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
CP’s earnings have suffered lately, mainly due to bad weather. Avalanches during the winter disrupted its operations in western Canada, and spring floods washed out some of its lines in the Canadian Prairies and the U.S. Midwest. However, these are short-term setbacks. As well, the company is now working on a number of improvements that should make it more efficient, and push up its profits. CP’s upgrades mainly include improving its tracks and expanding its loading facilities so they can handle longer trains. That will extend the lives of CP’s locomotives, because they will have to make fewer stops and starts. These improvements will also help the company profit as shipping volumes rise....
TRANSCANADA CORP. $43 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 703.0 million; Market cap: $30.2 billion; Price-to-sales ratio: 3.5; Dividend yield: 3.9%; TSINetwork Rating: Above Average; www.transcanada.com) continues to face strong opposition from environmentalists and celebrities over its proposed Keystone XL pipeline, which would pump crude oil from Alberta’s oil sands to refineries on the U.S. Gulf Coast. (Keystone XL is the third and fourth phases of the four-phase Keystone project; the first two phases are already pumping oil from Alberta to the U.S. Midwest.) These activists oppose the development of the oil sands, due to concerns that they will produce large amounts of greenhouse gases, and contribute to global warming. They also worry that the pipeline could leak and contaminate underground water tables. However, it’s looking more likely that Keystone XL will be built. As the pipeline crosses an international border, the U.S. State Department must approve the project. It recently concluded that Keystone XL will have no significant impact on the environment....
BCE, Telus and Manitoba Telecom are facing rising competition from cable companies, as well as new entrants in the wireless market. However, all three companies have spent heavily on their wireless and high-speed Internet networks in the past few years. That’s letting them launch new services, like Internet-based TV. The extra cash flows from these services should let all three firms raise their already high dividends. BCE INC. $39 (Toronto symbol BCE; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 777.5 million; Market cap: $30.3 billion; Price-to-sales ratio: 1.6; Dividend yield: 5.3%; TSINetwork Rating: Above Average; www.bce.ca) is Canada’s largest provider of telephone, Internet and wireless services. The company’s main subsidiary, Bell Canada, has 6.3 million residential and business customers in Ontario and Quebec....
BELL ALIANT INC. $27 (Toronto symbol BA, Conservative Growth Portfolio, Utilities sector; Shares outstanding: 227.8 million; Market cap: $6.2 billion; Price-to-sales ratio: 1.0; Dividend yield: 7.0%; TSINetwork Rating: Above Average; www.bellaliant.ca) sells telephone and Internet services to 2.8 million customers in Atlantic Canada, as well as rural parts of Ontario and Quebec. The company also sells wireless services through an alliance with BCE. Sales of the company’s Internet and TV services are rising. That’s offsetting lower sales from its local and long-distance telephone operations. In the three months ended June 30, 2011, Bell Aliant earned $0.43 a share (the company did not provide comparable year-earlier figures, because it was an income trust)....
CANADIAN IMPERIAL BANK OF COMMERCE $77 (Toronto symbol CM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 398.9 million; Market cap: $30.7 billion; Price-to-sales ratio: 1.9; Dividend yield: 4.7%; TSINetwork Rating: Above Average; www.cibc.com) earned $808 million, or $1.89 a share, in the three months ended July 31, 2011. That’s up 26.3% from $640 million, or $1.53 a share, a year earlier. Revenue rose 7.3%, to $3.1 billion from $2.8 billion. Most of these gains came from CIBC’s main retail-banking business, which continues to see strong demand for loans as a result of low interest rates. Retail banking now accounts for 77% of CIBC’s business, up from 74% a year earlier. As well, more borrowers are paying back their loans on time. That’s letting CIBC set aside less money to cover bad loans: the bank’s loan-loss provisions fell 11.8% in the quarter, to $195 million from $221 million a year earlier. Thanks to its improving outlook, CIBC has raised its dividend for...
FINNING INTERNATIONAL INC. $25 (Toronto symbol FTT; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 171.6 million; Market cap: $4.3 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.finning.com) sells, rents and repairs heavy equipment, such as tractors, bulldozers and trucks, made by Caterpillar Inc. Finning’s major customers are in the mining, forest-products and construction industries in western Canada, the U.K. and South America. Rising prices for oil, gold and other commodities continue to spur demand for Finning’s equipment and maintenance services. In the three months ended June 30, 2011, the company’s earnings rose 129.4% to $81.9 million, or $0.48 a share. A year earlier, it earned $35.7 million, or $0.21 a share. Revenue rose 39.0% to $1.5 billion from $1.1 billion. That’s mainly because sales of new equipment rose 68.4%, to $689.2 million. Revenue from support services rose 24.2%, to a record $635.7 million....
Both Great-West Lifeco and IGM Financial sell mutual funds and wealth-management services. The companies’ fees vary with the value of the assets they manage, so both stocks have moved down due to recent stock-market volatility. Even so, we still like their long-term prospects. GREAT-WEST LIFECO INC. $22 (Toronto symbol GWO; Conservative Growth Portfolio, Finance sector; Shares outstanding: 949.5 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 $497.0 billion of assets under administration. That’s up 7.2% in the past year. Great-West also sells retirement-planning and wealth-management services. Canada accounts for 49% of its earnings, followed by Europe (27%) and the U.S. (24%). In the three months ended June 30, 2011, Great-West’s earnings rose 15.6%, to $526 million, or $0.55 a share. A year earlier, it earned $455 million, or $0.48 a share. However, revenue fell 3.8%, to $7.1 billion from $7.4 billion, due to fewer gains from its investment portfolio....
PRECISION DRILLING CORP. $13 (Toronto symbol PD; Aggressive Growth Portfolio, Resource sector; Shares outstanding: 275.7 million; Market cap: $3.6 billion; Price-to-sales ratio: 2.3; No dividends paid since February 2009; TSINetwork Rating: Extra Risk; www.precisiondrilling.com) has reached an agreement with the Canada Revenue Agency (CRA) on taxes the company owes on a 2005 transaction....
EMERA INC. $32 (Toronto symbol EMA; Income Portfolio, Utilities sector; Shares outstanding: 121.9 million; Market cap: $3.9 billion; Price-to-sales ratio: 1.3; Dividend yield: 4.2%; TSINetwork Rating: Average; www.emera.com) gets 60% of its revenue and 50% of its earnings from Nova Scotia Power Inc., which is Nova Scotia’s main electricity supplier. It gets the rest of its revenue and earnings from its investments in pipelines and power companies in the U.S. and Caribbean. In the three months ended June 30, 2011, Emera’s revenue rose 37.3%, to $500.8 million from $364.7 million a year earlier. The company bought a controlling interest in the main power provider in Barbados in December 2010; the contribution from these operations was the main reason for the higher revenue. Earnings rose 15.0%, to $29.9 million from $26.0 million. Earnings per share rose just 4.3%, to $0.24 from $0.23, on more shares outstanding. The year-earlier earnings figures exclude a one-time gain related to an acquisition. Emera is a buy....
ENBRIDGE INC. $32 (Toronto symbol ENB; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 776.4 million; Market cap: $24.8 billion; Price-to-sales ratio: 1.4; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.enbridge.com) continues to win support from shippers for its proposed Northern Gateway pipeline, which would pump crude oil from Edmonton to a storage terminal in Kitimat, B.C. From there, the oil would be loaded onto tankers and shipped to Asia. Oil-sands operators have already pledged $100 million to the pipeline, which could cost $5.5 billion to build. Northern Gateway still faces strong opposition from environmentalists and Aboriginal groups, but if regulators approve, it could begin operating in 2017. Enbridge is a buy.