My High Dividend Stocks Blog http://myhighdividendstocks.posterous.com Most recent posts at My High Dividend Stocks Blog posterous.com Thu, 11 Aug 2011 15:54:58 -0700 Total (TOT) is a high dividend stock now, but wait for oil to bottom before purchase. http://myhighdividendstocks.posterous.com/total-tot-is-a-high-dividend-stock-now-but-wa http://myhighdividendstocks.posterous.com/total-tot-is-a-high-dividend-stock-now-but-wa

Total (TOT) is now a high dividend stock thanks to the recent worldwide stock market crash and oil’s price plunge.  Total peaked back in May 2011 at $64.44.  The stock has fallen 27.9% since May to $46.42 today.  I wrote an article on June 23rd, 2011 on Total that had all my typical measurements of dividend record, earning power, and strength of balance sheet metrics.  Here is a quick recap: today’s dividend yield is 6.9% and is relatively safe, it earned an average of $4.64 per share (adjusted) over the past five years making it a value below $55.68, and it has a good balance sheet.

Click here for the June 23rd article: http://www.myhighdividendstocks.com/stocks-that-pay-small-dividends/which-integrated-oil-majors-will-become-high-dividend-stocks

This stock is a buy for its combined high dividend, earning power, and strong balance sheet.  But the fundamentals of oil are short term bearish.  The global economy never really recovered since the Panic of 2008.  Keynesian money printing and massive government deficits have only made things worse.  When worldwide investors slowly realize that there is no recovery the price of oil will tank.  Total will be dragged down by the drop in oil.  The dividend yield will become bigger as its stock price declines.  I think that Total could drop all the way back down to $36.82 like it did during the Panic of 2008 especially if oil drops to the $40-$50 range per barrel.

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Link to this chart: http://stockcharts.com/h-sc/ui?s=TOT&p=W&b=5&g=0&id=p26097042894

Look at oil’s hammering.  Oil’s fundamentals trump Total’s.  Wait to buy until oil is done going down.  Put Total (TOT) on your watchlist.

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Disclosure: I don’t own Total (TOT) yet.

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Thu, 23 Jun 2011 22:39:56 -0700 Which integrated oil majors will become high dividend stocks? http://myhighdividendstocks.posterous.com/which-integrated-oil-majors-will-become-high http://myhighdividendstocks.posterous.com/which-integrated-oil-majors-will-become-high
Total_balance_sheet_2006_2010

Today's new about the US government planning to sell 2 million barrels of oil per day for 30 day from the strategic oil reserve got me thinking about which oil majors are high dividend stocks?  The answer is none.  But some itegrated oil majors are close in the 4-5% dividend yield range.  A significant stock market correction could make some of the high dividend stocks yielding over 6%.
 
Exxon Mobil (XOM) yields 2.40%
Cheveron (CVX) yields 3.14%
Royal Dutch Shell (RDS) yields 4.90%
Total (TOT) yields 5.76%
BP (BP) yields 3.95%
Petroleo Brasilero (PBR) yields 4.47%
Conoco Phillips (COP) yields 3.62%
 
If the US government is temporarily successful at increasing the US domestic supply of oil, then oil prices should fall in the short term.  This in turn will drive the oil stocks lower.  That will drive oil stock dividend yields higher and it might possibly provide some attractive buying opportunities for price appreciation once the effects of the governments actions wear off.
 
I'm going to start by examining the highest dividend stock on this short list: Total (TOT).
 
Total (TOT)
Market price: $54.70
Shares: 2.35 billion
Dividend: $1.61 semi annual
Dividen yield: 5.76%
Recent EPS: $7.60
Dividend payout ratio: 84.7% (that sort of high, but tolerable)
 
Earning power: $4.64 average earnings over five years @ 2.35 billion shares
(Earnings adjusted for changes in capitalization - slight increase in shares)
          EPS      Net inc.          Adj. EPS
2006   $5.09     $11,788 M     $5.01
2007   $5.80     $13,181 M     $5.61
2008   $4.71     $10,590 M     $4.51
2009   $3.78     $8,447 M       $3.59
2010   $4.71     $10,571 M     $4.50
Five year average adjusted earnings = $4.64 per share
Market price is at 11.78 times average earnings.  Total appears to be value priced right now.
Value territory starts at or below 12 times average earnings = $55.68
Speculative pricing is at or above 20 times average earnings = $92.80
 
Balance sheet strength:
Book value per share: $27.84
Price to book value ratio: 1.964 (good)
Current ratio: 1.40 (over 2.0 is good)
Quick ratio: 0.87 (over 1.0 is good)
 
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http://files.posterous.com/user_profile_pics/697493/v_for_vendetta_guy_fawkes_mask11.jpg http://posterous.com/users/4wuf4tt8LZzb Jason Brizic myhighdividendstocks Jason Brizic