When it comes to investing in the current economic environment we have to consider the worst case scenario. Below I have included a spreadsheet that considers Dividend Achievers that are close to or within 10% of the 1 year low. These stocks are ideal for consideration as your next research and potential purchase candidates.
What I have done is assume the period which these stocks have accrued the lowest quarterly earnings since the recession began then projected those low earnings to determine if the company can sustain the dividend payment over the coming months and years. Stocks that have a negative number in the column titled "cash remaining" are the least likely to be able to increase their dividend in the coming year. While this does not condemn the stock it does warns us of the danger that might exist. Also, stocks that are highlighted in red are those whose lowest quarterly earnings since 2006, if projected into the future, could not sustain the current dividend payout. These stocks (DBD, PII, KO, PPG, TRH, UVV) are still good companies however, if the recession continues or gets worse then we could see the dividend increase put on hold as well.
My recommendation is that stocks with the lowest payout ratio and the highest cash remaining (based on the lowest quarterly earnings since the recession began) are the best companies to start your research. Don't forget to verify the dividend history before buying these stocks. Touc.
