high dividend
Fortis Inc., symbol FTS on Toronto, is the main supplier of electrical power in Newfoundland and Prince Edward Island. It also operates power plants in other parts of Canada, as well as the U.S., Belize and the Cayman Islands. As well, Fortis operates hotels and other businesses in Canada. Fortis recently raised its quarterly dividend by 3.6%, to $0.29 a share from $0.28. The new annual rate of $1.16 yields 3.5%. The company has been working to lower its reliance on Atlantic Canada. In May 2004, Fortis bought regulated electrical utilities in Alberta and B.C. for $1.5 billion in cash and stock. In May 2007, it paid $3.7 billion for the regulated gas-distribution business of Terasen Inc. (formerly called BC Gas), which has 939,600 customers in B.C. Fortis issued $1.15 billion of new common shares to help pay for this purchase....
Here are three common errors most investors make when stock market investing. All three can seriously hinder your portfolio’s long-term results. (You can get Pat McKeough’s latest lower-risk investing strategies in his new free report, Stock Market Investing Strategy: Pat McKeough’s Conservative Investing Guide for Making Money & Cutting Risk. Click here to download your copy right away.)
- Disregarding subtle signs of high stock market investing risk: These include an unusually high dividend yield or an unusually low p/e (the ratio of a stock’s price to its per-share earnings). High yields and low p/e’s are good, but only within limits....
Investors are paying more attention to dividend yields (a company’s total annual dividends paid per share divided by the current stock price) as 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. A couple of decades ago, you could assume that dividends would contribute up to a third of your long-term investment returns, without even considering the tax-cutting effects of the dividend tax credit. Earlier in this decade, dividend yields were generally too low to provide a third of investment returns. But now that yields have moved up and interest rates have moved down, it’s realistic to assume they will once again contribute as much as a third of your total return....
Demand for wireless services is rising sharply in North America. That’s partly because device makers continue to release new cellphones and wireless devices, such as Apple’s iPad and Amazon’s Kindle e-book reader. As well, more customers are switching from traditional phones (or land lines) to wireless services. Smartphones, in particular, have become increasingly popular. Aside from functioning as mobile phones, these devices have many computer-like functions, including Internet access and email. Apple’s iPhone and Research in Motion’s Blackberry are today’s top-selling smartphones. However, other firms, such as Motorola and Samsung, have introduced new smartphones in recent months, as well....
COMPUTER MODELLING GROUP $25.91 (Toronto symbol CMG; SI Rating: Speculative) (403-531-1300; www.cmgroup.com; Shares outstanding: 18.1 million; Market cap: $467.9 million; Dividend yield: 3.1%) sells software to clients in the oil and gas industry. It also provides consulting services. Computer Modelling’s software helps companies use advanced oil-and-gas recovery techniques to raise output from their existing wells. It has over 360 customers in 50 countries. In the three months ended September 30, 2010, Computer Modelling’s revenue rose 46.8%, to $13.2 million from $9.1 million a year earlier. The company sold more of its software and consulting services to both new and existing customers. Earnings jumped 89.1%, to $4.6 million from $2.4 million. Earnings per share rose 78.6%, to $0.25 from $0.14, on more shares outstanding....
Here are 4 classic errors in stock market strategy that can seriously hinder your returns. All investors make them from time to time. 1. “Averaging down” without reconsidering whether you should have bought in the first place: Many investors have made lots of money by following the stock market strategy of “averaging in” to the stock of a well-established, well-managed company — that is, buying more as funds became available over a period of years. “Averaging down” is different. When you systematically average down (that is, you buy more of a stock you own that has gone down in order to lower your average cost per share), you are zeroing in on your losers....
Smartphones have become increasingly popular in recent years. Aside from functioning as mobile phones, these devices have many computer-like functions, including Internet access and email. There are a couple of ways for investors to profit from rising use of smartphones. The obvious approach is to buy shares of companies that make these devices. Apple and Research in Motion are the most dominant smartphone makers. However, other firms, such as Motorola, Palm and Garmin, have introduced new smartphones in recent months, as well. Another way to profit from rising use of smartphones and other wireless devices is by holding stocks of wireless carriers. Many of these firms have more revenue sources than smartphone makers. Aside from wireless operations, they may provide traditional phone, Internet and television services. This diversity lowers their reliance on a single device. In addition, they get continuing revenue from their customers. This cuts their risk....
Cellcom Israel (ADR), $26.07, symbol CEL on New York (Shares outstanding: 98.4 million; Market cap: $2.6 billion), is the leading Israeli cellular provider. Established in 1994, Cellcom provides its roughly 3.313 million subscribers (as of March 31, 2010) with a range of services, including cellular and land-line telephones, and roaming services (both for its clients when they’re abroad and for tourists in Israel). It also provides downloads, including music, video and mobile-office applications. In the three months ended March 31, 2010, Cellcom’s earnings fell 9%, to $85 million (all amounts in U.S. dollars), or $0.85 a share. Its revenue rose 1.2%, to $426 million. Cellcom trades at 7.7 times its earnings, based on the latest quarter. It also yields a very high 12.8%. However, its earnings growth, and the cash flow it needs to pay that high dividend, could slow as a result of regulatory changes in the Israeli cellphone market....
CRESCENT POINT ENERGY CORP. $38.44 (Toronto symbol CPG; Shares outstanding: 211.7 million; Market cap: $8.1 billion; SI Rating: Extra Risk; Dividend yield: 7.2%) produces oil and natural gas in western Canada. Its average daily production of 56,061 barrels of oil equivalent (including natural gas) is weighted 89% toward gas and 11% to oil. The company continues to focus on its light-oil Bakken development in southeastern Saskatchewan. Crescent Point plans to spend at least $750 million on exploration and development this year. As well, the company has agreed to buy the 79% of privately held Shelter Bay Energy that it doesn’t already own for $1.1 billion in shares. Shelter Bay’s production is mostly from the Bakken area, and will Crescent Point’s output by about 10%....
Whether you’re an aggressive or more conservative investor, we feel you can improve your results in stock market investments — and cut your risk — by understanding and avoiding these 5 common investment errors: 1. Focusing on three or fewer of the 5 main economic sectors: Manufacturing and Resources stocks expose you to above-average risk, Utilities and Canadian Finance stocks involve below-average risk, and Consumer stocks fall in the middle. The sectors go in and out of investor favour, depending on economic conditions and investor whim. But in the long run, winners and losers appear in all five. Spreading your money out across most or all of the five sectors limits the role of luck in your results. Your stock market investments will always have some exposure to the year’s most profitable investment area, and that’s a key factor in successful investing....