Market Overview

CVR Energy, Warner Chilcott and Other Top Performers in May

Two oil and gas companies -- CVR Energy (NYSE: CVI) and W&T Offshore (NYSE: WTI) -- were among the top performing dividend-paying stocks in May.

So were drug maker Warner Chilcott (NASDAQ: WCRX) and semiconductor company Himax Technologies (NASDAQ: HIMX). Below we take a glance at how these four stocks have fared and what analysts expect.

Some of May's other top performers with dividends include trucking company Arkansas Best (NASDAQ: ABFS), Bon-Ton Stores (NASDAQ: BONT), insurer Homeowners Choice (NYSE: HCI) and Chinese online game company Perfect World (NASDAQ: PWRD).

CVR Energy

This petroleum refiner and fertilizer producer last week declared a special dividend with a yield near nine percent. Headquartered in Sugar Land, Texas, this subsidiary of Icahn Enterprises (NASDAQ: IEP) sports a market capitalization of about $5.5 billion. The quarterly dividend yield is about 4.4 percent.

The price-to-earnings (P/E) ratio is lower than the industry average. The operating margin is better than the industry average, and the return on equity is more than 44 percent. Note that short interest was less than two percent of the float at the most recent settlement date.

However, none of the four analysts surveyed by Thomson/First Call who follow this stock recommend buying shares. So it probably should be no surprise that the share price has overrun the mean price target, or where the analysts expect the share price to go. However, the street-high target indicates more than 11 percent upside potential.

Shares of CVR Energy are more than 30 percent higher since the beginning of May, despite pulling back more than nine percent late last week. Over the past six months, the stock has outperformed the broader markets and competitor HollyFrontier (NYSE: HFC).

Himax Technologies

This Taiwanese maker of semiconductors for flat panel displays reported better-than-expected first-quarter results, and Oppenheimer analysts talked up the stock this past week. The dividend yield is about 0.9 percent and the market cap is more than $1 billion.

The long-term earnings per share (EPS) growth forecast is more than 31 percent, and the P/E ratio is lower than the industry average. The operating margin is greater than the industry average. Short interest in Himax was less than one percent of the float in mid-May.

All three of the analysts surveyed recommend buying Himax shares, with one of them rating the stock at Strong Buy. The mean price target implies more than 14 percent potential upside relative to the current share price. That target represents a level shares have not seen since 2006.

Shares are trading more than 31 percent higher than they were a month ago, as well as being up about 158 percent year-to-date. Over the past six months, this stock has outperformed the likes of Linear Technology (NASDAQ: LLTC) and Maxim Integrated Products (NASDAQ: MXIM), as well as the broader markets.

Warner Chilcott

Shares surged earlier in May on news that generic drug maker Actavis (NYSE: ACT) intended to acquire this Irish specialty pharmaceutical company. Warner Chilcott has a market cap of less than $5 billion and a dividend yield of about 2.5 percent.

The P/E ratio is lower than the industry average but the long-term EPS growth forecast is less than two percent. The operating margin is greater than the industry average. The number of shares sold short represents a little more than two percent of the company's float.

Of the 16 analysts polled, 13 recommend buying shares, with five on those rating the stock at Strong Buy. The analysts believe shares have some head room, as their price target is about nine percent higher than the current share price. Shares last traded in the neighborhood of that consensus target in May of 2012.

The share price is up about 35 percent in the past month, as well as almost 55 percent higher year-to-date, despite retreating almost seven percent from a recent 52-week high. The stock has outperformed the broader markets and competitors Eli Lilly (NYSE: LLY) and Johnson & Johnson (NYSE: JNJ) over the past six months.

W&T Offshore

This developer of oil and natural gas properties in the Gulf of Mexico and Texas reported first-quarter results that were better than analysts had expected. The Houston-based company has a little more than $1 billion market cap. Its dividend yield is near 2.4 percent.

The P/E ratio is a lower than the industry average. W&T Offshore's operating margin is greater than the industry average, and the return on equity is about 17 percent. Note though that the short interest was more than 17 percent of the float at the most recent settlement date.

The consensus recommendation of the surveyed analysts is to hold shares, and it has been for at least three months. However, their mean price target is more than 24 percent higher than the current share price. But note that the consensus target is less than the 52-week high reached last September.

Shares rose more than 31 percent in May, but the share price is still about 13 percent lower than at the beginning of the year. Over the past six months, the stock has underperformed peers Cheniere Energy (NYSE: LNG) and Newfield Exploration (NYSE: NFX), as well as the broader markets.

Posted-In: arkansas best Bon-Ton Stores Cheniere Energy CVR Energy eli lilly Himax Technologies hollyfrontier Homeowners Choice Icahn Enterprises Johnson & Johnson linear technology Maxim Integrated Products Newfield Exploration Perfect World W&T Offshore warner chilcottLong Ideas Short Ideas Trading Ideas Best of Benzinga

 

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