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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BCE INC. $56 (Toronto symbol BCE; Conservative Growth and Income Portfolios, Utilities sector; Shares outstanding: 840.3 million; Market cap: $47.1 billion; Price-to-sales ratio: 2.2; Dividend yield: 4.6%; TSINetwork Rating: Above Average; www.bce.ca) is Canada’s largest telephone provider, with 5.0 million customers in Ontario and Quebec. It also has 2.3 million high-speed Internet users and 2.4 million TV subscribers. This business supplies 46% of BCE’s revenue.
The company also sells wireless services (29% of revenue) to 8.1 million customers across Canada, and its Bell Media segment (13%) owns CTV Television, specialty channels and radio stations.
In November 2014, the company paid $3.95 billion in cash and stock for the 56% of Bell Aliant that it didn’t already own. Bell Aliant, which accounts for the remaining 12% of BCE’s revenue, sells telephone and Internet services to 2.2 million clients in Atlantic Canada and rural Ontario and Quebec.
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The company also sells wireless services (29% of revenue) to 8.1 million customers across Canada, and its Bell Media segment (13%) owns CTV Television, specialty channels and radio stations.
In November 2014, the company paid $3.95 billion in cash and stock for the 56% of Bell Aliant that it didn’t already own. Bell Aliant, which accounts for the remaining 12% of BCE’s revenue, sells telephone and Internet services to 2.2 million clients in Atlantic Canada and rural Ontario and Quebec.
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MOLSON COORS CANADA INC. (Toronto symbols TPX.A $84 and TPX.B $92; Conservative Growth and Income Portfolios, Consumer sector; Shares outstanding: 193.0 million; Market cap: $17.8 billion; Priceto- sales ratio: 3.2; Dividend yield: 2.3%; TSINetwork Rating: Average; www.molsoncoors.com) sold less beer in 2014, but its ongoing cost-control plan continues to give it more cash for debt repayments and dividends.
In 2014, the company’s worldwide beer volumes fell 1.3%. That lowered its revenue by 1.4%, to $4.1 billion from $4.2 billion in 2013 (all amounts except share price and market cap in U.S. dollars). If you disregard currency exchange rates, revenue gained 0.3%.
Molson Coors continues to improve its efficiency. As a result, its earnings rose 5.7%, to $768.5 million from $727.1 million. Per-share earnings gained 4.6%, to $4.13 from $3.95, on more shares outstanding.
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In 2014, the company’s worldwide beer volumes fell 1.3%. That lowered its revenue by 1.4%, to $4.1 billion from $4.2 billion in 2013 (all amounts except share price and market cap in U.S. dollars). If you disregard currency exchange rates, revenue gained 0.3%.
Molson Coors continues to improve its efficiency. As a result, its earnings rose 5.7%, to $768.5 million from $727.1 million. Per-share earnings gained 4.6%, to $4.13 from $3.95, on more shares outstanding.
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CANADIAN TIRE CORP. $118 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 78.1 million; Market cap: $9.2 billion; Price-to-sales ratio: 0.7; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.canadiantire.ca) began operating in 1922 and is now one of Canada’s leading retailers.
The company owns 493 Canadian Tire stores, which sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 300 gas stations and 91 PartSource auto parts stores.
Canadian Tire has acquired more-specialized retailers to help it compete with big U.S.-based chains like Wal-Mart and Home Depot. In 2002, it bought Mark’s Work Wearhouse, which sells casual and work clothing through 383 stores. It later shortened the name to Mark’s as it added more women’s clothing and other merchandise.
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The company owns 493 Canadian Tire stores, which sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 300 gas stations and 91 PartSource auto parts stores.
Canadian Tire has acquired more-specialized retailers to help it compete with big U.S.-based chains like Wal-Mart and Home Depot. In 2002, it bought Mark’s Work Wearhouse, which sells casual and work clothing through 383 stores. It later shortened the name to Mark’s as it added more women’s clothing and other merchandise.
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LOBLAW COMPANIES LTD. $48 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 412.7 million; Market cap: $19.8 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.0%; TSINetwork Rating: Above Average; www.loblaw.ca) is Canada’s largest food retailer, with roughly 1,200 stores. Its banners include Loblaws, Provigo, Fortinos, Real Canadian Superstore and No Frills.
The company recently acquired the 1,250-store Shoppers Drug Mart chain. Loblaw paid $12.3 billion, consisting of $6.6 billion in cash and $5.7 billion in Loblaw common shares. Shoppers shareholders now own 29% of the combined company.
Loblaw’s parent company, George Weston Ltd. (Toronto symbol WN), agreed to help it pay for this acquisition by purchasing $500 million worth of new shares. Due to the extra shares outstanding, Weston now owns 46% of Loblaw, down from 63% prior to the purchase.
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The company recently acquired the 1,250-store Shoppers Drug Mart chain. Loblaw paid $12.3 billion, consisting of $6.6 billion in cash and $5.7 billion in Loblaw common shares. Shoppers shareholders now own 29% of the combined company.
Loblaw’s parent company, George Weston Ltd. (Toronto symbol WN), agreed to help it pay for this acquisition by purchasing $500 million worth of new shares. Due to the extra shares outstanding, Weston now owns 46% of Loblaw, down from 63% prior to the purchase.
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Every Tuesday we bring you “Best Canadian Stocks.” You get our specific recommendations on the stocks we profile, with a full explanation of how we arrived at our opinion. You’ll read about stocks making moves you should know about, from coverage in one of our three newsletters featuring Canadian stocks—The Successful Investor, Stock Pickers Digest and Canadian Wealth Advisor. ENBRIDGE INC. (Toronto symbol ENB; www.enbridge.com) gets 90% of its revenue from pipelines that pump oil and natural gas from Western Canada to Eastern Canada and the U.S. The remaining 10% mainly comes from distributing gas to 2.1 million consumers in Ontario, Quebec, New Brunswick and New York State. Since 2008, Enbridge has spent $20 billion on 39 new pipelines and other projects. Thanks to these investments, the company’s revenue soared 164.1%, from $12.5 billion in 2009 to $32.9 billion in 2013. Its revenue probably increased to $37.7 billion in 2014....
Telus continues to upgrade its wireless and Internet services, spending $2.2 billion on these improvements in 2014. That’s helping it attract more subscribers in a highly competitive market.
As well, last year the company bought $1.1 billion worth of wireless frequencies, or spectrum that should let it cover more of Canada, particularly smaller cities and rural areas.
TELUS (Toronto symbol T; www.telus.com) gets 55% of its revenue from its 8.0 million wireless subscribers across Canada. It also has 3.2 million phone customers, 1.5 million high-speed Internet users and 888,000 TV subscribers.
Telus also continues to expand its health care division, which helps doctors, pharmacies and hospitals convert patient records and other information to electronic formats.
In September 2014, the company paid an undisclosed sum for ZRx Prescriber, an app that lets doctors write prescriptions through their tablet computers and smartphones. The app can also access a patient’s drug-insurance information, which speeds up claims and cuts down on errors. Over 520 clinics in Ontario and Quebec use ZRx Prescriber to process 400,000 prescriptions a month.
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As well, last year the company bought $1.1 billion worth of wireless frequencies, or spectrum that should let it cover more of Canada, particularly smaller cities and rural areas.
TELUS (Toronto symbol T; www.telus.com) gets 55% of its revenue from its 8.0 million wireless subscribers across Canada. It also has 3.2 million phone customers, 1.5 million high-speed Internet users and 888,000 TV subscribers.
Telus also continues to expand its health care division, which helps doctors, pharmacies and hospitals convert patient records and other information to electronic formats.
In September 2014, the company paid an undisclosed sum for ZRx Prescriber, an app that lets doctors write prescriptions through their tablet computers and smartphones. The app can also access a patient’s drug-insurance information, which speeds up claims and cuts down on errors. Over 520 clinics in Ontario and Quebec use ZRx Prescriber to process 400,000 prescriptions a month.
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CGI GROUP INC. $44 (www.cgi.com) has developed a computerized emergency response system for the Estonian government. This service gathers data from several sources and recommends the quickest way to respond to fires and other disasters....
RESTAURANT BRANDS INTERNATIONAL $48 (www.rbi.com) is the new company formed by the merger of Tim Hortons Inc. (old symbol THI) and Burger King Worldwide (old symbol BKW).
Restaurant Brands is the world’s third-largest fast-food chain, after McDonald’s and Yum Brands, with 14,000 Burger King restaurants and 4,590 Tim Hortons outlets in 100 countries. In all, these locations have annual sales of over $23 billion U.S.
Roughly 72% of Tim Hortons shareholders opted to receive 3.0879 shares of the new company for each Tim Hortons share they held. A further 26% chose the default option of $65.50 in cash plus 0.8025 of a Restaurant Brands share, while 2% picked the all-cash option of $88.50 a share.
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Restaurant Brands is the world’s third-largest fast-food chain, after McDonald’s and Yum Brands, with 14,000 Burger King restaurants and 4,590 Tim Hortons outlets in 100 countries. In all, these locations have annual sales of over $23 billion U.S.
Roughly 72% of Tim Hortons shareholders opted to receive 3.0879 shares of the new company for each Tim Hortons share they held. A further 26% chose the default option of $65.50 in cash plus 0.8025 of a Restaurant Brands share, while 2% picked the all-cash option of $88.50 a share.
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SUNCOR ENERGY INC. $35 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.5 billion; Market cap: $52.5 billion; Price-to-sales ratio: 1.2; Dividend yield: 3.2%; TSINetwork Rating: Average; www. suncor.com) gets 40% of its revenue and 65% of its earnings by producing oil and natural gas, mainly at its large Alberta oil sands projects. The remaining 60% of revenue and 35% of earnings come from its four oil refineries and 1,500 Petro-Canada gas stations.
Big merger boosted results
Suncor merged with rival Petro-Canada in 2009, increasing its revenue by 52.2%, from $25.5 billion in 2009 to $38.8 billion in 2011. Lower oil prices cut the company’s revenue to $38.5 billion in 2012. In 2013, Suncor sold most of its Western Canadian natural gas operations for $1 billion. However, higher oil prices offset the lower production, and its revenue rose to $40.3 billion.
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Big merger boosted results
Suncor merged with rival Petro-Canada in 2009, increasing its revenue by 52.2%, from $25.5 billion in 2009 to $38.8 billion in 2011. Lower oil prices cut the company’s revenue to $38.5 billion in 2012. In 2013, Suncor sold most of its Western Canadian natural gas operations for $1 billion. However, higher oil prices offset the lower production, and its revenue rose to $40.3 billion.
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BOMBARDIER INC. (Toronto symbols BBD.A $4.15 and BBD.B $4.14; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $7.1 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.4%; TSINetwork Rating: Average; www.bombardier.com) has won several orders for new regional jets, business jets and turboprop planes. Assuming these customers exercise all of their options, these deals are worth a total of $1.7 billion (all amounts except share prices and market cap in U.S. dollars). That’s equal to 9% of the company’s annual revenue of $19.5 billion.
In addition, Bombardier has received an order for 42 passenger railcars from the operator of a public transit system near Paris, France. This deal is worth $484 million, and the company will begin delivering the trains in 2017.
Bombardier B stock is a buy.
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In addition, Bombardier has received an order for 42 passenger railcars from the operator of a public transit system near Paris, France. This deal is worth $484 million, and the company will begin delivering the trains in 2017.
Bombardier B stock is a buy.
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