SQL Analysis of a Stock Data set for Dividend Ratios

I wanted to analyze a small set of stocks from the Dow 30 relative to their respective dividend ratios. The purpose was to identify those with above(below) average dividend yields, above (below) average payout ratios and those with above(below) average 5 year dividend growth rates.

I created a table in My SQl with the columns needed for the analysis and did the following.

select avg(div_yield) as average_div_yield from stocks; -- 2.3

select avg(pay_ratio) as average_pay_ratio from stocks; -- 39.7

select avg(div_growth) as average_div_growth from stocks as avdiv; -- 9.1

I then ran this code to find the symbols with above average ratios.

select * from stocks where div_yield > 2.3;

select name from stocks where div_yield > 2.3 order by name; --- amgn, csco, cvx, gs, ko

select * from stocks where pay_ratio > 39.7; ----amgn, csco, hd, hon, ko

select * from stocks where div_growth > 9.1;

---amgn, gs, hd

Amgen was the only stock, albeit from a small sample, whose ratios were above average on all 3 metrics.

I then ran the following:

select * from stocks where pay_ratio <39.7;

-- payout ratio lower than avg axp, aapl, cat, cvx, gs

These companies would seem to have plenty of room to grow their dividends.

I then ran the following :

select * from stocks where div_yield > 2.3 and pay_ratio > 39.7; -- div yield and pay ratio higher than avg amgn csco, ko (These stocks have above average dividend yields greater than average payout ratios, this speaks to possible safety of the future dividends.

select * from stocks where div_yield > 2.3 and pay_ratio < 39.7; -- div yield higher than avg, payout ratio lower=room to grow cvx, gs

(These stocks have higher than average dividend yields and lower than average payout ratios. To me this would indicate room to grow.

select * from stocks where div_yield > 2.3 and pay_ratio > 39.7 and div_growth >9.1; Again, Amgen was the only stock above all three

I then ran standard deviation for the ratios. SELECT STDDEV(div_yield) from stocks; --- 0.78 stdev div yield

select avg(div_yield) as average_div_yield from stocks

select avg(div_yield) + .7 as stdev from stocks; ---3% is one st dev from the average div yield

select * from stocks where div_yield >= 3; ----amg, csco, cvx, gs ko (The above stocks had div yields higher than one standard deviation above average.

select 3+.78;

-- two standard dev from average div yield -- 3.78

select * from stocks

--no stocks are 2 stdev above average div_yield . SELECT STDDEV(pay_ratio) from stocks; -- 12.88

I added one standard deviation to the average payout ratio.

select * from stocks where pay_ratio > 52.5; --csco, Ko (These two stocks have payout ratios higher than one standard deviation from the average payout ratio.

I then wanted to screen for stocks one standard deviation or more lower than the average payout ratio.

select * from stocks where pay_ratio < 21.82;

-- amex, aapl

(Amex and AAPL seem stingy with plenty of room to safely return cash back to shareholders).

I then wanted to screen for dividend yields and payout ratios both lower than one standard deviation from the respective average.

select * from stocks where pay_ratio < 21.8 and div_yield < 3;

-- amex, aapl

Again, AMEX and Aapl.

A very interesting sidenote, from Baron's shortly after this analysis was completed.

"In light of its results, Amex said it would be lifting its quarterly dividend by 15% to 60 cents a share. In 2023, Amex expects to see revenue growth in the range of 15% to 17% and earnings per share in the range of $11 to $11.40. Full-year earnings per share for 2022 were $9.85".