Dividend Stocks
Dividends can produce as much as a third of your total return over long periods, and you can even retire on dividends.
There are 4 key stock dividend dates that are involved with dividend payments:
1- The Declaration Date is several weeks in advance of a dividend payment—it’s when company’s board of directors sets the amount and timing of the proposed payment.
2- The Payable Date is the date set by the board on which the dividend will actually be paid out to shareholders.
3- The Record Date is for shareholders who hold the stock before the payable date and receive the dividend payment. That date is set any number of weeks before the payable date.
4-The Ex-Dividend Date is two business days before the record date and it’s when the shares begin to trade without their dividend. If you buy stocks one day or more before their ex-dividend date, you will still get the dividend. That’s when a stock is said to trade cum-dividend. If you buy on the ex-dividend date or later, you won’t get the dividend. The ex-dividend date is in place to allow pending stock trades to settle.
We think very highly of stocks that have been paying dividends for five or more years, at TSI Network. Many of these stocks fit in well with our three-part Successful Investor philosophy:
1- Invest mainly in well-established companies;
2- Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; and Utilities);
3- Downplay or avoid stocks in the broker/media limelight.
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CAE INC. $14 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 261.4 million; Market cap: $3.7 billion; Price-to-sales ratio: 1.7; Dividend yield: 1.7%; TSINetwork Rating: Average; www.cae.com) began operating in 1947 as Canadian Aviation Electronics Ltd. It originally made ground-communication equipment and antennas for the Royal Canadian Air Force.
In 1952, the company began making flight simulators for air force pilots. It’s now the world’s leading maker of flight simulators for commercial and military aircraft. CAE made about half of the commercial aircraft simulators in use today and has 16% of the military simulator market.
Sales of simulators to airlines tend to move up and down with the economy. To steady its revenue, CAE began training pilots in 2001. It now trains over 100,000 pilots and crew members a year at 50 schools worldwide.
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In 1952, the company began making flight simulators for air force pilots. It’s now the world’s leading maker of flight simulators for commercial and military aircraft. CAE made about half of the commercial aircraft simulators in use today and has 16% of the military simulator market.
Sales of simulators to airlines tend to move up and down with the economy. To steady its revenue, CAE began training pilots in 2001. It now trains over 100,000 pilots and crew members a year at 50 schools worldwide.
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SUNCOR ENERGY INC. $36 (www.suncor.com) produced an average of 437,000 barrels of oil a day at its oil sands projects in November 2013. That’s up 16.5% from 375,000 barrels in October, when the company slowed production due to the temporary shutdown of a pipeline....
CANADIAN TIRE CORP. $95 (www.canadiantire.com) has developed a new all-season tire with a special sidewall that changes colour when the outside temperature falls below a certain point. That tells the driver it’s time to install snow tires. Unique products like this should give Canadian Tire an edge over big U.S....
ENBRIDGE INC. $43 (www.enbridge.com) has raised its quarterly dividend by 11.1%, to $0.35 a share from $0.315. The new annual rate of $1.40 yields 3.3%. The company expects to start operating several new oil pipelines in the next few months. As a result, its earnings should rise from a projected $1.79 a share in 2013 to between $1.84 and $2.04 a share in 2014....
CAE INC. $13 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 261.5 million; Market cap: $3.4 billion; Price-to-sales ratio: 1.5; Dividend yield: 1.8%; TSINetwork Rating: Average; www.cae.com) is the world’s leading maker of flight simulators for commercial airlines, with 70% of the market. It also makes simulators for military clients. The company began training pilots for its customers in 2001 and now has over 100 flight schools in 30 countries.
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METRO INC. $63 (Toronto symbol MRU; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 91.7 million; Market cap: $5.8 billion; Price-to-sales ratio: 0.5; Dividend yield: 1.6%; TSINetwork Rating: Average; www.metro.ca) plans to close its produce and dairy distribution facility in St-Augustin-de-Desmaures, Quebec, and shift these operations to its recently opened plant in Laval.
The company will complete this move in March 2014. It did not say how much it will have to pay in severance or other expenses. However, the plant closure will help Metro cut its operating costs and compete with larger supermarket chains.
Metro is a buy....
The company will complete this move in March 2014. It did not say how much it will have to pay in severance or other expenses. However, the plant closure will help Metro cut its operating costs and compete with larger supermarket chains.
Metro is a buy....
SAPUTO INC. $47 (Toronto symbol SAP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 194.3 million; Market cap: $9.1 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.8%; TSINetwork Rating: Average; www.saputo.com) recently agreed to a friendly takeover of Warrnambool Cheese and Butter Factory, one of Australia’s largest producers of milk, cheese, butter and other dairy products. However, hostile offers from Australian dairy firms have forced Saputo to increase its original bid by 31%.
Australian competition regulators have now blocked Saputo from increasing its 9.6% stake in Warrnambool for the next two months. That will give them time to determine whether these rival bidders, if successful, would gain an overwhelming share of Australia’s dairy market.
Saputo is still a hold....
Australian competition regulators have now blocked Saputo from increasing its 9.6% stake in Warrnambool for the next two months. That will give them time to determine whether these rival bidders, if successful, would gain an overwhelming share of Australia’s dairy market.
Saputo is still a hold....
BOMBARDIER INC. (Toronto symbols BBD.A $4.52 and BBD.B $4.50; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $8.1 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Average; www.bombardier.com) has won an order for five of its new CSeries passenger jets from Iraqi Airways. This client also has options to buy 11 additional planes.
The company now has 182 firm orders for the CSeries. If buyers exercised their options for 237 more planes, these orders would total roughly $32 billion U.S. Bombardier expects to begin deliveries by the end of 2014.
Bombardier B stock is a buy....
The company now has 182 firm orders for the CSeries. If buyers exercised their options for 237 more planes, these orders would total roughly $32 billion U.S. Bombardier expects to begin deliveries by the end of 2014.
Bombardier B stock is a buy....
AGRIUM INC. $95 (Toronto symbol AGU; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 144.5 million; Market cap: $13.7 billion; Price-to-sales ratio: 0.8; Dividend yield: 3.4%; TSINetwork Rating: Average; www.agrium.com) gets two-thirds of its revenue—but just a third of its earnings—from its retail stores, which sell seeds, fertilizers and other products to farmers. It also makes nitrogen-based fertilizer.
Agrium’s retail division is shielding it from volatile fertilizer prices. In the third quarter of 2013, overall sales rose 1.3%, to $2.9 billion from $2.8 billion a year ago (all amounts except share price and market cap in U.S. dollars). A 15.0% retail sales gain offset a 23.7% fertilizer sales drop. Earnings per share fell 37.5%, to $0.50 from $0.80, due to unplanned outages at its nitrogen plants.
Weak fertilizer prices will probably cut Agrium’s 2013 earnings by 20.4%, to $7.60 a share from $9.55 in 2012. The stock trades at 11.8 times that estimate. The $3.00 dividend yields 3.4%.
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Agrium’s retail division is shielding it from volatile fertilizer prices. In the third quarter of 2013, overall sales rose 1.3%, to $2.9 billion from $2.8 billion a year ago (all amounts except share price and market cap in U.S. dollars). A 15.0% retail sales gain offset a 23.7% fertilizer sales drop. Earnings per share fell 37.5%, to $0.50 from $0.80, due to unplanned outages at its nitrogen plants.
Weak fertilizer prices will probably cut Agrium’s 2013 earnings by 20.4%, to $7.60 a share from $9.55 in 2012. The stock trades at 11.8 times that estimate. The $3.00 dividend yields 3.4%.
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POTASH CORP. OF SASKATCHEWAN $33 (Toronto symbol POT $33 Aggressive Growth Portfolio, Resources sector; Shares outstanding: 863.2 million; Market cap: $28.5 billion; Price-to-sales ratio: 3.6; Dividend yield: 4.5%; TSINetwork Rating: Average; www.potashcorp.com) operates five potash mines in Saskatchewan and one in New Brunswick that account for 20% of global capacity. The company also makes fertilizers from nitrogen and phosphate.
Potash Corp. continues to suffer from last July’s breakup of a marketing alliance between producers in Russia and Belarus. The resulting uncertainty has prompted big clients like China and India to delay signing new potash supply deals because they feel prices will keep falling. In the third quarter of 2013, Potash Corp. sold its potash for $307 U.S. a tonne, down 28.4% from $429 U.S. a year earlier.
In response, the company is slowing production and cutting 18% of its workforce. Potash Corp. expects to pay $70 million in severance costs and related charges (all amounts except share price and market cap in U.S. dollars).
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Potash Corp. continues to suffer from last July’s breakup of a marketing alliance between producers in Russia and Belarus. The resulting uncertainty has prompted big clients like China and India to delay signing new potash supply deals because they feel prices will keep falling. In the third quarter of 2013, Potash Corp. sold its potash for $307 U.S. a tonne, down 28.4% from $429 U.S. a year earlier.
In response, the company is slowing production and cutting 18% of its workforce. Potash Corp. expects to pay $70 million in severance costs and related charges (all amounts except share price and market cap in U.S. dollars).
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