Dividend Stocks Analysis Checklist

by | Investment Analysis

Dividend Stock Analysis Checklist

You will find the following dividend stocks analysis checklist to be broad in scope yet focused on the most important metrics. These are the metrics I have found which really matter for discovering, evaluating, and comparing dividend stocks for potential investment.

This analysis goes beyond more commonly used or popular metrics which might not be effective in the real world. There are some lesser known metrics which provide better indicators of future performance. We can use these to gain an advantage in analyzing dividend stocks.

The dividend stocks analysis checklist is divided into 4 sections: Company Analysis, Valuation, Earnings Quality, and Dividend Safety. 

Company Analysis Checklist: 

1. How does the company make money? Do I understand?; if not stop here.

2. What need is the company meeting? In other words, what is its story? 

3. Does the industry of the company fit into my desired asset allocation mix?

4. Does the company have sustainable competitive advantages? If not, we will require a much larger margin of safety than otherwise.

You will find each of the following metrics on the Arbor Investment Planner Website. In addition, I have provided links to most of these metrics for your convenience.

Dividend Stocks Valuation Analysis Checklist:

5.  What is the Free Cash Flow Yield ? 

6.  What is the Enterprise Value ?

7.  What are the Enterprise Value Ratios for the stock?         

EV / EBIT  (Earnings Before Interest & Taxes)

EV / EBITDA (Earnings Before Interest Taxes Depreciation & Amortization)           

EV / CFO (Cash From Operations)

8.  What is the Price to Sales Ratio?

9. What is the Earnings Yield  or PE Ratio (price to earnings ratio)?

10. What is the PE10 ?

11. What is the Operating Earnings Yield?

Earnings Quality Checklist:

12.  What is the Operating Income?

13. What is the Operating Income / Enterprise Value (a.k.a Acquirer’s Multiple)?

14. What is the company Gross Profits ?  What is the Total Assets?

15. What is the company’s Gross Profitability Ratio? (profitability and efficiency ratio)

         Calculation:  Gross Profits / Total Assets 

16. What is the company’s Return on Capital Ratios ? 

             – Cash Return on Invested Capital (CROIC)

             – Return on Invested Capital (ROIC)

17. What is the company’s Profit Margin (TTM)?:

18. What is the Piotroski F-Score?  (9 metrics)


Dividend Safety Analysis Checklist:

19.. What is the stock Price, Dividend Per Share, and Yield?

20. What are the Dividend Coverage Ratios?

       Calculation: Cash Flow From Operations Per Share / Dividends Per Share

Calculation: Free Cash Flow Per Share / Dividends Per Share

21. What is the Cash Dividend Payout Ratio ?

        Calculation: Common Stock Dividends / (Cash Flow from Operations – Capital Expenditures – Preferred Dividend Paid)

22. What is the  Cash Flow From Operations Per Share Dividend Coverage Ratio?

Calculation:  CFO Per Share / Dividend Per Share

23. What is the Free Cash Flow Per Share Dividend Coverage Ratio?

       Calculation:  FCF Per Share / Dividend Per Share

24.  What is the company Net Financial Debt?       

25.  What is the Market Capitalization?

26. What is the Net Financial Debt to Market Capitalization Ratio?

27.  What is the Net Financial Debt to EBITDA (TTM) Ratio?



This Dividend Stocks Analysis Checklist provides a great foundation for evaluating dividend stocks and comparing between different opportunities. 

An explanation on how I analyze for intrinsic value / margin of safety can be found at Selecting Dividend Stocks With the Dividend Value Builder.

Feel free to look through the Dividend Value Builder Content Page to discover, evaluate and compare individual dividend stocks without emotional bias.

Discover, Compare, and Evaluate Dividend Stocks Without Emotional Bias

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While Arbor Investment Planner has used reasonable efforts to obtain information from reliable sources, we make no representations or warranties as to the accuracy, reliability, or completeness of third-party information presented herein. The sole purpose of this analysis is information. Nothing presented herein is, or is intended to constitute investment advice. Consult your financial advisor before making investment decisions.

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