Friday, July 17, 2015

NOV is looking really good


Hello,


While waiting for fresh capital to come in for my regular investments, I did a quick criteria analysis on National-Oilwell Varco, Inc. (NOV).

NOV 7/2015AreaCriteriaCheckListComment
Quality Company
Dividend Growth>5 yearsYes6 Years
ROE/Op MarginStableYesStable
Long term Avg GrowthStableYesStable
FCF over DividendsYesYesFCF covers Dividends
M* MoatWide MoatNoNarrow
M* & S&P
Credit Rating
> BBB+YesA+
Cash to Debt & Interest Coverage, Debt to EquityCash Debt >1 or Interest Coverage > 5YesCash to Debt 0.71
Interest Coverage 34.41
Debt to Equity 22.2
M* & S&P Stars> 3 Stars for bothYesM* 5 Stars
S&P CapIQ 3 Stars
Payout Ratio<60%Yes35.00%
Dividend Growth
& Yield
Dividend Yield>3%Yes4.10%
Dividend Growth>5%Yes60.10%
Chowder>12%Yes64.20%
Valuation
Yield/Avg Yield>1.1Yes3.15
Dividend Yield Theory Mid PointBelow Mid PointYesMid Point 64.39
Low Point 40
P/E Below Mid PointYesMedian 13.28 Current 8.31
DRRM~10%YesAssuming 5.5% growth; projected return=11.26%
M* Estimate<M* estYesM* 66
S&P Estimate< S&P cap IQ estYesS&P Cap IQ 58

The only negatives are the short dividend history and the narrow moat.

I will probably initiate a new position soon.

D4S

2 comments:

  1. I agree D4S, we've been picking up shares throughout the past year and have managed to lower our cost basis each time. We don't have a full position in NOV so it is certainly looking attractive to us right now. If prices remain at these levels once we've had a chance to move some cash around we might pick up a few more shares soon.

    I believe Jason over at Dividend Mantra recently picked up some shares.

    Thanks for sharing. Best wishes! AFFJ

    ReplyDelete
  2. AFFJ,
    Thanks for visiting. I just bought 35 shares @ 42.7 earlier today. I will document my analysis from my notes soon. Take care!
    D4s

    ReplyDelete