This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

10 Best Dow Dividend Stocks for 2012

5. IBM

Liability Adjusted Cash Flow Yield: 4.6%

Dividend Yield: 1.66%

LACFY/10-Year Treasury Yield: 2.22

Return on Invested Capital: 43%

Warren Buffett recently announced that Berkshire Hathaway accumulated $10.7 billion worth of IBM stock -- a 5.5% stake in the company. Oddly, this news comes as IBM (IBM - Get Report) stock is reaching all-time highs.

It's hard to imagine IBM as anything but fairly-to-over valued, yet the numbers suggest that IBM is still one of the cheapest in the Dow. The company's 4.6% liability-adjusted cash flow yield is well in excess of the 10-year Treasury yield (and the 30-year bond for that matter). And at 43%, IBM's return on invested capital in downright spectacular.

If IBM can continue to grow cash flows, the stock will remain an attractive investment. As for the quality of IBM's cash flow, the tech giant has one of the most consistent free cash flow/net income ratios in the business (consistently hovering near 1.0).

7 of 12

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
CAT $84.60 1.58%
JNJ $100.21 0.63%
IBM $166.16 3.42%
MCD $96.18 1.37%
KO $40.66 0.89%


DOW 18,034.93 +208.63 1.17%
S&P 500 2,100.40 +19.22 0.92%
NASDAQ 4,994.6020 +62.7870 1.27%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs