not governed by quantitative rules, a stock typically is added to The Dow® only if the company has an excellent reputation, demonstrates sustained growth and is of interest to a large number of investors. Maintaining adequate sector representation within the indices is also a consideration in the selection process.”

The Dow 30 Viewed Two Ways

Yield (dividend / price) results from indexArb.com and YCharts.com for 30 Dow industrial stocks as of market closing prices produce actionable conclusions.

Investors have utilized Michael B. O’Higgins dividend dog ranking system to select portfolios of five or ten stocks in the Dow Index to trade as of the last day in December since 1991, when he wrote the book “Beating The Dow” (HarperCollins). Thereafter dog investors awaited annual results from their investments in the lowest priced, highest yielding stocks and trusted that the price of every stock they now owned would climb higher (having locked in a high yield percentage at purchase).

Now named Dogs of the Dow. O’Higgins system works to find bargains in any collection of dividend paying stocks. Incorporating analyst price upside estimates into the dog analysis has expanded the dog stock selection process to include popular growth equities, if so desired.

Dog Metrics Clock S&P 500 Stocks by Yield

McGraw Hill Finance, publisher of the Dow Jones S&P 500 Index states:

“The S&P 500® is widely regarded as the best single gauge of large cap U.S. equities. There is over USD 5.58 trillion benchmarked to the index, with index assets comprising approximately USD 1.3 trillion of this total. The index includes 500 leading companies and captures approximately 80% coverage of available market capitalization.”

Dog Metrics Gauge 50 S&P Aristocrats by Yield

McGraw Hill, publisher of the Aristocrat index, states:

“The S&P 500® Dividend Aristocrats index measures the performance of large cap, blue chip companies within the S&P 500 that have followed a policy of increasing dividends every year for at least 25 consecutive years.”

Dog Metrics Parse NASDAQ Stocks by Yield

NASDAQ states:

“The NASDAQ-100 Index includes 100 of the largest domestic and international non-financial securities listed on The Nasdaq Stock Market based on market capitalization. The Index reflects companies across major industry groups including computer hardware and software, telecommunications, retail/wholesale trade and biotechnology. It does not contain securities of financial companies including investment companies.”

Dog Metrics Cast Russell 1000 & 2000 Stocks by Yield

FTSE Russell states:

“The Russell Indexes are a family of global equity indices that allow investors to track the performance of distinct market segments worldwide.”
“Using a rules-based and transparent process, Russell forms its indexes by listing all companies in descending order by market capitalization adjusted for float, which is the actual number of shares available for trading. In the United States, the top 3,000 stocks (those of the 3,000 largest companies) make up the broad-market Russell 3000 Index. The top 1,000 of those companies make up the large-cap Russell 1000 Index, and the bottom 2,000 (the smallest companies) make up the small-cap Russell 2000 Index.”

Dog Metrics Compare 50 Champion Stocks by Yield

David Fish’s Champions list (from here) contains stocks distinguished as having paid increasing dividends for 25 years or longer.

The U.S. Dividend Champions are maintained by Dave Fish of Moneypaper’s DirectInvesting.com, whose articles appear at Seeking Alpha. Dividend Champions Screener by Peter Gormsen.

Dog Metrics Sort 50 Contender Stocks by Yield

David Fish’s Contenders list (from here) pays increasing dividends for 10 to 24 years. Contender stocks as rated by yield revealed the top ten. Price data and annual dividend calculations come from dripinvesting.org.

Dog Metrics Define 50 Leading Challenger Dogs by Yield

David Fish’s August 31 Challengers list contains stocks distinguished by paying increasing dividends for 5 to 9 straight years. These, ranked by yields reveal the top ten.

Dog Metrics Found Global 50 Stocks by Yield

Using my YCharts dashboard I sort a list of companies not based in the US or Canada with market capitalization greater than $200 million, share price greater than $5 dividend yield greater than 4% and 30 day average daily volume greater than 200,000 shares. This results in a list of approximately 70 strong global candidates.

Industry Yield Leaders Really Bad?

These are not the worst of the worst. These are “Bad-As” stocks with high yields. My list of fifty bad dogs is created by screening for industries populated by public companies that have allegedly committed acts, made substances, by-products, or devices that maim, kill, tempt, harm, addict, insult, and/or scam the public. These include corporate members of all nine (now 11) business sectors: basic materials, consumer goods, financial, technology, conglomerates, health, services, utilities & industrial goods. Sorting and refining top stocks in each industry of interest by yield narrowed the field (by yield) to fifty from over 1000 candidates. They may be bad but they all pay strong dividends!

Finding Sector Leaders

Eleven Morningstar business sectors in (alpha order) are: basic materials, communication services, consumer cyclicals, consumer defensive, energy, financial services, healthcare, industrials, real estate, technology, and utilities. Yield (dividend / price) results from here verified by Yahoo Finance for sector leading stocks as of market closing prices reveal the actionable conclusions enumerated in each article.

Indexes