My Top 2 Dividend Stocks to Buy Now
When it comes to valuation, most investors fall back on things like the price-to-earnings (P/E) ratio. Earnings are too variable for me, so I prefer metrics like price-to-sales ratio and, my personal favorite, relative dividend yield. Right now the dividend yields on offer from Hormel Foods (NYSE: HRL) and Clorox (NYSE: CLX) are elevated and I think both stocks are worth buying. Here's why.
Hormel has increased its dividend annually for over 50 years, making it a Dividend King. Over the past decade its dividend has grown at an annualized clip of 14%. And today, its dividend yield is toward the high end of its historical yield range. While the 2.1% yield may sound anemic when looked at in isolation, that's clearly not the full story.
Image source: Getty Images.
Source Fool.com
