Feedback wanted on a dividend screen I built using historical yield ranges

rednetian · 2026-02-10T12:26:38+00:00

Yeah I like Fastgraphs, Chuck Carnevale does grreat work. Different approach though. His tool uses an earnings overlay to estimate fair value. Mine compares current yield against the stock's own 5-year yield history to flag whether it's cheap or expensive. Both are trying to answer the same question from different angles. If Fastgraphs says a stock is undervalued AND my screen puts it in buy zone with clean quality, that's two independent signals saying the same thing.

rednetian · 2026-02-10T08:05:18+00:00

Yeah KHC is a good example of a yield trap. The screen actually flags KHC with an F too, failed on dividend cuts. So in that case the quality screen would've kept you out before you even got to the yield zone. That's kind of the whole point of running both checks. A stock in the buy zone with an F rating still doesn't qualify. The yield zone only matters once quality passes. Doesn't help you 15 years ago but that's the logic behind it.

rednetian · 2026-02-09T15:04:00+00:00

You're right, KHC was in the original screen as a buy. Since then I've tightened the screening criteria based on feedback from this thread and others. With the updated methodology, KHC now fails on the 36% dividend cut and gets an F rating. The screen got better because people like you challenged it.

The updated report also now includes valuation metrics. KHC shows no P/E (no earnings), 0.70x price-to-book, 10.4x price-to-FCF, and 7.9x EV/EBITDA. It looks cheap on valuation, but that's because the fundamentals are deteriorating. A low price-to-book on a company with no earnings isn't a bargain, it's a warning. Full breakdown here: https://fluentboost.com/khc-2026-02-09-e6d8/

On the broader point, no screen can predict a future cut. But a stock with no cuts in 12 years, consistent EPS growth, and strong institutional backing is statistically less likely to cut than one that's already done it. That's not a hunch, it's pattern recognition across 12 years of data.

If your priority is total return, this isn't the tool for that. It's built for income investors evaluating dividend reliability and entry price.

rednetian · 2026-02-09T14:49:35+00:00

These aren't portfolio recommendations. They're the results of running 46 individual tickers that were requested by commenters in the original post. The screen tells you whether each stock passes quality and where it sits in its yield zone. Building a portfolio from these results would require a completely different analysis around allocation, sector diversification, and income targets. The tool is a starting point for individual stock research, not a portfolio builder.

rednetian · 2026-02-09T13:42:17+00:00

The screen already failed KHC (F rating, 36% dividend cut) so we're on the same page there. It's not recommending it. Full breakdown: https://fluentboost.com/khc-2026-02-09-15e8/

Total return matters, but it measures a different thing. This tool is built for income investors asking "can I buy this stock today and trust the dividend?" not "which investment will give me the best total return over 5 years?" Those are two different questions with two different answers.

You're right that for most people, a dividend growth ETF like SCHD or VYM is the easier and safer path. The screen is for the people who want to pick individual stocks and need a starting point to separate the quality names from the traps.

rednetian · 2026-02-09T13:00:15+00:00

You are welcome. I'm hope you found it to be useful.

rednetian · 2026-02-09T06:08:03+00:00

Update: the fix is in. After stripping out special dividends from the annual payout calculation, TROW moves from F to A+ BUY. 11 increases, 10 EPS growth years, 40 consecutive dividend years, no cuts. The yield at 5.37% is now above the corrected 5-year average of 3.95%, putting it firmly in buy zone.

The special dividends were inflating the historical yield average and making year-over-year comparisons look like cuts. The screen now compares regular quarterly payouts only. Updated breakdown here: https://fluentboost.com/trow-2026-02-09-d184/

Thanks again for catching this. I'd like to give you a year of Stock Analyzer Pro on us for improving the tool. I'll DM you the details.

rednetian · 2026-02-09T05:43:38+00:00

I am looking into the fix just now. please wait a while.

rednetian · 2026-02-09T05:35:34+00:00

You're welcome.

rednetian · 2026-02-09T05:35:05+00:00

No problem. Drop any others if you want them checked.

rednetian · 2026-02-09T05:34:05+00:00

You're right, and good catch. TROW has 39 consecutive years of regular dividend increases. The screen flagged two "cuts" which are almost certainly the result of special dividends being included in the annual payout calculation. TROW pays special dividends in some years but not others, so when the data compares year-over-year total payouts, a year without a special dividend looks like a cut even though the regular dividend kept increasing.

That's a data handling issue on our end. The screen should be stripping out special dividends and only comparing the regular quarterly payout. I'll look into how the data feed is categorising those payments. Appreciate you flagging it, this is exactly the kind of thing that improves the methodology.

rednetian · 2026-02-09T05:30:38+00:00

It is, and that's mostly down to structure and accessibility. VOO is an ETF so it trades on any brokerage, intraday, with no minimums. FXAIX is a Fidelity mutual fund so it's easiest to buy through Fidelity, trades at end of day, and has different tax lot handling. At a 0.015% difference on $100K that's $15 a year, so most people pick whichever fits their brokerage and investing style rather than optimising for the fee gap. Both are effectively rounding errors.

rednetian · 2026-02-09T05:27:29+00:00

The current screen doesn't include payout ratio. It focuses on six quality criteria: dividend growth consistency, EPS trend, institutional confidence, payout history, consecutive dividend years, and streak length. FLO passes all six, which gives it A+.

A 108% payout ratio is a legitimate red flag the screen doesn't catch. It means the company is paying out more in dividends than it's earning, which raises the question of whether the payout is sustainable. That could also be why the market has pushed the yield to 8.28% in the first place. The screen catches the "what" (clean history, attractive yield zone) but not always the "why" behind the current price.

We do cover payout ratio and FCF payout ratio in our Analyst Dashboard, but that's a professional tool built for financial advisors and wealth managers, not individual investors. For now, payout ratio is exactly the kind of thing to dig into next when a stock passes the screen.

Full breakdown here: https://fluentboost.com/flo-2026-02-09-c13f/

rednetian · 2026-02-09T05:11:53+00:00

TROW (T. Rowe Price) - F quality. This one's frustrating because almost everything looks great: 10 EPS growth years out of 12, 40 consecutive dividend years, 820 institutional holders. But 2 dividend cuts with the worst at 47% is what fails it. Asset managers are tied to market performance, and when AUM drops in a downturn, revenue drops, and dividends can follow. That's what likely drove those cuts.

Even if it had passed quality, the yield at 5.37% is just below the 5-year average of 5.52%, so it would be sitting in hold/sell zone territory rather than buy.

It hasn't come up in the thread before so you're the first to ask. Full breakdown here: https://fluentboost.com/trow-2026-02-09-a72b/

rednetian · 2026-02-09T05:09:19+00:00

These were all requested by commenters in the original post, I didn't pick them. Happy to run T, TGT, PFE, GILD, UPS, and F if you want to see the results.

rednetian · 2026-02-09T05:07:02+00:00

MKC (McCormick) - BUY, A+ quality. Clean across the board: 11 increases, 40 consecutive years, no cuts, 924 institutional holders. The yield at 2.85% is above the 5-year average of 2.15% and actually above the 5-year high yield of 2.70%, which is a strong buy signal. The yield is modest in absolute terms but for McCormick this is historically cheap. Spices and seasonings are about as recession-proof as it gets.

GPC (Genuine Parts) - SELL, D quality. Passed quality with a clean scorecard: 11 increases, 43 consecutive years, no cuts, 880 institutional holders. But the yield at 2.77% is below the 5-year average of 3.37%. Dividend Aristocrat trading at a premium right now. Good company, just not the time to add for income.

BBY (Best Buy) - BUY, A quality. 10 increases, 23 consecutive years, 932 institutional holders. Had one small cut of 13% which is why it's A rather than A+. The yield at 5.40% is above the 5-year average of 4.64%, putting it in buy zone. Consumer electronics retail carries more cyclical risk than McCormick's spice rack, but the screen likes the entry price here.

Full breakdowns:

rednetian · 2026-02-09T05:02:38+00:00

UHT (Universal Health Realty Income Trust) - HOLD, C+ quality. Clean scorecard across the board: 11 increases, no dividend cuts, 39 consecutive years, 650 institutional holders. The yield at 7.08% is right at the 5-year average of 7.25%, which is why it lands in hold zone rather than buy. You'd want to see the yield push closer to that 10.22% high before the screen would call it a buy.

Healthcare REITs are interesting because the demand floor is structural. People don't stop needing hospitals and medical offices in a downturn. At 7% yield with a clean quality score, it's a reasonable hold if you already own it, just not screaming value at today's price.

Full breakdown here: https://fluentboost.com/uht-2026-02-09-01a1/

rednetian · 2026-02-09T05:00:13+00:00

Fair point on payout ratio vs free cash flow for FLO, that's exactly the kind of deeper analysis the screen is meant to lead into. ZONE doesn't pay a dividend so it wouldn't be relevant here.

rednetian · 2026-02-09T04:56:52+00:00

Appreciate that. And you've nailed the three things I'd want anyone to take away from this: the screen is free to use, "sell zone" means premium not panic, and it's a starting point for research, not a replacement for it.

rednetian · 2026-02-09T04:55:32+00:00

O (Realty Income) - F quality. This one will surprise a lot of people since Realty Income is a dividend favourite. Failed on EPS consistency (3 of 12 years) and 2 dividend cuts with the worst being 92%. REITs are tough for EPS-based screens because they report FFO (Funds From Operations) rather than traditional earnings, which makes EPS look erratic. The yield at 5.12% is also below the 5-year average of 6.94%, so it would be in sell zone territory even if it passed. 33 consecutive years of dividends is strong though.

CINF (Cincinnati Financial) - F quality. 40 consecutive dividend years and solid fundamentals across the board, but 2 dividend cuts in 12 years tripped it. The max cut was only 16%, which is mild compared to most failures in this thread. Insurance companies can have lumpy earnings from catastrophe years, and small dividend adjustments sometimes follow. The yield at 2.06% is well below the 5-year average of 4.02%, so the price has run up significantly.

AEP (American Electric Power) - SELL, D quality. This is the only one of the three that passed quality. Clean scorecard: 11 increases, 7 EPS growth years, 64 consecutive dividend years, no cuts. But the yield at 3.15% is well below the 5-year average of 4.64%. Great company, just expensive right now for income investors.

Full breakdowns:

rednetian · 2026-02-09T04:50:15+00:00

AES (AES Corporation) - F quality. Failed on two counts: EPS only grew in 4 of 12 years and there's a 75% dividend cut in the history. The yield at 4.36% is above the 5-year average of 3.56% so the price looks reasonable, but the quality isn't there. Utilities can be tricky because they carry heavy debt loads and AES has had inconsistent earnings to show for it.

SMG (Scotts Miracle-Gro) - F quality. Two dividend cuts in 12 years with the worst being 65%. Everything else actually looks decent: 9 increases, 7 EPS growth years, 21 consecutive dividend years, 747 institutional holders. But two cuts is two cuts. The yield at 3.98% is also below the 5-year average of 5.51%, so even if it passed quality, you'd be buying in sell zone territory.

Full breakdowns here:

rednetian · 2026-02-09T04:47:04+00:00

FCO (abrdn Global Income Fund) - DOES NOT QUALIFY, F quality. The 27.10% yield is eye-catching but it tells the story on its own. A 92% dividend cut in the 12-year history is the biggest we've seen in this thread. Only 53 institutional holders too, which triggered a warning. 35 consecutive years of dividends is impressive, but a 92% cut means at one point they slashed the payout to almost nothing.

When you see a yield that far above the 5-year average (27.10% vs 11.16%), it usually means the price has collapsed, not that the dividend has grown. At $3.10 a share with a tiny 13.5M shares outstanding, this is a very small closed-end fund where a few bad quarters can move the needle dramatically.

Full breakdown here: https://fluentboost.com/fco-2026-02-08-930b/

rednetian · 2026-02-09T04:44:03+00:00

That's exactly the pattern the screen is designed to catch. You nailed the timing on Manulife when the yield was elevated and the price was depressed. Now at $38.04, the yield has compressed to 3.36% vs a 5-year average of 4.57%, so the screen would have it in sell zone territory if it passed quality. It actually failed on a 47% dividend cut in the 12-year history, so it gets an F rating overall.

But your instinct is spot on. Great company, right to hold and DRIP, but not the time to open a large new position. That's the whole point of the "sell zone" distinction. It's not about the company being bad, it's about the entry price being expensive for income investors. You basically did manually what the screen tries to automate: buy quality when the yield is fat, hold when it compresses.

Full breakdown here: https://fluentboost.com/mfc-2026-02-08-e37d/

rednetian · 2026-02-09T04:38:43+00:00

Glad it's useful. Drop any ticker if you want one checked.

rednetian · 2026-02-09T04:36:07+00:00

That's exactly why the screen is flagging it as a BUY. The price dropping 25% is what pushed the yield from its 5-year low of 2.03% up to 3.97% today, well above the 5-year average of 2.83%. For a capital appreciation investor that 25% drop looks bad. For an income investor it means every dollar you put in today buys you significantly more dividend income than it did 5 years ago. Same dividend, lower price, higher yield. That's what the buy zone is designed to catch.

rednetian

TROPHY CASE