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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PETRO-CANADA $51 (Toronto symbol PCA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 495.8 million; Market cap: $25.3 billion; SI Rating: Average) is Canada’s secondlargest integrated oil company after Imperial Oil. The company operates several properties in Western Canada as well as offshore platforms near Newfoundland. It also operates refineries and over 1,300 retail gas stations. Canada accounts for roughly 90% of Petro-Canada’s revenue. Internationally, the company owns or participates in projects in the North Sea, Libya, and Trinidad and Tobago. In the three months ended March 31, 2007, Petro-Canada earned $1.17 a share before unusual items, up 23.2% from $0.95 a year earlier....
ENCANA CORP. $62 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 761.3 million; Market cap: $47.2 billion; SI Rating: Average) is one of North America’s largest producers of natural gas (80% of total production) and oil (20%). In the past few years, EnCana has sold most of its conventional properties to focus on what it calls “key resource plays”, including oil sands and early-stage gas developments. These assets cost more to develop, at least initially, but should last much longer than its older properties. Another project EnCana has high hopes for is the Deep Panuke offshore gas field near Nova Scotia. The company has received tentative regulatory approval for its plan, and aims to begin operations in 2010....
TRANSCONTINENTAL INC. $22 (Toronto symbol TCL.A; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 85.8 million; Market cap: $1.9 billion; SI Rating: Average) is the largest commercial printing firm in Canada, and the sixth largest in North America. The company gets about half of its revenue from its marketing division, which prints catalogues, flyers and other advertising materials. Transcontinental also helps its advertisers develop strategies, and analyze customer data for trends. Other types of printing, such as newspapers, books and magazines, accounts for 30% of its revenue. The remaining 20% of revenue comes from its media division. Transcontinental publishes over 150 local and weekly newspapers in Atlantic Canada, Quebec, Ontario and Saskatchewan, as well as over 40 consumer interest magazines, including Canadian Living and The Hockey News....
SHAWCOR LTD. $29 (Toronto symbol SCL.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 74.0 million; Market cap: $2.1 billion; SI Rating: Average) makes coatings that protect oil and natural gas pipelines from corrosion. The company also inspects and repairs pipelines, and makes drilling equipment. In 2006, income from continuing operations rose 13.6%, to $1.25 a share (total $92.9 million) from $1.10 a share ($82.8 million) a year earlier. If you disregard an unusual tax recovery in 2005, income would have grown 44%. Most of the gain came from new, more profitable pipeline coating contracts and ongoing cost controls. Cash flow per share rose 7.3%, to $1.90 from $1.77. Revenue grew 5.0%, to $1.06 billion from $1.01 billion. The company gets 75% of its revenue from customers outside of Canada, and the higher Canadian dollar cut its 2006 revenue by $41.5 million....
SNC-LAVALIN GROUP INC. $33 (Toronto symbol SNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 151.0 million; Market cap: $5.0 billion; SI Rating: Average) is a leading Canadian engineering and construction company. SNC specializes in large-scale public works projects, such as roads, bridges, transit systems and water treatment systems. It also builds chemical plants and electrical power systems. In the past few years, SNC has expanded into concessions. These are public facilities that it builds and runs on behalf of governments. SNC’s biggest concession project is its 16.77% interest in Highway 407, a toll highway just north of Toronto. Concessions give SNC predictable revenue streams, which cuts its reliance on new projects for growth. In 2006, SNC earned $0.89 a share (total $136.6 million) from continuing operations, up 29.0% from $0.69 a share ($105.6 million) a year earlier. Revenue grew 50.7%, to $5.2 billion from...
GENNUM CORP. $12 (Toronto symbol GND; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 35.8 million; Market cap: $429.6 million; SI Rating: Above average) makes chips and other equipment that let broadcasters store, manipulate and transport video signals without losing picture quality. Video products supply about two-thirds of Gennum’s revenue. The company also makes audio products such as hearing aids and telephone headsets, as well as chips for high-speed computer networks. In its first fiscal quarter ended February 28, 2007, Gennum’s profits rose 20%, to $0.12 a share (total $4.3 million) from $0.10 a share ($3.7 million) a year earlier. Most of the gain came from recent cost cuts, since revenue grew just 1.2%, to $34.9 million from $34.5 million....
FINNING INTERNATIONAL INC. $54 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 89.5 million; Market cap: $4.8 billion; SI Rating: Above average) is one of the world’s largest dealers of heavy equipment made by Caterpillar Inc., such as tractors, bulldozers, pavers and trucks. Major customers include the mining, forest products and construction industries. Revenue grew at a compound annual rate of 11.8%, from $3.2 billion in 2002 to $5.0 billion in 2006. Most of that growth is due to higher commodity prices, which have spurred strong demand for heavy equipment from mining and oil exploration firms. Profits from continuing operations were $1.68 a share (total $132.3 million) in 2002 and $1.68 a share ($132.0 million) in 2003, but rose to $2.27 a share ($240.7 million) in 2006. (These per-share figures do not reflect a 2-for-1 stock split planned for May 2007.) Cash flow per share rose from $5.99 in 2002 to $6.55 in 2003. It fell to $6.37 in 2004, and to $5.95 in 2005, but grew to $6.71 in 2006....
CANADIAN UTILITIES LTD. (Toronto symbols CU $42 (Class A) and CU.X $42 (Class B); Income Portfolio, Utilities sector; Shares outstanding: 125.4 million; Market cap: $5.3 billion; SI Rating: Above average) is a leading supplier of natural gas and electricity in Alberta. It has 970,000 gas customers, and 216,000 electricity customers. It also operates power plants in other parts of Canada, as well as in the UK and Australia. ATCO Ltd. controls about 74% of the company’s class B voting common shares. In the past few years, Canadian Utilities has sold many of its unregulated operations. That hurts its growth prospects, but also limits its overall risk. It now gets about half of its revenue and income from regulated operations....
EMERA INC. $20 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 110.9 million; Market cap: $2.2 billion; SI Rating: Average) is the main supplier of electrical power in Nova Scotia, with 470,000 customers. It also provides power to 115,000 customers in Bangor, Maine. Right now, the company gets over 80% of its income from its main Nova Scotia Power subsidiary. Through acquisitions and investments, Emera eventually aims to cut this to 65%. For example, the company plans to invest $350 million in a new pipeline that will transport natural gas from a planned liquefied natural gas terminal in Saint John, New Brunswick to markets in Canada and the Northeastern United States. Emera also recently paid $22 million U.S. for a 19% stake in the main electrical utility on the Caribbean island of St. Lucia....
FORTIS INC. $27 (Toronto symbol FTS; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 104.9 million; Market cap: $2.8 billion; SI Rating: Above average) operates electrical power plants in Atlantic Canada, Ontario, Alberta and British Columbia. It also invests in power utilities in the United States and the Caribbean region, and owns hotels and commercial real estate. In 2006, the company earned $1.37 a share (total $148.8 million), up 10.5% from $1.24 a share ($137.1 million) in 2005 (the 2005 earnings included an unusual $7.9 million after-tax gain). Most of the higher earnings came from strong growth at its regulated power plants in Western Canada and the Caribbean. Revenue rose 2.1%, to $1.47 billion from $1.44 billion. In the past few years, Fortis has used acquisitions to geographically diversify its operations. Its latest purchase is the regulated gas distribution business of Terasen Inc. (formerly called BC Gas), which supplies gas to over 900,000 customers in British Columbia....