The Dividend Project - Bringing it all Together

Don't let the title of the post mislead you - I'm not done yet!

But today I wanted to bring together some of the numbers that we have seen in analyzing the major banks and start to talk about how to set a price at which you would want to buy a stock. Here then is a summary using today's numbers of the five major banks (click image to enlarge):

Now I know these are a lot of numbers, so I will go through them logically.

First, the bottom two sections are my raw data. This time I did not rely on anyone else's calculations, I went and got the information to calculate it myself. I got the last four quarters' earnings and dividend numbers and added them up to get the 12 month trailing numbers.

Then, starting back at the top:

• The yellow row is today's closing prices.
• The white row is the 10 year growth numbers from the Globe article that I found a few days ago. I just kept them in there for reference.
• The first orange section is dividend yield. For the trailing dividend yield I divided the trailing 12 month dividend from the orange section below by today's closing price. For the current dividend yield I took the last dividend times 4 and divided by the lcosing price.
• The first blue section is the price to earnings ratios. For the trailing P/E, I divided the closing price by the 12 month trailing earnings. For the current P/E, I divided the closing price by 4 times the last earnings (note: this is sometimes called forward p/e, I believe).
• Finally, I calculated payout ratios be dividing trailing dividend by trailing earnings and last dividend by last earnings.

So now comes the big question - are these a good buy at today's price? If not, at what price? And despite my big talk at the beginning of this post, I am going to chicken out and not name prices today. I want to do more reading about these numbers and what they can represent because as I look at them my head goes round in circles. I can come up with an explanation for white in one breath, and black in the next.

I really like this little chart though. I feel like finally I can see where these numbers are coming from and how they all relate to each other.

BRILLIANT IDEA!!!
I'm going to try to run these numbers for MY COMPANY. Okay, I know it sounds strange and it may not be exact since my company doesn't have a real share price, but it will relate it to something that I know really well. Stay tuned, folks. This story is just about to get interesting....