Buy these dividend champions now while they’re cheap

The panic which spread through the market during the first half of October has subsided, and markets are once again charging higher as we head into the holiday season.

With the markets once again sitting just below their highs for the year, it comes as no surprise that many stocks are also hitting new 52-week or all-time highs. A lot of investors tend to shy away from investing in stocks when the markets are at highs, but you have to mentally separate a stock's price from a stock's value. In some cases you will find stocks near their 52-week lows are not attractive buys, while other times you will find stocks hitting new highs with low and attractive valuations.

There are multiple ways to gauge a stock's value, but the most widely accepted measure is the price-to-earnings ratio. Generally speaking, when a stock is trading at 15 times earnings or less, it is considered to be a good buy. Those are the stocks we want to focus on this week.

In addition to seeking out stocks with attractive valuations, we want to couple that screen with a screen for dividend champions. We will look for stocks with long streaks of dividend increases.

Combining these two screens we can come up with a nice list of dividend champions that you can buy on the cheap. In some cases, these stocks are trading near record highs, but don't let that fool you into thinking they are overpriced. Each has a very attractive valuation which indicates additional upside potential.

Michael Fowlkes

Michael Fowlkes

Michael Fowlkes is a financial writer who has been with the Fresh Brewed Media family since 2004. Over the course of his tenure with Fresh Brewed Media, he has worn many hats, including portfolio manager, options analyst, and writer. Michael received his undergraduate degree from Virginia Tech in Accounting and got his start in finance working as a stock trader for six years at Chase Investment Counsel in Charlottesville, Va.

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