Since recently giving up on my Magic Formula Portfolio, I feel like a burden has been lifted. I’m enjoying reinvesting these funds in companies that I believe in, especially those that pay growing dividends. But I haven’t completely abandoned Greenblatt’s Magic Formula. I still use the screener to identify stocks that I’m already interested in but that might be undervalued in the market.
Screener Settings
The default Minimum Market Cap is 50 million. I change it to… 5,000 million? That’s five billion dollars, people. It screens out the smaller companies that don’t usually pay stable, growing dividends. Then I choose to see 50 stocks.
Results
A couple of these stocks (Cisco and Nucor) are on the list of S&P 500 Dividend Aristocrats, meaning they’re in the S&P 500 and they’ve increased their dividends for each of the last 25 years. The 11 red dots next to the companies in the screen shots below, taken from MagicFormulaInvesting.com, indicate companies that have an established track record of paying market-beating dividends. I probably missed some.
Ha! I see old HPQ! I think they must have paid Joel Greenblatt a fee to permanently show up on his Magic Formula Investing site. HPQ’s dividend is 3.55% at time of writing by the way. The results continue:
I personally invest in many of these. When you have a portfolio of many stocks it’s easy to lose track of them. Occasionally taking a look at this site can help to identify stocks of interest that that may be undervalued in market.
Leave a Reply