Credit quality remains strong

Article Excerpt

CANADIAN TIRE CORP. (class A non-voting) is a buy. The retailer (Toronto symbols CTC (voting) $267 and CTC.A (non-voting) $151; Conservative Growth Payer Portfolio, Consumer sector; Shares outstanding: 59.0 million; Market cap: $8.9 billion; Dividend yield: 4.3%; Dividend Sustainability Rating: Highest; www.canadiantire.ca) raised your quarterly dividend by 25.0%. Starting with the September 2022 payment, investors now receive $1.625 a share instead of $1.30. The new annual rate of $6.50 yields 4.3%. In response to rising interest rates, Canadian Tire raised its loan-loss provisions at its credit card business in the second quarter of 2022 by 7.0%. However, despite more cardholders and higher balances, the loan write-off rate improved to 4.1% from 4.8% a year earlier. The company will probably earn $18.69 a share in 2022, and the stock trades at a low 8.1 times that forecast. Canadian Tire is a buy. buy…