Dividend Stock Wednesday: Anheuser-Busch (BUD)
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This is an analysis completed by The Dividend Guy. It is not to be used as investment advice or a recommendation to buy, hold, or sell any stocks discussed. Please ensure you complete your own analysis.
In last week’s Weekly Roundup, I wrote about an article published in Business Week that listed stocks that were part of the Dividend Aristocrats that their analysts rated as a 4 or 5 out of 5. On the list was Anheuser-Busch (BUD), which is a stock that typically has done well in recessions. As there has been a lot of talk about recessions in the past few weeks, I thought it would be a good stock to look at.
The Company: Anheuser-Busch (BUD-NYSE)
Anheuser-Busch Companies is the holding company parent of Anheuser-Busch, Incorporated and to a number of subsidiaries that conduct various other business operations. The company’s operations are comprised of the following business segments: domestic beer, international beer, entertainment, packaging, such as aluminum beverage container recycling, malt production, rice milling, real estate development, turf farming, metalized paper label printing and transportation services.
| Yes | |
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THE FUNDAMENTALS
Revenue
Click to EnlargeRevenue Scoring
| Criteria | Scoring |
| Consistenly Up with No Down Years | 1.0 |
| Up Trend with < 2 Down Years | 0.5 |
| Choppy with > 2 Down Years | 0.0 |
| My Revenue Score | 0.5 |
Earnings Per Share
Click to EnlargeEarnings Per Share Scoring
| Criteria | Scoring |
| Consistenly Up with No Down Years | 1.0 |
| Up Trend with < 2 Down Years | 0.5 |
| Choppy with > 2 Down Years | 0.0 |
| My EPS Score | 0.5 |
TOTAL FUNDAMENTALS SCORE: 1.0
THE RATIOS
Return on Equity
Click to EnlargeReturn on Equity Scoring
| Criteria | Scoring |
| Above 15% for Last 5 Years | 1.0 |
| At Least One Year Below 15% in Last 5 Years | 0.0 |
| My ROE Score | 1.0 |
Other Ratios
| Ratio | Criteria | Value | Score (Pass=1 / Fail = 0) |
| Debt to Equity | < 0.50 | 2.36 | 0.0 |
| Payout Ratio | < 60% | 45% | 1.0 |
| Credit Rating | > BBB+ | A | 1.0 |
| Total Ratio Score | 2.0 |
TOTAL RATIOS SCORE: 3.0
DIVIDEND DATA
Annual Dividends
Click to EnlargeDividend Scoring
| Criteria | Scoring |
| 25+ Years of Dividend Growth | 1.0 |
| 10+ Years of Dividend Growth | 1.0 |
| < 10 Years of Dividend Growth | 0.0 |
| My Dividend Growth Score | 2.0 |
TOTAL DIVIDEND GROWTH SCORE: 2.0
STOCK VALUATION
| Valuation Metric | Criteria | Value | Score (Pass=1 / Fail = 0) |
| Dividend Yield | Cur Yld > 10 Yr Avg Yld | 1.9% | 1.0 |
| Div Yld Compared to SPY Div Yld | Cur Yld > SPY Yld | 2.3% | 0.0 |
| P/E Ratio | Cur P/E < 10 Yr Avg P/E | 20.8 | 1.0 |
| Relative P/E | Relative P/E < 1.0 | 0.88 | 1.0 |
| Price to Sales | < 1.5 | 2.11 | 0.0 |
| Total Ratio Score | 3.0 |
Canadian Shareowner’s Association Stock Selection Guide Software Buy Price
| Buy Zone |
Maybe Zone |
Sell Zone |
Current Price | Rating | Scoring (Buy=1.0, Other=0.0) |
| 0.0 |
TOTAL STOCK VALUATION SCORE: 4.0
SUMMARY
Points Earned:
9 out of 14
The stock is rated MEDIUM with 9 points earned through my analysis of the stock. I do not currently own BUD, but would not be interested in making a purchase at this time. I will want to see earnings increase. The consistent dividend increases are nice, but it appears that this is already priced into the stock
| Rating | Points Required |
| High | 11+ points |
| Medium | 8-10 points |
| Low | < 8 points |
Reminder: This is an analysis completed by The Dividend Guy. It is not to be used as investment advice or a recommendation to buy, hold, or sell any stocks discussed. Please ensure you complete your own analysis.
The Dividend Guy does not own shares in Anheuser-Busch (BUD)
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