With the economy moving into an extremely uncertain period, it makes sense for investors to look at dividend-paying stocks with strong balance sheets that can withstand an extended slowdown. In that spirit, here's a look at a few stocks that pass their financial health tests and come with a decent dividend yield to boot.
First, a few words on the metrics and filters I used to make this list. Debt to equity is a key measure of financial health, as it represents how much debt has been used to finance a company's assets, so a lower number is better. The current ratio divides a company's current assets by its current liabilities; a result of 1 or above is considered good.
The quick ratio is similar to the current ratio, but in this case it uses the company's liquid current assets (cash, marketable securities, and receivable accounts) and divides them by current liabilities. Here, again, a figure of 1 or above is considered good.