The dividend yield is one of the important ratios to calculate for dividend stocks. It is calculated as the total annual dividends paid per share, divided by the current stock price. Movements in the stock price will change the dividend yield. When you’re looking for income-producing stocks, dividend yield is typically your most important consideration. The best companies to invest in for a high dividend yield have strong positions in healthy industries. They also incorporate strong management that makes the right moves to remain competitive in changing marketplaces.
Dividend yields are a sign of investment quality. Some good companies reinvest profit to spur growth instead of paying dividends. But fraudulent and failing companies are hardly ever dividend-paying stocks. So if you only buy stocks that pay dividends, you’ll automatically stay out of almost all the market’s worst stocks.
For a true measure of stability, focus on those companies that have maintained or raised their dividend yields during a recession or stock-market downturn. That’s because these firms leave themselves enough room to handle periods of earnings volatility. By continually rewarding investors, and retaining enough cash to finance their businesses, they also provide an attractive mix of safety, income and growth-and are a big part of a successful long term investment strategy
High dividend yields can be a warning sign, however
When looking for high dividend stocks, you should avoid the temptation of “reaching for yield.” That is, choosing investments purely because they offer a high current yield. That’s because a high yield may signal danger rather than a bargain, if it reflects widespread investor skepticism that a company can keep paying its current dividend. Dividend cuts always undermine investor confidence, and can quickly push down a company’s stock price.
While a high-and safe-yield dividend is generally favourable, be aware that it is only one of many indicators that we look for in a good stock. You need to look at the big picture, so you get a realistic view of a company’s long-term prospects. As well, at TSI Network, we recommend our three-part Successful Investor strategy:
Discover how to put an extra strength in your portfolio with our specific advice on how to identify high-quality dividend stocks. It’s all in our newly updated report. Dividend Paying Stocks: How High Dividend Stocks Can Supercharge Your Income Investing.
LISTEN:
ALTAGAS LTD. $21 (Toronto symbol ALA; Shares outstanding: 267.4 million; Market cap: $5.6 billion; Dividend yield: 10.4%; Takeover Target Rating: Medium; www.altagas.com) processes, transports, stores and markets natural gas for producers. The… Read More
RUSSEL METALS $25.04 (Toronto symbol RUS; TSINetwork Rating: Extra Risk) (905-819-7777; www.russelmetals.com; Shares outstanding: 62.1 million; Market cap: $1.6 billion; Dividend yield: 6.1%) is one of North America’s largest metal distributors. It serves over 28,000 clients at 51 locations in Canada and 12 in the U.S.
In the three… Read More
MAJOR DRILLING $4.90 (Toronto symbol MDI; TSINetwork Rating: Speculative) (1-866-264-3986; www.majordrilling.com; Shares outstanding: 80.3 million; Market cap: $393.5 million; No dividends paid) is a large contract driller that mainly serves the mining industry.
Major believes that mining activity continues to deplete the world’s more easily accessible mineral reserves. That… Read More
DOREL INDUSTRIES $22.37 (Toronto symbol DII.B; TSINetwork Rating: Extra Risk) (514-934-3034; www.dorel.com; Shares outstanding: 32.3 million; Market cap: $725.8 million; Dividend yield: 7.0%) has announced the acquisition of U.K.-based Alphason designs. Established 30 years ago, that firm designs and distributes home office and audio-visual furniture (TV stands and… Read More
ALIMENTATION COUCHE-TARD $61.97 (Toronto symbol ATD.B: TSINetwork Rating: Average) (1-800-361-2612; www.couchetard.com; Shares outstanding: 567.4 million; Market cap: $35.3 billion; Dividend yield: 0.7%) operates 12,701 convenience stores throughout North America and Europe.
In the three months ended July 22, 2018, sales jumped 50.2%, to $14.79 billion from $9.85 billion a.. Read More
NISSAN MOTOR (ADR) $17.95 (Nasdaq symbol NSANY; TSINetwork Rating: Above Average) (310-771-3111; www.nissan-global.com; ADRs o/s: 2.1 billion; Market cap: $38.0 billion; Dividend yield: 3.3%) will now adopt Android infotainment systems by Alphabet’s Google for its next generation of in-car systems and dashboard displays. They launch in 2021.
Drivers will… Read More
WAJAX CORP. $25.29 (Toronto symbol WJX; TSINetwork Rating: Extra Risk) (905-212-3300; www.wajax.ca; Shares outstanding: 20.0 million; Market cap: $506.5 million; Dividend yield: 4.0%) sells and services cranes, forklifts and other heavy equipment. It also provides related parts and systems such as ball bearings, hoses, diesel engines and… Read More
HECLA MINING $3.04 (New York symbol HL; TSINetwork Rating: Extra Risk) (208-769-4100; www.hecla-mining.com; Shares outstanding: 477.0 million; Market cap: $1.5 billion; Dividend yield: 0.3%) explores for, mines and processes both silver and gold in the U.S., Canada and Mexico.
The company has exercised warrants to acquire 1.25 million… Read More
BIRCHCLIFF ENERGY $4.82 (Toronto symbol BIR; TSINetwork Rating: Speculative) (403-261-6401; www.birchcliffenergy.com; Shares outstanding: 263.0 million; Market cap: $1.3 billion; Dividend yield: 2.0%) explores for, develops and produces oil and gas, mainly in the Peace River Arch area of both Alberta and B.C. About 80% of its output is… Read More
BROADRIDGE FINANCIAL SOLUTIONS $118.81 (New York symbol BR; TSINetwork Rating: Average) (201-714-3000; www.broadridge.com; Shares outstanding: 116.3 million; Market cap: $13.8 billion; Dividend yield: 1.6%) serves the investment industry in three main areas: investor communications, securities processing and transaction clearing.
For the quarter ended June 30, 2018, revenue fell… Read More
The Successful Investor Inc. and its affiliate Successful Investor Wealth Management (referred to hereafter as TSI Network) know that you care how information about you is used and shared, and we appreciate your trust that we will do so carefully and sensibly. This notice describes our privacy policy. By visiting websites owned by or associated with TSI Network, you are accepting the practices described in this Privacy Policy.
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We are continuously in the process of improving our sites and services. If any new features or policies require a change to this current policy, we will post a clear notice of this change on pages of our site where the privacy policy appears. The principle behind this privacy policy is to collect information with your knowledge and consent.
What personal information do we collect?
The information we receive from customers helps us personalize and continually improve your online experience at TSI Network. TSI Network may collect personal information online for all legal purposes, which include, but are not limited to:
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Does TSI Network Use the Information It Receives?
"Contact Us" and Comment Features: TSI Network encourages visitors to its websites to contact us with questions and comments. Email addresses and other information of persons using these features may be collected in order to facilitate our responses to those inquiries.
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Changes to this Policy
This Policy is the sole authorized statement of TSI Network's practices with respect to the collection of personal information through TSI Network's websites and the subsequent use and disclosure of such information. Any summaries of this Policy generated by third party software or otherwise (for example, in connection with the "Platform for Privacy Preferences" or "P3P") shall have no legal effect, are in no way binding upon TSI Network, shall not be relied upon in substitute for this Policy, and neither supersede nor modify this Policy.
TSI Network may revise this Policy from time to time.
Legal Notices and Disclaimers
The contents of this web site and our publications are based upon sources of information believed to be reliable, but no warranty or representation, expressed or implied, is given as to their accuracy or completeness. Any opinion reflects the Successful Investor’s judgment at the date of publication and neither the Successful Investor, nor any of its affiliated companies, nor any of their officers, directors or employees, accepts any responsibility in respect of the information or recommendations contained in the publications or on this web site. Moreover, the information or recommendations are subject to change without notice.
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