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 (www.cae.com) has won several contracts for flight simulators and related equipment from airlines in China, South Korea, Russia and the U.S. In all, these deals are worth $130million, or 6% of the company’s $2.2 billion of annual revenue....
FINNING INTERNATIONAL INC. $22 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding:171.4 million; Market cap: $3.8 billion; Price-to-sales ratio: 0.6; Dividend yield: 3.3%; TSINetwork Rating: Above Average; www.finning.com) started up in1933 and is now the world’s largest dealer of tractors, bulldozers and trucks made by Caterpillar Inc. (New York symbol CAT). It also sells heavy equipment made by other firms. Finning’s clients are mainly in the mining, forest products and construction industries.
Western Canada (B.C., Alberta, Yukon, Northwest Territories and parts of Nunavut) supplied 53%of Finning’s revenue in 2014, followed by South America (Argentina, Chile, Uruguay and Bolivia),which contributed 32%, and the U.K. and Ireland(15%).
Big growth in services
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Western Canada (B.C., Alberta, Yukon, Northwest Territories and parts of Nunavut) supplied 53%of Finning’s revenue in 2014, followed by South America (Argentina, Chile, Uruguay and Bolivia),which contributed 32%, and the U.K. and Ireland(15%).
Big growth in services
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CANADIAN IMPERIAL BANK OF COMMERCE $94 (Toronto symbol CM; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 397.2 million; Market cap: $37.3 billion;Price-to-sales ratio: 3.0; Dividend yield: 4.8%; TSINetwork Rating: Above Average; www.cibc.com) earned $990 million in its fiscal2015 third quarter, which ended July 31, 2015, up 9.0% from $908million a year earlier. Earnings per share gained 9.9%, to $2.45from $2.23, on fewer shares outstanding. Revenue improved 4.9%,to $3.5 billion from $3.4 billion.
CIBC’s main Canadian retail banking operations (61% of the total) reported 8.0% higher profits after approving more loans and setting aside less money to cover potential defaults. Earnings from securities trading (26%) fell 4.3%, as higher employee salaries offset improving trading volumes. Wealth management earnings(13%) gained 15.7%, thanks to rising stock markets, which increased the value of the assets this business administers.
Loan-loss provisions fell 3.1%, to $189 million from $195 million ayear earlier, mainly due to better results from CIBC’s credit card portfolio.
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CIBC’s main Canadian retail banking operations (61% of the total) reported 8.0% higher profits after approving more loans and setting aside less money to cover potential defaults. Earnings from securities trading (26%) fell 4.3%, as higher employee salaries offset improving trading volumes. Wealth management earnings(13%) gained 15.7%, thanks to rising stock markets, which increased the value of the assets this business administers.
Loan-loss provisions fell 3.1%, to $189 million from $195 million ayear earlier, mainly due to better results from CIBC’s credit card portfolio.
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BOMBARDIER INC. (Toronto symbols BBD.A $1.53 and BBD.B $1.46; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 2.2 billion; Market cap: $3.2 billion; Price-to-sales ratio: 0.2; Dividend suspended in February 2015; TSINetwork Rating: Extra Risk; www.bombardier.com) owns 50% of a joint venture in China that has won an order to build 15 high speed passenger trains for that country’s rail system. The company’s share of the $381- million U.S. contract is $190.5 million U.S., or 1% of its annual revenue.
Deals like this enhance the prospects of the railcar division as Bombardier prepares to sell part of it in an initial public offering later this year.
Bombardier is still a hold.
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Deals like this enhance the prospects of the railcar division as Bombardier prepares to sell part of it in an initial public offering later this year.
Bombardier is still a hold.
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MAPLE LEAF FOODS INC. $22 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 140.8 million; Market cap: $3.1 billion; Price-to-sales ratio: 1.0; Dividend yield: 1.5%; TSINetwork Rating: Average; www.mapleleaf.ca) gets 8% of its revenue by exporting packaged meats to the U.S., and the lower Canadian dollar makes these products cheaper to American buyers. The weak dollar also makes imported meats more expensive in Canada.
These benefits come while Maple Leaf takes steps to improve its long-term outlook, including a major restructuring involving closing older plants and shifting their operations to newer facilities. However, it could take a year or more before the company realizes the plan’s full benefits.
Maple Leaf Foods is a hold.
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These benefits come while Maple Leaf takes steps to improve its long-term outlook, including a major restructuring involving closing older plants and shifting their operations to newer facilities. However, it could take a year or more before the company realizes the plan’s full benefits.
Maple Leaf Foods is a hold.
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ANDREW PELLER LTD. $18 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; Shares outstanding: 14.3 million; Market cap: $257.4 million; Price-to-sales ratio: 0.8; Dividend yield: 2.5%; TSINetwork Rating: Above Average; www.andrewpeller.com) is Canada’s second-largest producer of wines, after Constellation Brands.
The company continues to successfully launch new premium priced brands. In the first quarter of its 2016 fiscal year, which ended June 30, 2015, Peller’s sales rose 4.5%, to $83.1 million from $79.5 million a year earlier.
Earnings jumped 67.5%, to $6.7 million, or $0.48 a share, from $4.0 million, or $0.29. Without unusual items, such as losses on hedging contracts Peller uses to lock in foreign exchange rates, earnings gained 40.3%.
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The company continues to successfully launch new premium priced brands. In the first quarter of its 2016 fiscal year, which ended June 30, 2015, Peller’s sales rose 4.5%, to $83.1 million from $79.5 million a year earlier.
Earnings jumped 67.5%, to $6.7 million, or $0.48 a share, from $4.0 million, or $0.29. Without unusual items, such as losses on hedging contracts Peller uses to lock in foreign exchange rates, earnings gained 40.3%.
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MOLSON COORS CANADA INC. (Toronto symbols TPX.A $91 and TPX.B $91; Conservative Growth and Income Portfolios, Consumer sector; Shares outstanding: 185.0 million; Market cap: $16.8 billion; Price-to-sales ratio: 3.0; Dividend yield: 2.4%; TSINetwork Rating: Average; www.molson coors.com) merged its U.S. brewing operations with those of rival SABMiller in July 2008 to form MillerCoors. Each company has a 50% voting interest in this joint venture, but Miller gets 58% of the profits, while Molson Coors gets 42%.
Since the merger, MillerCoors has saved roughly $1 billion by combining plants and distribution networks (all amounts except share price and market cap in U.S. dollars).
In the quarter ended June 30, 2015, lower raw material, packaging and fuel costs increased the company’s share of earnings from MillerCoors by 9.3% from a year earlier. However, unfavourable currency rates cut its Canadian earnings by 5.5% and its European profits by 21.5%. A restructuring in China also increased losses at its international operations by 56.8%.
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Since the merger, MillerCoors has saved roughly $1 billion by combining plants and distribution networks (all amounts except share price and market cap in U.S. dollars).
In the quarter ended June 30, 2015, lower raw material, packaging and fuel costs increased the company’s share of earnings from MillerCoors by 9.3% from a year earlier. However, unfavourable currency rates cut its Canadian earnings by 5.5% and its European profits by 21.5%. A restructuring in China also increased losses at its international operations by 56.8%.
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PRECISION DRILLING CORP. $5.43 (Toronto symbol PD; Aggressive Growth Portfolio, Resource sector; Shares outstanding: 292.9 million; Market cap: $1.6 billion; Price-to-sales ratio: 0.8; Dividend yield: 5.2%; TSINetwork Rating: Extra Risk; www.precisiondrilling.com) provides contract drilling services to land-based oil and gas producers, mainly in North America, through 329 rigs.
Even though low oil and gas prices have slowed drilling activity, demand for Precision’s Super Series rigs remains strong. That’s because these rigs can reach deeper pockets of oil than regular rigs.
The company recently received a order for a new Super Series rig. As a result, it now plans to spend $546 million on new rigs and other upgrades in 2015, up 7.9% from its previous estimate of $506 million.
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Even though low oil and gas prices have slowed drilling activity, demand for Precision’s Super Series rigs remains strong. That’s because these rigs can reach deeper pockets of oil than regular rigs.
The company recently received a order for a new Super Series rig. As a result, it now plans to spend $546 million on new rigs and other upgrades in 2015, up 7.9% from its previous estimate of $506 million.
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BANK OF NOVA SCOTIA $59 (Toronto symbol BNS; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.2 billion; Market cap: $70.8 billion; Price-to-sales ratio: 3.3; Dividend yield: 4.7%; TSINetwork Rating: Above Average; www.scotiabank.com) earned $1.85 billion in its fiscal 2015 third quarter, which ended July 31, 2015, up 2.8% from $1.80 billion a year earlier. Earnings per share rose 3.6%, to $1.45 from $1.40, on fewer shares outstanding.
However, revenue fell 5.6%, to $6.1 billion from $6.5 billion, mainly because the bank sold most of its shares in mutual fund provider CI Financial (Toronto symbol CIX) in 2014.
Earnings at the Canadian banking division (49% of total profits) rose 14.9% on improving loan and deposit growth. The international division (30%) saw its earnings rise 10.5%, thanks to strong loan demand in Latin America and favourable currency exchange rates.
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However, revenue fell 5.6%, to $6.1 billion from $6.5 billion, mainly because the bank sold most of its shares in mutual fund provider CI Financial (Toronto symbol CIX) in 2014.
Earnings at the Canadian banking division (49% of total profits) rose 14.9% on improving loan and deposit growth. The international division (30%) saw its earnings rise 10.5%, thanks to strong loan demand in Latin America and favourable currency exchange rates.
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TECK RESOURCES LTD. $9.15 (Toronto symbol TCK.B; Conservative Growth Portfolio, Resources sector; Shares outstanding: 576.2 million; Market cap: $5.3 billion; Price-to-sales ratio: 0.6; Dividend yield: 3.3%; TSINetwork Rating: Average; www.teck.com) and Goldcorp Inc. (Toronto symbol G) have agreed to merge their copper projects in Chile into a new 50/50 joint venture by the end of 2015.
The new venture will hold Teck’s proposed Relincho mine and Goldcorp’s El Morro project. The two properties are just 40 kilometres apart, so there are plenty of opportunities to cut overlapping costs. For example, the partners plan to transport ore from El Morro to Relincho for processing.
It would cost $3.5 billion U.S. to build these mines and related infrastructure (Teck’s share is $1.75 billion U.S.). However, their combined reserves would last 32 years.
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The new venture will hold Teck’s proposed Relincho mine and Goldcorp’s El Morro project. The two properties are just 40 kilometres apart, so there are plenty of opportunities to cut overlapping costs. For example, the partners plan to transport ore from El Morro to Relincho for processing.
It would cost $3.5 billion U.S. to build these mines and related infrastructure (Teck’s share is $1.75 billion U.S.). However, their combined reserves would last 32 years.
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