Tuesday, April 9, 2013

Conoco Phillips COP Dividend Machine for April 9, 2013

            In this post I will review the criteria I use to select a stock that I believe will provide reliable income; income that increases; and leads to finding a solid company.   Conoco Phillips, COP is a stock I will add to my 2013 dividend machine list.  Analysis of the dividend machine fundamentals of COP is provided below.

Easy to Find Criteria

Four Criteria

Dividend Yield
Three Percent
EPS greater than div.
Dividend Increases
Every year since at least 2007
Debt to Equity
D/E ratio 1 or less or industry standard

These four criteria are easy to find.   I search the WSJ, or TheStreet.com, or sometimes a tip from TV for stocks that are potential Dividend Machines.  

Often, I have to research 10 stocks to find one I like.   Next I begin to gather these four easy to find criteria using www.nasdaq.com and www.investing.money.msn.com.


Type in the stock symbol then click on “summary” on the left side of the page under “stock details.”  You will find the current price, the most recent four quarters of earnings (EPS), the annualized dividend, and the yield.  Next click on  “dividend history” on the left side of the page under “fundamentals” and you will see quarterly dividends displayed for up to about ten years.   You now have three of the four criteria.  

Note, that I often go to the website of the individual company to make sure the data are accurate.  However, I have found Nasdaq.com to be one of the more accurate websites for this kind of information.


This site provides easy to find debt to equity ratio.   Type in the stock symbol and you will see a summary similar to nasdaq.   If you scroll down, you find the debt to equity ratio of this company.    Now you have all four criteria to help you determine if the company you are considering for an income investment is truly a dividend machine.   

Conoco Phillips COP
Conoco Phillips
Price when profiled
Last 4 Qtrs Earnings
Last 4 Qtrs Dividends
Current Qtr Dividend
Annualized Div Yield
No. Years Div Increase
      since 2005
Debt/Equity ratio

Conoco Phillips is my selection for the next 2013 dividend machine.  Let’s look at the fundamentals.   Trading today around $59.84, COP pays a quarterly dividend of $.66 per share.  Annualize that dividend (4 times $.66) and you will received $2.64 per share.  That is a yield of 4.41%.  You beat the US treasury by 150% if you investment in COP[l1] .

COP earns a mighty $6.69 per share.  It is highly likely that COP will continue to be able to pay this dividend in the future.    Dividend history is solid.  COP has increased the dividend every year since 2005 which includes the very difficult period of 2008/2009.

Finally, for every dollar of equity, COP has only $.45 of debt.  This is a good, solid company.  See the table above and then decide if you too want to investment in this kind of dividend machine.