Sunday, March 22, 2015

Count of Stocks By Yield

One Last Table

One problem I have been running into with my formula approach is there have not been that many stocks qualifying.  One issue may be that the market is extended, so it is tougher to yield 2.6%.  I thought it might be interesting to look at the count of stocks that yielded 2.6% or great by year (recall each year has 50 stocks per month, so 600 stocks per year, though not all unique) that have a market cap greater than 600m from the greater than 100m screen.

The results surprised me a bit:

Yield 2006 2007 2008 2009 2010 2011 2012 2013 2014
2.6% to 4% 18 15 28 19 16 45 76 95 72
4% to 6% 25 8 12 19 26 34 42 51 32
6% to 10% 23 25 10 13 9 7 12 16 12
over 10% 7 11 15 10 16 15 18 27 13
Grand Total 73 59 65 61 67 101 148 189 129

I was really surprised that 2013 was the peak year.  And only 59 stocks in 2007.  That does have some implications.  It means my back testing is based on a smaller sample size that I expected in the older years (only about 10% of total stock population).  I wondered if one issue was the "inflation" impact I mentioned before.  A 600m company in 2006 was "bigger" than a 600m company in 2013.  Then I also wondered if the low growth environment we are in has caused more companies to increase dividends rather than invest back into company.  So I am not really sure what to make of this although it does suggest my formula approach will continue to have duplication issues.


Joel said...

Interesting that from '06 there as been huge growth in the number of companies in the 2.6-4.0 range but next to no growth in the number of higher yielding companies of the next 3 levels (55 then, 57 now). Not sure what that means (those super high yields aren't sustainable?), but curious nonetheless. I wonder how many of those 55 remain in the count today? and what their total return would be since then (assuming reinvested dividends)

Marsh_Gerda said...

Joel, here are the stocks that make up that 55 count:


DLX has gone from $17 to $68.
ALJ has gone from $30 to $16
UST, PD, FDG have been bought out.
UNTD went through major changes.
PCU changed name and has gone from $8 to $30.
DK has gone from $12 to $38.
VFC has gone from $14 to $75
NUE is actually down a bit.
GMR is gone as is WON.

Joel said...

Wow, thanks for the info! VFC is the one that is most attractive to me - I've watched it for a while and I think their portfolio of brands is very strong. Never pulled the trigger though...Bummer their div yield is only 1.7% now, but I like how they've been using their cash over the years to invest in those brands.

Corpraider said...
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Corpraider said...

I'm probably being dense, but when you say 73 stocks in a year, is that 73 unique stocks or just 73 "rolls" if you will (i.e. if the same 5 stocks were generated by the formula all year I would have 60 (5 x 12) stocks for that year)?