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Zacks.com Featured Highlights: Nu Skin Enterprises, Papa John's, Steel Dynamics, Masco And MB Financial

Published 08/07/2016, 09:30 PM
Updated 07/09/2023, 06:31 AM

For Immediate Release

Chicago, IL – August 08, 2016 - Stocks in this week’s article include: Nu Skin Enterprises Inc. (NUS), Papa John's International Inc. (PZZA), Steel Dynamics Inc. (STLD), Masco Corporation (NYSE:MAS) ( MAS) and MB Financial Inc. (MBFI).

Screen of the Week of Zacks Investment Research:

5 Dividend Growth Stocks to Play It Safe

With 2016 being dominated by volatility, it’s not surprising that dividend investing has emerged as one of the most popular investing strategies. Dividends are major sources of consistent income for investors when returns from price movements of stocks are at risk.

Benefit of Dividend Growth

There are multiple styles of dividend investing out of which dividend growth is the most appealing. Stocks with dividend growth generally outperform their peers and generate increased profits year after year. Thus, the dividend growth strategy has an edge over the steady dividend strategy. By investing in stocks with dividend growth, investors can enjoy rising current income while awaiting capital appreciation.

Dividend growth stocks also provide some margin of safety, which enables investors to withstand shocks. In fact, stocks that have a strong history of dividend growth as opposed to those that have high yields form a healthy portfolio.

Moreover, these stocks often have superior fundamentals compared to other dividend paying stocks. This is because dividend growth is often an outcome of a sustainable business model, a long track record of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics.

Here are the screening parameters that could result in a winning dividend growth portfolio:

5-Year Historical Dividend Growth greater than zero: This selects stocks with a solid dividend growth history.

Most Recent Payout Ratio less than M-Industry: This is the measure of dividend payments as a percentage of earnings. A relatively low payout ratio indicates the company’s ability to increase dividend even during tough times.

5-Year Historical Sales Growth greater than zero: This selects stocks with a strong record of revenue growth.

5-Year Historical EPS Growth greater than zero: This shortlists stocks with a solid earnings growth history.

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Next 3–5 Year EPS Growth Rate greater than zero: This represents the rate at which a company’s earnings are expected to grow. Improving earnings should help companies sustain dividend payments.

52-Week Price Change greater than S&P 500 (Median): This ensures that the stock appreciated more than the S&P 500 over the past one year.

Zacks Rank Less than or Equal to 2: Stocks having a Zacks Rank #1 (Strong Buy) or 2 (Buy) generally perform better than their peers in all types of market environment.

VGM Style Score of B or better: This is simply a weighted combination of Value, Growth and Momentum.

Market Capitalization greater than $2 billion: We have eliminated small-cap stocks to ensure better flexibility and tradability.

Here are 5 of the 15 stocks that fit the bill:

Nu Skin Enterprises Inc. (NUS) offers a comprehensive line of premium-quality beauty and wellness products in more than 50 markets globally. Its earnings are expected to grow at a rate of 6.2% over the next 5 years. This Zacks Rank #2 company has a VGM Style Score of B.

Papa John's International Inc. (PZZA) is the world’s third-largest pizza delivery company. The stock has a Zacks Rank #2 and a VGM Style Score of B. It also has an average four-quarter EPS surprise of 7.8%.

Steel Dynamics Inc. (STLD) is one of the largest steel producers and metals recyclers in the U.S. Its earnings are expected to grow at a rate of 30% over the next five years, much above the industry average of 8.9%. The stock has a Zacks Rank #2 and a VGM Style Score of A.

Masco Corporation (MAS) is a leading manufacturers of branded home improvement and building products globally. The stock has delivered a positive average earnings surprise of 14.7% over the past four quarters. It has a Zacks Rank #2 and a VGM Style Score of A.

MB Financial Inc. (MBFI) is a holding company for MB Financial Bank, N.A. with assets of approximately $15.6 billion. Its earnings are expected to grow at a rate of 10.5% over the next five years. The stock has a Zacks Rank #2 and a VGM Style Score of A.

You can get the rest of the stocks on this list by signing up now for your two-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

Click here to sign up for a free trial to the Research Wizard today .

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

Disclosure: Performance information for Zacks’ portfolios and strategies are available at:
https://www.zacks.com/performance .

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Sign up now for your free trial today and start picking better stocks immediately. And with the backtesting feature, you can test your ideas to see how you can improve your trading in both up markets and down markets. Don’t wait for the market to get better before you decide to do better. Start learning how to be a better trader today: https://at.zacks.com/?id=111

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

About Screen of the Week

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here https://at.zacks.com/?id=112

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Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros.

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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer .

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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NU SKIN ENTERP (NUS): Free Stock Analysis Report

PAPA JOHNS INTL (PZZA): Free Stock Analysis Report

STEEL DYNAMICS (STLD): Free Stock Analysis Report

MASCO (MAS): Free Stock Analysis Report

MB FINANCL INC (MBFI): Free Stock Analysis Report

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