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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Dividend Stocks Library Archive
CENOVUS ENERGY INC. $18 (Toronto symbol CVE; Conservative Growth Portfolio, Resources sector; Shares outstanding: 833.2 million; Market cap: $15.0 billion; Price-to-sales ratio: 1.2; Dividend yield: 1.1%; TSINetwork Rating: Average; www.cenovus.com) owns oil sands projects and conventional wells in Western Canada. It ships its oil to its 50%-owned refineries in Illinois and Texas. Due to low oil prices, Cenovus has shrunk its workforce by 31% since the start of 2015. These cuts should save it $200 million this year; it lost $403 million, or $0.49 a share, in 2015. The cuts should also help Cenovus quickly expand profits when oil prices recover. Cenovus is still a buy.
ANDREW PELLER LTD. (Toronto symbols ADW.A $28 and ADW.B $30; Income Portfolio, Consumer sector; Shares outstanding: 14.3 million; Market cap: $406.4 million; Price-to-sales ratio: 1.2; Dividend yield: 1.6%; TSINetwork Rating: Above Average; www.andrewpeller.com) is Canada’s second-largest wine producer, after Constellation Brands. It accounts for 14.2% of the country’s wine sales, and 37.1% of wines produced in Canada. Peller continues to benefit from strong sales of its premium-priced brands. These include its 2011 deal with hockey star Wayne Gretzky to make and distribute wines under his name. This brand is now one of the best-selling wines in Canada. To keep up with strong demand for Gretzky wines, the company is building a new winery next to its existing operation in the Niagara region of Southern Ontario. This new facility will open in the spring of 2017....
Bombardier and BlackBerry (see box) continue to struggle with strong competition and shrinking sales. However, both are developing new products that should spur growth. As well, their sizable cash holdings help cut their short-term risk. BOMBARDIER INC. (Toronto symbols BBD.A $1.52 and BBD.B $1.43; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $2.3 billion; Priceto- sales ratio: 0.2; Dividend suspended in February 2015; TSINetwork Rating: Speculative; www.bombardier.com) is the world’s third-largest maker of commercial aircraft, after Boeing and Airbus. It’s also a leading maker of passenger railcars. The company recently formed a joint venture with the government of Quebec to build its new CSeries passenger jets....
BLACKBERRY LTD. $9.21 (Toronto symbol BB; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 521.2 million; Market cap: $4.8 billion; Price-to-sales ratio: 2.0; No dividends paid; TSINetwork Rating: Speculative; www.blackberry.com) provides secure wireless communication services, mainly to businesses and government agencies. In the fiscal year ended February 29, 2016, BlackBerry’s revenue fell 35.2%, to $2.2 billion from $3.3 billion a year earlier (all amounts except share price and market cap in U.S. dollars). Smartphones supplied 40% of total revenue, followed by the fees it charges wireless carriers to access its networks (37%). The software it installs on its clients’ email servers contributed 23% of revenue. Without unusual items, the company lost $0.19 a share, compared to a profit of $0.08 in 2014. BlackBerry holds cash of $2.6 billion, or $5.03 a share. Its longterm debt of $1.3 billion is a manageable 27% of its market cap....
CAE INC. $15 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 269.9 million; Market cap: $4.0 billion; Price-to-sales ratio: 1.6; Dividend yield: 2.0%; TSINetwork Rating: Average; www.cae.com) is a leading maker of flight simulators and operator of pilot-training schools in over 30 countries. The company recently won several contracts for flight simulators and related equipment from military clients in Canada, the U.S., the U.K. and Australia. In all, these deals are worth $175 million, or 7% of the company’s $2.4 billion of annual revenue. CAE’s military businesses supply 35% of its sales. That cuts its reliance on cyclical commercial airlines....
TORONTO-DOMINION BANK $55 (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.9 billion; Market cap: $104.5 billion; Price-to-sales ratio: 3.3; Dividend yield: 4.0%; TSINetwork Rating: Above Average; www.td.com) is the first Canadian bank to use Visa’s new tokenization technology in its mobile banking app. This system uses encrypted “tokens” instead of credit card numbers and other account information. This helps protect clients’ sensitive information from online intruders. It also speeds up mobile payments and other transactions. Better security should encourage more of TD’s customers to do their banking online. That would cut its costs, as electronic transactions are cheaper to process than those in physical branches....
CANADIAN TIRE CORP. (Toronto symbols CTC $197 and CTC.A $135; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 73.5 million; Market cap: $10.1 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.7%; TSINetwork Rating: Above Average; www.canadiantire.ca) owns 498 Canadian Tire stores. They sell automotive, household and sporting goods. Franchisees run most of these outlets. Other operations include 296 gas stations and 91 PartSource auto parts stores. New markets have paid off Canadian Tire has acquired two big specialty retailers in the past few years: Mark’s sells casual and work clothing through 380 stores; and the Forzani Group sells sporting goods and athletic wear through 433 stores, including Sport Chek and Sports Experts....
SNC-LAVALIN GROUP INC. $47 (www.snclavalin.com) acquired U.K.-based Kentz Corp. for $2.1 billion in August 2014. Kentz sells engineering and construction services to oil and gas firms. The purchase is helping SNC win more contracts in the Middle East....
FORTIS INC., $39.86, Toronto symbol FTS, owns electrical utilities across Canada and in the U.S. and the Caribbean. It also distributes natural gas in British Columbia. The company has completed its latest acquisition in northern B.C.—a 93.8% stake in the Aitken Creek natural gas storage facility. Fortis paid Chevron Corp (New York symbol CVX) $266 million U.S. for the underground complex. To put that in context, Fortis earned $589 million, or $2.11 a share, in 2015. BP Canada owns the remaining 6.2% stake in the B.C. facility. Currently, Fortis leases one-third of Aitken Creek’s capacity. Owning this facility should reduce the company’s costs....
TRANSCANADA CORP., $49.59, Toronto symbol TRP, recently agreed to buy Texas-based Columbia Pipeline Group (New York symbol GPCX) for $13 billion U.S. That’s equal to 48% of its market cap of $35.1 billion (Canadian). Columbia operates natural gas pipelines in the U.S. Northeast, Midwest, Mid-Atlantic and Gulf Coast regions, as well as underground gas storage terminals. To help pay for this acquisition, TransCanada has sold 96.6 million subscription receipts at $45.75 a share for total proceeds of $4.4 billion. Each receipt will convert to one common share when TransCanada completes the Columbia acquisition, probably by the end of 2016. If it fails to complete the acquisition, the funds will be returned to the subscribers. In the meantime, the holders of these receipts will receive the same dividends as holders of the company’s common shares....