But, as indicated before, I would like also the assurance that the stocks I purchase for minimal risk price appreciation plus dividends, in lieu of buying bonds or cash reserves, meet the low debt and low payout ratio tests. In addition, I want assets likely to do better than the average security.
So, I have selected from the Value Line A++ assets only those with: superior dividend growth rate; debt to equity .33 or below; payout ratio .5 or below; and a 3-5 year projected total return at least 25% higher than the average.
As best I can determine, only three stocks currently meet these criteria:
|Company||Symbol|| Recent Price|
|Home Depot|| HD||$39.85|
|Intel Corp|| INTC||$20.28|
|PepsiCo, Inc.|| PEP||$48.29|
Since this latter, more selective approach provides fewer stocks making the cut at any one time, for adequate diversification I would suggest running the screens quarterly and adding, each three months, securities that newly meet the standards. But as these are generally quite good quality assets with fine long-term prospects, in this strategy, all such assets would, in contrast to the O'Shaughnessy Core Value plan, not be sold annually but just after being held at least 3-5 years, if they then no longer meet the selection criteria.