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
These two leading supermarket chains continue to expand into new areas. That helps them compete with big U.S. retailers like Wal-Mart and Target, which are aggressively expanding in Canada and selling more groceries. LOBLAW COMPANIES LTD. $35 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 281.4 million; Market cap: $9.8 billion; Price-to-sales ratio: 0.3; Dividend yield: 2.4%; TSINetwork Rating: Above Average; www.loblaw.ca) recently formed a partnership with J.C. Penney (New York symbol JCP). Under this deal, Loblaw will build Joe Fresh casual-clothing boutiques inside 700 of Penney’s 1,100 department stores in the U.S. These outlets should open in April 2013. Penney will also sell Joe Fresh products through its website....
RIOCAN REAL ESTATE INVESTMENT TRUST $28 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 263.4 million; Market cap: $7.4 billion; Price-to-sales ratio: 5.2; Dividend yield: 4.9%; TSINetwork Rating: Average; www.riocan.com) is ending its joint venture with Cedar Shopping Centers (New York symbol CDR). RioCan holds 80% of this venture, which owns 22 malls in the U.S. Under the terms of the deal, RioCan will buy Cedar’s 20% stake in 21 malls, while Cedar will buy RioCan’s 80% stake in another mall. RioCan will pay Cedar $39.0 million. That’s equal to 37% of its second quarter cash flow of $106.0 million, or $0.37 a unit. RioCan is a buy.
BANK OF NOVA SCOTIA $53 (Toronto symbol BNS; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.1 billion; Market cap: $58.3 billion; Price-to-sales ratio: 2.2; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.scotiabank.com) continues to build on its extensive international operations. It recently announced deals with China’s Bank of Xi’an and India’s Kotak Mahindra Bank that make it easier for immigrants, international students and foreign workers to transfer their accounts to Bank of Nova Scotia’s Canadian branches. Once they arrive in Canada, these clients can also apply for credit cards and other services. Bank of Nova Scotia is a buy. TIM HORTONS INC. $50 (Toronto symbol THI; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 154.9 million; Market cap: $7.7 billion; Price-to-sales ratio: 2.6; Dividend yield: 1.7%; TSINetwork Rating: Average; www.timhortons.com) aims to take advantage of fastgrowing interest in home coffee systems....
TORONTO-DOMINION BANK $81 (Toronto symbol TD; Conservative Growth Portfolio, Finance sector; Shares outstanding: 911.7 million; Market cap: $73.8 billion; Price-to-sales ratio: 2.5; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.td.com) earned $1.8 billion in the quarter ended July 31, 2012. That’s up 11.3% from $1.6 billion a year earlier. Earnings per share rose 9.1%, to $1.91 from $1.75, on more shares outstanding. Revenue rose 8.5%, to $5.8 billion from $5.4 billion. Low interest rates continue to spur loan demand. As well, last year’s purchases of MBNA’s Canadian credit card operations and Chrysler Financial, which provides car loans to buyers of Chrysler vehicles, also contributed to the higher earnings. The bank set aside $438 million to cover bad loans in the latest quarter, up 15.3% from $380 million. However, that’s mainly due to the extra loans from the MBNA purchase....
GREAT-WEST LIFECO INC. $22 (Toronto symbol GWO; Conservative Growth Portfolio, Finance sector; Shares outstanding: 949.8 million; Market cap: $20.9 billion; Price-to-sales ratio: 0.7; Dividend Yield: 5.6%; TSINetwork Rating: Above Average; www.greatwestlifeco.com) is Canada’s largest insurance company, with $523.6 billion of assets under administration. It also sells mutual funds and retirement planning and wealth management services. Power Financial Corp. (Toronto symbol PFC) owns 68.2% of Great-West. Top brands are a big plus In Canada, the company sells its products under several well-known banners, including Great West Life, Canada Life and Freedom 55. The Canadian division supplies 51% of Great-West’s earnings....
CANADIAN IMPERIAL BANK OF COMMERCE $77 (www.cibc.com) earned $2.06 a share in the three months ended July 31, 2012. That’s up 6.7% from $1.93 a year earlier. Loan demand remained strong in Canada, and profits rose at the bank’s wealth management and capital markets divisions. The strong results prompted CIBC to raise its quarterly dividend by 4.4%, to $0.94 a share from $0.90. The new annual rate of $3.76 a share yields 4.9%. Buy. CAE INC. $10 (www.cae.com) has won contracts to build flight simulators and upgrade other pilot training equipment for military clients in the U.K., India and Oman. In all, these deals are worth $55 million. That’s equal to 3% of CAE’s annual revenue of $1.9 billion. Best Buy. CANADA BREAD CO. LTD. $44 (www.canadabread.ca) reported that its sales fell 0.3% in the three months ended June 30, 2012, to $404.9 million from $406.2 million a year earlier. That’s mainly because it closed an older bakery in Toronto as part of a restructuring plan. Earnings per share rose 12.4%, to $1.09 from $0.97. However, Maple Leaf Foods continues to hold 90.0% of Canada Bread’s shares. That hurts the stock’s liquidity. Hold.
SHAWCOR LTD., $41.85, Toronto symbol SCL.A, jumped 18% this week after it announced that it will conduct a strategic review of its operations. This could lead to a sale of some of its businesses or the entire company. ShawCor makes sealants and coatings that keep oil and natural gas pipelines from rusting. It also manufactures industrial products, such as electrical wire and protective sheaths. The family of ShawCor’s founder controls the company through multiple-voting shares, which give them 63% of the total votes. It was their desire to sell their holdings that led to the strategic review....
BANK OF NOVA SCOTIA, $52.25, Toronto symbol BNS, has agreed to buy ING Bank of Canada (which operates as ING Direct) from its Netherlands-based parent, ING Group. ING Direct offers a wide variety of no-fee banking services, mainly over the Internet. It has 1.8 million customers and $30 billion in deposits. Bank of Nova Scotia will keep ING Direct as a separate business and will not merge it with its regular banking operations. The bank will pay $3.1 billion for ING Direct when the deal closes in December 2012. However, ING Direct holds cash of $1.2 billion, so the real cost is around $1.9 billion. To fund this purchase, Bank of Nova Scotia plans to sell up to $1.7 billion of common shares for $52.00 each. That would increase the number of shares outstanding by 3%....
TELUS CORP., Toronto symbols T $64.00 and T.A $62.68, has revived its plan to merge its common shares (one vote per share) and its non-voting class A shares into a single class. Under the terms of the proposal, each non-voting share will become one common share. Investors in each share class, voting separately, must approve the plan at a special meeting on October 17, 2012. The company cancelled a vote on the proposal that was scheduled for May 2012 because it felt it had little chance of winning. That’s because U.S.-based hedge fund Mason Capital, which now owns around 19% of Telus’s common shares and a small portion of the non-voting shares, said it would vote against the plan. Mason is using a complex stock-trading strategy that would let it lock in a profit if shareholders reject the proposal....
AGRIUM INC., $98.86, Toronto symbol AGU, rose 2% this week on news that activist investment firm Jana Partners LLC now owns roughly 4% of Agrium’s stock. This is the same company that pressured McGraw-Hill (New York symbol MHP) to split itself into two new firms: one that will produce financial-information products and one that will publish textbooks for colleges and schools. McGraw-Hill is a recommendation of Wall Street Stock Forecaster, our newsletter that focuses on U.S. stocks. Jana now wants Agrium to spin off its retail division as a separate company. These stores sell seed, fertilizer and other products to farmers. They also supply two-thirds of Agrium’s revenue and half of its earnings....