Quality holdings support dividend

Article Excerpt

POWER CORP. $27 (Toronto symbol POW; Conservative-Growth Dividend Payer Portfolio, Finance sector; Shares outstanding: 417.0 million; Market cap: $11.3 billion; Dividend yield: 5.7%; Dividend Sustainability Rating: Above Average; www.powercorporation.com) is a holding company with a diversified list of businesses. Those include 65.6%-owned Power Financial, which in turn holds 67.6% of insurer Great-West Lifeco, and 61.5% of mutual-fund provider IGM Financial. Through its 50% stake in Parjointco, Power Financial also holds 55.5% of Swiss-listed Pargesa Holdings SA. Pargesa has 95% of its assets in seven large European firms. The company raised its quarterly dividend by 6.6% with the June 2018 payment. Investors now receive $0.3820 per share instead of $0.3585. The new annual rate of $1.53 yields a high 5.7%. In the three months ended June 30, 2018, Power Corp.’s earnings per share were unchanged at $0.75. More specifically, Power Financial’s per-share earnings improved 5.7%, but were offset by a loss on investments at the company’s Sagard Capital business. Power Corp. is a buy. buy…

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