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16 Income Growth Stocks With A PEG Below One

With the stock market in nearly nonstop rally mode over the past six years, investors haven't needed to look far to uncover an abundance of growth stocks. 

But not all growth stocks are created equal: While some could still deliver extraordinary gains, others appear considerably overvalued, and might instead burden investors with hefty losses. 

What exactly is a growth stock? Though it's arbitrary, I'll define a growth stock as any company forecast to grow profits by 10% or more annually during the next five years. To decide what's "cheap," I'll use the PEG ratio, which compares a company's price-to-earnings ratio to its future growth rate. 

Any figure around or below one could signal a cheap stock. Attached you can find a list of dividend growth stocks with a history of consecutive dividend hikes of more than 5 years and a PEG ratio below one. 

Each stock from the list is a Midcap with a market cap over 2 billion. I've tried to exclude all lower capitalized stocks out of the screen in order to keep the big risks away.

In total, there are 16 companies from my high quality dividend stock screen that fulfilled my criteria.

Here is the list of stocks with a PEG ratio below one....

10 Well Diversified Dividend Stocks For Retiree Portfolios

Safety and predictability are great to have when planning for retirement. However, today’s retirees are more challenged than ever to conservatively produce safe income from dividend stocks. 

Interest rates are near rock bottom, valuations are running high relative to history and a rate increase from the Federal Reserve could be right around the corner.

Furthermore, many dividend-paying stocks have seen their yields compress over the last few years as investors stampeded into anything with yield. With the economy’s slow growth, dividend growth has also begun to wane.

We set out to find some exceptional dividend stocks that are solid choices for current dividend income and income growth in retirement portfolios. With starting dividend yields between 2% and 5%, this group of blue-chip dividend stocks offers a good balance of safety, yield and growth.

Here is a group of 10 dividend stocks that currently have good yields (3% or greater), and dividend stocks that don’t necessarily have great yield but have excellent dividend growth.

These are the results...

My 10 Favorite Dividend Stocks To Buy And Hold For The Next Decade

Buy and hold stocks are definitely underrated. Some investors spend copious amounts of time tracking their investments and hoping their value increase.

Then there are dividend investors. Sure, they like watching the value of their stocks rise, but they also like getting free money every three months—money they can either cash or reinvest.

Dividend investing might not be as exciting as trying to find the latest tech stock that is about to soar, but that’s because dividend investing is a long-term sport for patient investors. Dividends are typically paid out by larger, well-established companies and have become increasingly popular in the current near-record-low interest rate environment.

After all, it’s easier to have your money work for you when you invest in a company that provides an annual dividend of four percent and has a long history of increasing its annual dividend than, say, putting your money in the bank or bonds, where the yields are virtually zero.

Dividends are typically by companies that make a lot of money, but don’t need all of the cash to fund growth. Instead of reinvesting all of their money into the company, they pay some of it out to shareholders.

If you’re looking at adding dividend growth stocks to your portfolio, pay particular attention to the price/book (P/B), price/earnings (P/E), return on equity (ROE), payout ratio, and levered free cash flow.

Also, look for stocks with a high barrier to entry. This prevents other companies from entering the fray and taking a bite out of profit margins, which keeps the company making money and the dividend yield safe.

Here are my top 10 stocks to buy and hold for the next decade...

4 Great Stocks Trading At Less Than 10-Times Free Cash Flow

Dividend growth stocks deserve a place in your portfolio, no matter how modest the allocation, simply because they often return 100% to 200% or better relatively quickly as their payouts rise.

You’ve probably noticed you rarely see your favorite stock paying more than 2% or 3%, even if the company raises its dividend every year.

That’s because its price gets bid up as its payout rises – so you never quite get the bargain 4% yield you’re always waiting for, unless something really bad happens (like 2008).

Here are four stocks from my watch list trading at less than 10-times free cash flow. All are growing their payouts quickly AND reducing their share counts meaningfully – a bullish sign of things to come:

Dividend Aristocrats With The Lowest Price To Book (P/B) Ratio

We have seen that simple value strategies tend to outperform. This has been the case with each one we have looked at so far, including the P/E ratio and its alternatives. 

Today's article will change that trend. Normally there would not be much point in writing an article about what doesn't work. 

But this particular ratio is one of the most frequently reported and used, so I think it's worth discussing. 

 The price to book (P/B) ratio is defined as: P/B = Market Cap / Book Value The low P/B strategy buys companies that are trading at the largest discounts to their net asset values.

Today I will share the 20 cheapest Dividend Aristocrats by P/B ratio with you. 

Here are the results...