This blog recommends how you can use the many things in your life to invest. Once you have the ideas down, you will need to do homework and today’s information can help. Tiffana Paulrajah at Inovestor Inc used the her data base to come up with some companies for you to play defense by. At the same time, the company’s dividends and growth rates help give you a consistent return on your investment for low risk.

Her criteria was to start with the S&P 500

a) Dividend Yield of at least 3%. (the chart was down at the end of Feb)

b) An economic performance index or EPI (Return on Capital divided by the Cost of Capital) above 1.

c) Return on capital equal to or greater than 10%.

d) Beta of less than one.

e) Positive earnings-per-share growth rate

f) An economic value-added (EVA) figure that is positive. For investors the higher the better.

g) Positive free-cash-flow-to-capital.

Company                 R/C        EVA per   EPS Growth    FCF/     EPS   Mkt Cap    Beta  Dividend

%             Share        Rate %       Capital %         (US $ Bil)              Yield %

Altria                      24.9         n/a              5.3                  9.6        3.2       127.114   0.65       3.6

L Brands                20.9         3.8               3.3                  3.8        3.2          22.794  0.65        5.6

Campbell Soup     20.3          2.7              3.5                  8.6        3.2           16.638  0.4          3.0

Verizon Comm      17.6         5.3              7.4                  3.9         2.8      402.088    0.56         4.4

Kellogg                    16.4         4.3              3.7                  7.6        2.5           33.945  0.53        3.1

Public Storage        14.8       4.6               6.8                  15.0      2.1            38.423  0.46        3.8

AT&T                        12.2        3.5              4.8                    5.2      2.1        455.956    0.43        5.1

Nordstorm              12.2        2.0              2.9                    5.7      1.8           14.022   0.73         3.7

CenterPoint Engy  11.4        2.8              4.2                    1.3      1.8         24.935      0.62      3.8

Target                      11.2         2.4             4.8                   10.5      1.6          56.411   0.61       4.1

P&G                          10.4         0.9             3.9                     2.9      1.4        234.811   0.66       3.0

General Mills          10.2         1.0             2.8                    5.8      1.4           42.478  0.61        3.4

Tapestry                  10.1          0.9            1.1                    4.3       1.5          17.589   0.48       3.1

Linking to dividend paying stocks, a chart such as this helps you narrow the field to pick the best one for you. It also show you of the hundreds of choices, most will not fit your criteria of being defensive and good growth, but there are excellent choices in the above list. For a dividend paying stock, you want to take the advantage of time to increase your total return, take the advantage of time to make your decision. Remember when you opened your account, the advisor asked you what kind of investor are you? the above criteria can be changed to fit your criteria, but remember what you are trying to do, then do.

There are more questions than answers, till the next time – to raising questions.

PS