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Zacks.com Featured Highlights: Tyson Foods, Lear, Torchmark, Lexington Realty Trust And DTE Energy

Published 06/20/2016, 09:30 PM
Updated 07/09/2023, 06:31 AM
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For Immediate Release

Chicago, IL – June 21, 2016 - Stocks in this week’s article include: Tyson Foods Inc (NYSE:TSN). (TSN), Lear Corporation (LEA), Torchmark Corporation (NYSE:TMK) (TMK), Lexington Realty Trust ( LXP) and DTE Energy Company (NYSE:DTE) (DTE).

Screen of the Week of Zacks Investment Research:

5 Solid Dividend Growth Stocks to Counter Choppy Markets

No doubt, dividends are always the major sources of consistent income for investors when returns from price movements of stocks are at risk. In particular, stocks that have a strong history of dividend growth as opposed to those that pays high yields form a healthy portfolio with more scope for capital appreciation.

Why Dividend Growth?

Stocks that have a history of enhancing shareholder returns generally act as a hedge against economic uncertainty or stock market volatility.

Additionally, these stocks have superior fundamentals compared to other dividend paying stocks as dividend growth poses a sustainable business model, a long track of profitability, rising cash flows, good liquidity, a strong balance sheet and some value characteristics. All these make dividend growth a promising investment amid market turbulence.

Further, these are proven outperformers over the long term despite the fact that they do not necessarily have the highest yields.

Hence, to find stocks with a solid dividend growth history, we have focused on 5-Year Historical Dividend Growth of more than zero. The combination of this metric with other exciting parameters could result in a winning portfolio:

Other Parameters:

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 in the future even in 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.

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 3: Stocks having a Zacks Rank #1 (Strong Buy), 2 (Buy) and 3 (Hold) 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 five of the 16 stocks that fit the bill:

Tyson Foods Inc. (TSN) : This Arkansas-based company is one of the world’s largest producers of chicken, beef, pork and prepared foods, offering a wide range of protein-based and prepared food products. It saw positive earnings estimate revisions of a couple of cents for fiscal 2016 over the past 30 days, with an expected above-average growth rate of 37.54%. The stock has a Zacks Rank #2 and a VGM Style Score of A.

Lear Corporation (LEA) : This Michigan-based company is a global leader in designing, developing, engineering, manufacturing, assembling, and supplying automotive seating, electrical distribution systems, and related components primarily to automotive original equipment manufacturers worldwide. The stock has an above-industry earnings growth rate of 19.69% for this year. It has a Zacks Rank #1 and a VGM Style Score of A.

Torchmark Corporation (TMK) : This is a Texas-based financial services holding company specializing in life and supplemental health insurance for middle-income Americans. Its earnings are expected to growth at rate of 5.46% for this year. The stock has a Zacks Rank #3 and a VGM Style Score of A.

Lexington Realty Trust (LXP) : This New York City-based company is a real estate investment trust engaged in the ownership, operation and management of a diverse portfolio of real properties. The stock saw earnings estimate revision of a penny for this year over the past 30 days and delivered a positive earnings surprise of 7.59% over the past four quarters. It has a Zacks Rank #3 and a VGM Style Score of B.

DTE Energy Company (DTE) : This Michigan-based company is a diversified energy company involved in the development and management of energy-related businesses and services nationwide. Its earnings are expected to growth at rate of 2.70% for this year. The stock has a Zacks Rank #2 and a VGM Style Score of B.

You can get the rest of the stocks on this list by signing up now for your 2-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 .

Zacks Restaurant Recommendations: In addition to dining at these special places, you can feast on their stock shares. A Zacks Special Report spotlights 5 recent IPOs to watch plus 2 stocks that offer immediate promise in a booming sector. Download it free »

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

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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.



TYSON FOODS A (TSN): Free Stock Analysis Report

LEAR CORPORATN (LEA): Free Stock Analysis Report

TORCHMARK CORP (TMK): Free Stock Analysis Report

LEXINGTON PPTY (LXP): Free Stock Analysis Report

DTE ENERGY CO (DTE): Free Stock Analysis Report

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