Breaking News For Top Dividend Growth Stocks

ASML Holdings (ASML Stock) is experiencing a substantial 21% sell-off after reporting earnings on Tuesday. The company is now down nearly 40% from its July high.

In this update, I'll break down what's happening with ASML and provide a full stock analysis. Plus, I'll highlight 3 more dividend growth stocks reporting earnings this week that might be worth adding to your portfolio.

Let’s do this!

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The Key Story

ASML Stock Tanks - Buying Opportunity?

ASML Holdings (ASML Stock): A Closer Look

ASML is a fantastic business, leading the way in semiconductor manufacturing equipment technology, specifically lithography. They hold a massive competitive advantage—some might even call it a monopoly. Over the past decade, this has translated into excellent stock performance and earnings growth.

On the surface, their earnings looked good. For Q3 2024, revenue came in above expectations by 5%. Earnings per share were $5.80, which is 7% above estimates. They showed strong financial performance, and the outlook for Q4 is robust, expecting net sales between €8.8 billion and €9.2 billion. They also have a substantial backlog of orders to fulfill.

However, one line in the Q3 results sent the stock down: net bookings for the quarter were €2.6 billion, far below the expected €5.39 billion. This indicates a slowdown in demand, dropping back to Q3 2023 levels. It's worth noting that Q3 might just be a slow point in the year, but this decline is significant compared to previous quarters.

Despite these concerns, ASML's stock may have fallen enough to become an attractive buy. The company is currently trading at a 35 P/E ratio with a $6.57 annual dividend, yielding 0.96%. Their revenue per share has grown at a 19% 10-year compound annual growth rate (CAGR), and net income per share is growing at 21.87% over the same period.

Analysts are projecting very high growth for ASML into the future. By 2028, they expect the P/E ratio to be around 11.96 based on current prices. If ASML can achieve these numbers, the stock may be a steal after this recent sell-off.

The consensus price target among Wall Street analysts is $954, making the stock approximately 31% undervalued at current prices.

3 More Top Dividend Growth Stocks Reporting Earnings This Week

Today, before the market opens, 3 dividend growth stocks are reporting earnings that I believe are worth watching:

1. Snap-on Incorporated (SNA Stock)

Snap-on is an industrial company specializing in manufacturing tools. They've been a dividend growth powerhouse, with earnings per share consistently increasing quarter after quarter.

• Dividend Data: The current annual dividend is $7.44 per share, yielding 2.49%. They have a 10-year dividend CAGR of 15.51%, with recent increases around 14%.

• Sustainability: The dividend payout ratio is a comfortable 33% based on free cash flow.

2. Elevance Health (ELV Stock)

Elevance Health is a U.S.-based healthcare company with strong stock performance and earnings growth, similar to another top dividend growth stock UnitedHealth Group.

• Dividend Data: The annual dividend is $6.52 per share, yielding 1.31%, with a 10-year dividend CAGR of 14%. Recent increases have been in the 10-15% range.

• Sustainability: The dividend payout ratio is extremely low at 20% based on free cash flow.

3. Marsh & McLennan Companies (MMC Stock)

Marsh & McLennan is an insurance business with strong stock price growth and earnings over the past decade.

• Dividend Data: The annual dividend is $3.26 per share, yielding 1.43%, with a 10-year dividend CAGR of 11%. Recent increases have been impressive, ranging from 14.7% to 20%.

• Sustainability: The dividend payout ratio is a healthy 33% based on free cash flow.

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— Zach

Disclaimer: Dividend Dividend (Dividend Data LLC) is not a professional financial service. All materials released from Dividend Data (Dividend Data LLC) are for educational and entertainment purposes. Dividend Data (Dividend Data LLC) is not a replacement for a professional's opinion. Contributors to the Dividend Data (Dividend Data LLC) might have equities mentioned in the newsletter