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
CANADIAN PACIFIC RAILWAY CO., $63.80, Toronto symbol CP, reported higher revenue in its latest quarter. However, earnings fell short of the consensus estimate. In the three months ended September 30, 2011, CP’s revenue rose 4.3%, to $1.34 billion from $1.29 billion. That’s mainly because the company raised its shipping rates and fuel surcharges. In addition, CP shipped more coal and potash during the quarter; that offset lower volumes of manufactured goods and grain. Even with the higher revenue, earnings fell 5.3%, to $186.8 million, or $1.10 a share. That missed the consensus estimate of $1.11 a share. However, costs related to the early repayment of long-term notes cut earnings by $0.04 a share in the latest quarter. A year earlier, the company earned $197.3 million, or $1.17 a share....
BANK OF NOVA SCOTIA, $51.73, Toronto symbol BNS, has agreed to buy 51% of Banco Colpatria, Colombia’s fifth-largest bank, with 175 branches and 308 automated teller machines. Bank of Nova Scotia will pay $500 million U.S. plus 10 million common shares. That gives the deal a value of roughly $1 billion U.S., which is equal to 85% of the $1.2 billion (Canadian), or $1.11 a share, that the bank earned in the three months ended July 31, 2011. After the deal closes in December 2011, Bank of Nova Scotia will merge its existing wholesale banking operations in Colombia, which focus on corporate clients, with Banco Colpatria....
RESEARCH IN MOTION LTD., $24.26, Toronto symbol RIM, fell slightly this week, because of technical problems that stopped or slowed the delivery of emails to BlackBerry smartphone users. The outage also disrupted the company’s popular BlackBerry Messenger instant-messaging service. It did not affect voice calls.
The problems began when a critical part of RIM’s infrastructure in Europe failed. An automatic backup system also failed. The outage eventually spread to other parts of the world, including Africa, Asia and North America.
Unlike other smartphone companies, RIM compresses and encrypts email and messages before sending it through carrier networks. That makes its systems more secure, and relieves the load on wireless carriers. Still, wireless carriers that have offered refunds to their customers may seek compensation from RIM.
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The problems began when a critical part of RIM’s infrastructure in Europe failed. An automatic backup system also failed. The outage eventually spread to other parts of the world, including Africa, Asia and North America.
Unlike other smartphone companies, RIM compresses and encrypts email and messages before sending it through carrier networks. That makes its systems more secure, and relieves the load on wireless carriers. Still, wireless carriers that have offered refunds to their customers may seek compensation from RIM.
...
Maple Leaf Foods and its subsidiary, Canada Bread, are in the middle of multi-year restructuring plan. A big part of this restructuring involves closing smaller plants and moving their operations into larger facilities with better machinery. The plan’s cost has held back Maple Leaf’s earnings and share price. However, these moves will cut its costs, and help it better deal with rising prices for raw materials, such as pork, wheat and corn, as well as the higher Canadian dollar, which has hurt exports. In addition, the resulting productivity improvements will help it compete with large multinational food producers. We like both companies, but Maple Leaf offers better value. At its current price, its stake in Canada Bread is worth roughly $7.20 per Maple Leaf share. That means you get Maple Leaf’s meat-processing operations, which account for nearly two-thirds of its revenue, for just $3.80 a share....
ENCANA CORP. $21 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.3 million; Market cap: $15.4 billion; Price-to-sales ratio: 1.9; Dividend yield: 3.9%; TSINetwork Rating: Average; www.encana.com) is down 29% since the start of 2011. The company is partly a victim of its own success. Encana was an early pioneer in the development of unconventional gas reserves such as shale gas, which is natural gas that is trapped in rock formations. New technologies that Encana helped develop have cut the cost of extracting shale gas, which has let other companies expand their own shale gas production. This has greatly added to the supply of natural gas, and pushed down gas prices. However, like most commodities, gas prices are inherently volatile. In particular, one cold winter could quickly push up prices....
Media companies continue to face a number of challenges, including the slowing economy, which is hurting advertising revenue, and the explosion of free information available on the Internet. However, we feel high-quality information providers like these three will adapt and thrive. All three are market leaders, and they own some the industry’s best-known brands. What’s more, they are building strong Internet businesses of their own, and doing a good job of controlling their costs. These moves will help them increase their earnings, and give them more cash for dividends. THOMSON REUTERS CORP. $29 (Toronto symbol TRI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 836.8 million; Market cap: $24.3 billion; Price-to-sales ratio: 1.7; Dividend yield: 4.5%; TSINetwork Rating: Above Average; www.thomsonreuters.com) has two main divisions: Markets (which supplied 57% of Thomson Reuters’ 2010 revenue and 48% of its earnings), sells news and information products to banks and other financial institutions. Professional (43%, 52%) sells information to professionals in the legal, taxation, accounting and scientific research fields....
RESEARCH IN MOTION INC. $24 (Toronto symbol RIM; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 524.1 million; Market cap: $12.6 billion; Price-to-sales ratio: 0.6; No dividends paid; TSINetwork Rating: Above Average; www.rim.com) is paying an undisclosed sum for Dublin, Ireland-based NewBay. This privately held firm makes software that helps wireless network carriers deliver messages, video and appointment reminders to smartphones, tablet computers and other mobile devices. NewBay’s clients include AT&T, Verizon, T-Mobile and Deutsche Telekom. NewBay’s expertise should help RIM develop more Internet-based (or cloud) services, which let users store and access music, photos and other content a centralized server. For example, RIM recently launched BBM Music, a new cloud-based music-streaming service for the company’s BlackBerry smartphones. RIM is a buy.
ANDREW PELLER LTD. $8.99 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; Shares outstanding: 14.3 million; Market cap: $128.6 million; Price-to-sales ratio: 0.5; Dividend yield: 4.0%; TSINetwork Rating: Above Average; www.andrewpeller.com) is Canada’s second-largest wine producer, after Vincor Canada. In its 2012 first quarter, which ended June 30, 2011, Peller’s sales rose 7.7%, to $69.4 million from $64.5 million a year earlier. The company launched a number of new products, and is seeing rising demand for its more-profitable premium brands. That offset higher taxes on wines sold in its Ontario stores and slower sales of its home winemaking kits. Peller’s earnings fell 2.3%, to $3.9 million from $4.0 million. Earnings per share were unchanged at $0.28. The drop was mainly due to losses on hedging contracts that the company uses to lock in foreign-exchange rates. If you exclude all unusual items, earnings would have jumped 26.9%....
DUNDEE CORP. $23 (Toronto symbol DC.A; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 64.8 million; Market cap: $1.5 billion; Price-to-sales ratio: 4.3; No dividends paid; TSINetwork Rating: Average; www.dundeecorp.com) is a holding company with subsidiaries in three main areas: wealth management, real estate and resources. The Goodman family controls 83.3% of the company’s votes through multiple-voting shares. In February 2011, Dundee sold its 48% stake (60% voting interest) in DundeeWealth Inc. to Bank of Nova Scotia (Toronto symbol BNS). DundeeWealth owns the Dynamic family of mutual funds. Dundee Corp. still provides investment-management and brokerage services through 48%-owned Dundee Capital Markets Inc. (Toronto symbol DCM). Dundee Corp. received roughly $1.4 billion of Bank of Nova Scotia common and preferred shares for its DundeeWealth stake. As a result of this sale, Dundee Corp.’s revenue fell 20.2% in the three months ended June 30, 2011, to $123.6 million from $154.9 million a year earlier. Earnings fell 32.5%, to $24.3 million, or $0.27 a share, from $36.0 million, or $0.44 a share....
The slowing global economy will likely prompt airlines to spend less on new planes and simulators. However, both Bombardier and CAE operate other businesses that help diversify their operations and cut their exposure to the cyclical air-travel industry. BOMBARDIER INC. (Toronto symbols BBD.A $4.10 and BBD.B $4.01; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $6.8 billion; Price-to-sales ratio: 0.4; Dividend yield: 2.4%; TSINetwork Rating: Average; www.bombardier.com) is the world’s third-largest commercial-aircraft maker, behind Boeing and Airbus. It is also the world’s largest passenger railcar manufacturer. In the three months ended July 31, 2011, Bombardier’s earnings rose 56.7%, to $210 million, or $0.12 a share (all amounts except share prices and market cap in U.S. dollars). A year earlier, it earned $134 million, or $0.07 a share. Sales rose 17.4% to $4.7 billion from $4.0 billion....