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.
[text_ad use_category="243"]
Read More
Close
ROYAL BANK OF CANADA $56 (Toronto symbol RY; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.4 billion; Market cap: $78.4 billion; Price-to-sales ratio: 2.1; Dividend yield: 3.6%; SI Rating: Above Average) is Canada’s largest bank, with total assets of $655.0 billion. Royal is seeing strong demand for loans because of low interest rates. As well, improving financial markets have helped its capital-markets division attract new business. This division, which Royal has steadily expanded in the past few years, helps companies raise capital by selling shares and issuing debt. It now provides 25% of the bank’s total revenue. In the year ended October 31, 2009, Royal’s revenue rose 34.9%, to $29.1 billion from $21.6 billion in the prior year. Earnings rose 6.7%, to $4.9 billion from $4.4 billion. However, earnings per share fell 3.0%, to $3.28 from $3.38, on 7% more shares outstanding. The 2009 figures exclude a $1-billion writedown of goodwill related to Royal’s U.S. operations. Its U.S. and international banking division supplies roughly 10% of its revenue....
TORONTO-DOMINION BANK $64 (Toronto symbol TD; Conservative Growth Portfolio, Finance sector; Shares outstanding: 858.8 million; Market cap: $55.0 billion; Price-to-sales ratio: 2.2; Dividend yield: 3.8%; SI Rating: Above Average) is the second-largest Canadian bank, with total assets of $557.2 billion. TD has now fully integrated Commerce Bancorp Inc. with its other U.S. banking operations. The bank paid $8.5 billion for Commerce in May 2008. It now operates as “TD Bank,” and has 1,028 branches from Maine to Florida. The U.S. banking business provides 16% of TD’s overall profits. If you include $276-million in integration costs and $576-million of writedowns of securities, TD’s earnings in the year ended October 31, 2009, fell 18.6%, to $3.1 billion from $3.8 billion in the prior year. Earnings per share fell 28.7%, to $3.47 from $4.87, on more shares outstanding. Revenue rose 21.8%, to $17.9 billion from $14.7 billion, as low interest rates spurred strong demand for new loans....
BANK OF NOVA SCOTIA $47 (Toronto symbol BNS; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.0 billion; Market cap: $47.0 billion; Price-to-sales ratio: 1.9; Dividend yield: 4.2%; SI Rating: Above Average) is Canada’s third-largest bank, with total assets of $496.5 billion. Bank of Nova Scotia is the most international of the big-five banks. It gets about 30% of its earnings from its overseas operations, which are mainly in the Caribbean, Latin America and Asia. These businesses have struggled lately, as the global recession pushed up loan losses. But the rebounding world economy gives them long-term appeal. The bank earned $3.5 billion in the year ended October 31, 2009. That’s up 13.0% from $3.1 billion in the prior year. Earnings per share rose 8.5%, to $3.31 from $3.05, on more shares outstanding. If you exclude writedowns of securities, it would have earned $3.70 a share in 2009. Revenue rose 21.7%, to $14.5 billion from $11.9 billion....
BANK OF MONTREAL $54 (Toronto symbol BMO; Conservative Growth Portfolio, Finance sector; Shares outstanding: 550.5 million; Market cap: $29.7 billion; Price-to-sales ratio: 1.9; Dividend yield: 5.2%; SI Rating: Above Average) is the fourth-largest Canadian bank, with total assets of $388.5 billion. The bank earned $1.8 billion in fiscal 2009, down 9.7% from $2.0 billion in the prior year. Earnings per share fell 18.1%, to $3.08 from $3.76, on more shares outstanding. Excluding writedowns and other unusual items, the bank would have earned $4.02 a share in fiscal 2009. Revenue rose 8.4%, to $11.1 billion from $10.2 billion. That’s mainly because low interest rates continue to push up demand for mortgages and other loans....
CANADIAN IMPERIAL BANK OF COMMERCE $66 (Toronto symbol CM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 384.0 million; Market cap: $25.3 billion; Price-to-sales ratio: 1.8; Dividend yield: 5.3%; SI Rating: Above Average) is Canada’s fifth-largest bank, with assets of $335.9 billion....
Canada’s telephone companies continue to face rising competition. Along with wireless and cable companies, Internet-based phone services, such as Skype, have also gained in popularity. Now, three new wireless providers (Globalive’s WIND Mobile, DAVE Wireless, and Public Mobile) are set to enter the Canadian market. This new competition will put pressure on BCE Inc. (symbol BCE on Toronto), Canada’s largest telephone service provider. In light of this and other developments surrounding this conservative investing stock, we’ve updated our buy/sell/hold advice in the latest Canadian Wealth Advisor, our newsletter for safety-conscious conservative investing....
We analyze a wide range of investments in Canadian Wealth Advisor, our newsletter for safety-conscious investors. These include the 19 common stocks we’ve selected for our “Safety-Conscious Stock Portfolio.” All these stocks are well-established companies with bright prospects and strong positions in healthy industries. As well, almost all offer dividend reinvestment plans, or DRIPs. DRIPs let shareholders reinvest dividends to buy additional shares (or fractions of shares) of the company. DRIPs bypass brokers, so shareholders save on commissions....
Grocery retailer Metro Inc. (symbol MRU.A on Toronto) is a good example of a stock that has graduated from Stock Pickers Digest, our newsletter for aggressive investors, to The Successful Investor, which focuses on more conservative selections. Stock Pickers Digest is where we analyze stocks that are attractive but not yet suitable for The Successful Investor’s conservative investing focus. Ideally, many of our Stock Pickers buys will one day mature into investments that we can recommend in The Successful Investor. We first added Metro to the stocks we analyze in Stock Pickers Digest in June 1998. At the time, it was trading at around $10. In December 2007, when we moved it to The Successful Investor, it was trading at about $32, for a 220% gain....
Investors are paying more attention to dividend yields (a company’s total annual dividends paid per share divided by the current stock price) as volatile stock markets continue to recover. Companies are responding by doing their best to maintain, or even increase, their dividend payments. That’s good news for investors, because dividends are more dependable than capital gains as a source of income. In fact, dividends typically contribute up to a third of an investor’s long-term return. Tax cuts in recent years also mean that you pay roughly the same tax on dividend income and capital gains.
Look at the complete picture when buying high dividend stocks
...
TORSTAR CORP. $6.25 (Toronto symbol TS.B; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 79.0 million; Market cap: $493.8 million; Price-to-sales ratio: 0.4; Dividend yield: 5.2%; SI Rating: Above Average) publishes The Toronto Star, which is Canada’s largest daily newspaper in terms of circulation. The company also publishes three other daily papers and over 100 weeklies, mainly in southern Ontario. Newspapers and web sites account for about 70% of Torstar’s revenue, and 60% of its earnings. The company’s other main business is wholly owned Harlequin Enterprises Ltd., the world’s leading publisher of romance novels. Harlequin also publishes non-fiction titles, such as self-help and diet books. Torstar’s aggressive cost cutting has helped it stay profitable in the face of falling advertising revenue and increased competition from the Internet. For example, it has cut roughly 8% of its workforce over the past year. These layoffs lowered the company’s expenses by $26.2 million in the first three quarters of 2009. Torstar expects to realize an additional $8.2 million in savings in the fourth quarter....