One of the classic financial ratios is the price-to-earnings ratio , or P/E, which is the price of the stock divided by the earnings per share. The lower the P/E, the better.

The average P/E for the Dow Jones Industrial Average is 16.7. If you look at the companies that raised their dividends last week, nine of them had P/E's that were lower than the Dow's P/E. has reviewed the stocks that increased their dividends, and compiled the ones with the lowest P/E ratios.

Cincinnati Financial ( CINF) sits atop the list with the lowest P/E: 9. Cincinnati Financial is an insurance company that offers commercial and personal property insurance, casualty insurance and life insurance.

It just increased its dividend by 6%, yielding 3.6%. This is the 47th consecutive increase of the dividend. The stock carries a 1.2 P/E-to-growth (PEG) ratio. This Ohio-based company, which currently operates in 33 states, has recently decided to expand to New Mexico.

Cincinnati Financial shows up in the portfolio of the 5-Star Morningstar-rated Allegiant Mid Cap Value I Fund Arvix, which is managed by Michael Santelli. The fund has had an average annual return of 24.25% over the last three years. Allegiant also owns Edison International ( EIX), the electric utility that serves central and southern California. Edison has a P/E of 15, a PEG of 1.9 and a yield of 2.2%.

Another stock with a low P/E and an increasing dividend is Parker-Hannifin ( PH), which manufactures electromechanical controls and hydraulic-fluid power systems. It just increased its dividend by more than 21%, to 31.5 cents a share. The stock has a P/E ratio of 13.5, a PEG of 1.1 and a yield of 1.1%. It also just announced a $500 million stock repurchase, which is in addition to its existing share-repurchase program. To round out the good news, Parker-Hannifin plans a 3-for-2 stock split.

Parker-Hannifin appears in the Cramer's Machinery Stocks portfolio at Stockpickr. Another stock that appears on the list is Deere ( DE), the tractor- and farm-equipment company, which has a P/E ratio of 17, a PEG of 1.7 and a yield of 1.5%.

Another stock on the Cramer machinery list is Ingersoll Rand ( IR), a manufacturer of climate-control, construction, industrial and security products. Ingersoll has a P/E ratio of 9, a PEG of 1.2 and a yield of 1.5%. It just sold its Bobcat machinery division at a much higher price than anticipated.

Getting back to the stocks with low P/E's and dividend increases, The Andersons ( ANDE) shows up with a gigantic 63% increase in its dividend. This agriculture and transportation company has a P/E of 14, a PEG of 2.5 and a yield of 0.4%.

Andersons is part of the Ethanol Stocks portfolio at Stockpickr, which also includes Archer Daniels Midland ( ADM) with a P/E of 13 and a yield of 1.4%, and MGP Ingredients ( MGPI), with a P/E of 10 and a yield of 1.3%.

You can see the complete list of 12 stocks with the lowest P/E ratios that increased their dividends at Stockpickr.
At the time of publication, Altucher and/or his fund had no positions in the stocks mentioned, although positions may change at any time.

James Altucher is president of Stockpickr LLC, a wholly owned subsidiary of and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs a fund of hedge funds. He is also a weekly columnist for The Financial Times and the author of Trade Like a Hedge Fund, Trade Like Warren Buffett and SuperCa$h. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback; click here to send him an email. has a revenue-sharing relationship with Trader's Library under which it receives a portion of the revenue from purchases by customers directed there from