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
INDIGO BOOKS & MUSIC INC. $9.12 (Toronto symbol IDG; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 25.2 million; Market cap: $229.8 million; Price-to-sales ratio: 0.2; Dividend yield: 4.8%; TSINetwork Rating: Average; www.chapters.indigo.ca) has agreed to sell Kobo Inc., which sells electronic books and reader devices. Indigo owns 51.4% of Kobo. Japanese e-commerce company Ratuken Inc. will pay $315 million U.S. for 100% of Kobo. Indigo will receive $140 million U.S. to $150 million U.S. when the sale closes in early 2012. That’s equal to two-thirds of its market cap. Sales of e-books are growing strongly. Indigo will keep selling Kobo products through its bookstores and web site, however, the Kobo reader is no match for Amazon’s Kindle....
PENGROWTH ENERGY CORP. $10 (Toronto symbol PGF; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 330.1 million; Market cap: $3.3 billion; Price-to sales ratio: 2.4; Dividend yield: 8.4%; TSINetwork Rating: Average; www.pengrowth.com) produced an average of 74,568 barrels of oil equivalent per day (including natural gas) in the third quarter of 2011. That’s up 2.6% from 72,704 barrels a year earlier. Production was weighted 51% to oil and 49% to natural gas. Cash flow rose 0.7%, to $150.4 million from $149.3 million. However, cash flow per share fell 8.0%, to $0.46 from $0.50, on more shares outstanding. Pengrowth is drilling more wells on its properties in Alberta. As a result, it now expects to spend $610 million on capital projects in 2011. That’s $60 million more than its earlier forecast. The company will fund this expansion by selling $300 million of new shares. That will increase the total outstanding by about 9%....
ENCANA CORP. $20 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.3 million; Market cap: $14.7 billion; Price-to-sales ratio: 1.9; Dividend yield: 4.1%; TSINetwork Rating: Average; www.encana.com) has agreed to sell some of its natural gas properties in northern Texas for $975 million (all amounts except share price and market cap in U.S. dollars). To put that in context, Encana earned $171 million, or $0.23 a share, in the three months ended September 30, 2011. The sale is part of Encana’s ongoing plan to focus on its main properties in Alberta, B.C., Wyoming, Colorado and Louisiana. Including this sale, Encana has sold $1.7 billion of properties in 2011. That’s within its target of $1 billion to $2 billion....
Loblaw and Metro continue to face strong competition from larger retailers, like Wal-Mart, which are expanding their grocery sales. However, both companies have improved their prospects by launching attractive new products and expanding into profitable niche markets. LOBLAW COMPANIES LTD. $39 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 282.3 million; Market cap: $11.0 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.2%; TSINetwork Rating: Above Average; www.loblaw.ca) is Canada’s largest food retailer, with about 1,000 company-owned and franchised stores. In the quarter ended June 18, 2011, Loblaw’s revenue rose just 0.1%, to $7.28 billion from $7.27 billion a year earlier. However, same-store sales fell 0.4%. Higher sales of clothing and fuel offset flat food sales....
ENBRIDGE INC. $35 (Toronto symbol ENB; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 774.5 million; Market cap: $27.1 billion; Price-to-sales ratio: 1.5; Dividend yield: 2.8%; TSINetwork Rating: Above Average; www.enbridge.com) is buying 50% of a 300-megawatt wind power project northeast of Quebec City. This investment will cost Enbridge $330 million, or 25% of the $1.3 billion, or $1.75 a share, of cash flow that it reported for the first half of 2011. Wind farms are uneconomic, but operators profit from subsidies. This project has a 20-year deal to sell its power to Hydro-Quebec. Enbridge is a buy.
CANADIAN NATIONAL RAILWAY CO. $79 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 444.8 million; Market cap: $35.1 billion; Price-to-sales ratio: 4.0; Dividend yield: 1.6%; TSINetwork Rating: Above Average; www.cn.ca) will buy back up to 5.65 million of its common shares from a private seller, at a discount to their market price. It aims to complete these purchases by March 2012. This is part of CN’s plan to buy back 17 million of its shares, or 3.8% of the total outstanding, by October 27, 2012. Share buybacks raise earnings per share and other per-share calculations, and give the remaining shareholders a larger stake in the company. CN Rail is a buy....
TELUS CORP. (Toronto symbols T $54 and T.A $51; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 324.5 million; Market cap: $17.5 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.telus.com) continues to benefit from rising demand for smartphones, like the iPhone and devices that run Google’s Android operating system. In the three months ended September 30, 2011, Telus added 114,000 new wireless subscribers, net of deactivations. That’s down 25.5% from 153,000 a year earlier. However, 70% of these new long-term customers use smartphones. That pushed up demand for data services, such as web browsing. As a result, Telus’s revenue rose 6.5% in the quarter, to $2.6 billion from $2.5 billion a year earlier. Earnings rose 29.9%, to $326 million from $251 million. Earnings per share rose 28.2%, to $1.00 from $0.78, on more shares outstanding....
RIOCAN REAL ESTATE INVESTMENT TRUST $25 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 269.6 million; Market cap: $6.7 billion; Price-to-sales ratio: 5.3; Dividend yield: 5.5%; TSINetwork Rating: Average; www.riocan.com) is Canada’s largest real estate investment trust (REIT). It specializes in big-box-style outdoor malls, and owns 314 retail properties, 10 of which are under development. Most are in suburban areas, where land is generally cheaper than in towns and cities. RioCan also owns 38 malls in the U.S. through a joint venture with Cedar Shopping Centers, Inc. (New York symbol CDR). The trust owns 80% of this joint venture, as well as 14.3% of Cedar. RioCan often leaves room at its malls for expanding existing stores, and building new ones. This makes its easy to add more tenants....
BCE INC. $39 (www.bce.ca) earned $0.93 a share in the quarter ended September 30, 2011, up 14.8% from $0.81 a year earlier. That’s partly due to BCE’s April 2011 purchase of CTVglobemedia, the private company that owns CTV Television and other media properties. Strong demand for wireless services and its new Internet-based TV service also spurred results. Best Buy. BELL ALIANT INC. $28 (www.aliant.ca) continues to benefit from its investments in its high-speed Internet networks in Atlantic Canada. As a result, earnings per share in the third quarter of 2011 improved to $0.41 from a loss of $0.01 a year earlier. Buy. FORTIS INC. $33 (www.fortisinc.com) earned $0.31 a share in the third quarter of 2011. However, if you exclude a break-up fee that Fortis received only because a Vermont electricity distributor accepted a competing takeover offer, per-share earnings would have fallen by 3.8%, to $0.25 from $0.26 a year earlier. Hold.
TRANSCANADA CORP., $42.37, Toronto symbol TRP, is still waiting for final approval to proceed with its proposed Keystone XL oil pipeline. Keystone XL includes the third and fourth phases of a four-phase, $13-billion U.S. project; phases one and two are already pumping crude oil from the Alberta oil sands to refineries in the U.S. Midwest. Keystone XL will cost $7 billion U.S., and will pump oil from Alberta through Oklahoma to the U.S. Gulf Coast. So far, TransCanada has spent $1.9 billion U.S. on Keystone XL. The U.S government should make a final decision by the end of 2011. If the pipeline is approved, TransCanada expects to complete it in the second half of 2013....