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
SUNCOR ENERGY INC. $30 (Toronto symbol SU; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.6 billion; Market cap: $48.0 billion; Price-to-sales ratio: 1.2; Dividend yield: 1.5%; TSINetwork Rating: Average; www.suncor.com) became Canada’s largest integrated oil company in 2009, when it merged with Petro-Canada. Suncor gets 60% of its production from its oil sands projects in Alberta. The remaining 40% comes from conventional oil and natural gas properties. It also operates four refineries and 1,500 gas stations under the Petro-Canada banner.
Hedging delayed merger benefits
...
CAE INC. $10 (www.cae.com) has won $100 million of new contracts. That’s about 6% of CAE’s annual revenue of $1.6 billion. Under these deals, CAE will build and service flight simulators and other equipment for the U.S. and German air forces. Demand for CAE’s products should continue to rise, because it costs much less to train pilots on simulators than on actual aircraft. As well, the company gets half of its revenue from military clients. That cuts its exposure to the cyclical airline industry. Best Buy. CENOVUS ENERGY INC. $34 (www.cenovus.com) has started up the third phase of its 50%-owned Christina Lake oil-sands project in Alberta; ConocoPhillips owns the other 50%. When it reaches full production in 2012, this phase will add 40,000 barrels a day to Christina Lake’s current daily production of 16,000 barrels. Future phases will push up daily production to 218,000 barrels. Buy. MOLSON COORS CANADA INC. $43 (www.molsoncoors.com) plans to invest an extra $280 million in its U.K. breweries over the next five years (all amounts except share price in U.S. dollars). These upgrades will cut these breweries’ power and water use. To put the cost of this plan in context, Molson Coors earned $231.6 million, or $1.23 a share, in the quarter ended June 25, 2011. Buy.
BANK OF NOVA SCOTIA, $53.11, Toronto symbol BNS, continues to benefit from its growing banking operations in the Caribbean, Latin America, South America and Asia. In the three months ended July 31, 2011, the bank’s earnings rose 19.1%, to $1.2 billion from $1.0 billion a year earlier. Earnings per share rose 13.3%, to $1.11 from $0.98, on more shares outstanding. If you exclude certain one-time items, the bank would have earned $1.14 a share in the latest quarter. That beat the consensus estimate of $1.12 a share. Revenue rose 13.6%, to $4.3 billion from $3.8 billion. Bank of Nova Scotia continues to set aside less money to cover bad loans: loan-loss provisions fell 12.0%, to $243 million from $276 million a year earlier....
BANK OF MONTREAL, $59.24, Toronto symbol BMO, recently completed its purchase of U.S. banking firm Marshall & Ilsley Corp. for $4.0 billion in stock. In addition, Bank of Montreal paid an additional $1.7 billion U.S. for all of the preferred shares and warrants that Marshall & Ilsley sold to the U.S. Treasury under the Troubled Asset Relief Program. Adding Marshall & Ilsley more than doubled the number of branches that Bank of Montreal operates in the U.S., and added 2 million customers. The bank will also save over $300 million U.S. a year by combining these new operations with its existing U.S. banking business....
TORONTO-DOMINION BANK, $71.10, Toronto symbol TD, has agreed to buy MBNA’s Canadian credit card operations from Bank of America (New York symbol BAC). This purchase will add 1.8 million customers to TD’s roughly 4.0 million credit-card accounts. MBNA is also the largest issuer of MasterCard cards in Canada, which will diversify TD’s Visa cards. TD will pay $8.5 billion for MBNA’s Canadian credit-card operations when the deal closes, probably early next year. To put that in context, TD earned $5.2 billion, or $5.77 a share, in its 2010 fiscal year, which ended October 31, 2010....
CANADIAN TIRE CORP., $56.55, Toronto symbol CTC.A, reported lower-than-expected earnings this week. In the three months ended July 2, 2011, the company earned $105.8 million, or $1.29 a share. That missed the consensus estimate of $1.45 a share. The latest earnings are also down 13.8% from $122.8 million, or $1.50 a share, a year earlier. Canadian Tire spent more on advertising. As well, cooler spring weather hurt sales of seasonal merchandise, such as gardening equipment. Canadian Tire’s earnings were also held back by costs related to the upcoming, $771-million purchase of The Forzani Group Ltd. (Toronto symbol FGL). Forzani sells sporting goods through over 500 stores in Canada, including SportChek and Athlete’s World. Canadian Tire aims to complete this purchase by the end of September 2011....
Fertilizer maker Agrium has dropped from its peak of $98 in February 2011. That’s mainly due to fears that the global economy is entering another recession. Still, Agrium’s long-term outlook remains strong. That’s largely because rising prosperity in developing regions, such as Asia and Latin America, continues to spur demand for higher-quality food. In response, farmers are applying more fertilizer to increase their crop yields. As well, rising use of corn for fuel additives, such as ethanol, should continue to support fertilizer prices. Another plus for Agrium is that it uses natural gas to make its products. New shale gas discoveries in North America have increased gas supply and depressed prices....
Today’s market turmoil is making many investors wonder if we face a replay of the 2007-2009 market plunge. I see some key differences between the two. The 2007-2009 bear market mostly came about because of the collapse of the U.S. housing boom and everything that went with it. The recent downturn is more like an aftershock following the 2007-2009 market earthquake. Governments around the world, but particularly the U.S. government, tried to counteract the 2007-2009 downturn with clumsy, politically tainted spending that did little to help the broad economy. This left the government with a huge budget deficit and vastly higher debt....
Slowing economic growth and concerns about high U.S. and European debt continue to dampen prices for commodities, like oil, coal and copper. However, rising demand from fast-growing regions, such as Asia and Latin America, should help support resource prices over the long term. The best way to protect the Resources part of your portfolio from volatile commodity prices is with high-quality companies, such as these three. They also trade at attractive multiples to earnings and cash flow. CENOVUS ENERGY INC. $37 (Toronto symbol CVE; Conservative Growth Portfolio, Resources sector; Shares outstanding: 754.1 million; Market cap: $27.9 billion; Price-to-sales ratio: 1.8; Dividend yield: 2.6%; TSINetwork Rating: Extra Risk; www.cenovus.com) operates three oil-sands properties in Alberta and one in Saskatchewan. Cenovus ships the heavy bitumen from these projects to refineries in Illinois and Texas. ConocoPhillips (New York symbol COP) owns 50% of these refineries, as well as 50% of Cenovus’ two main oil-sands projects. Cenovus also owns conventional oil and natural gas properties....
MANITOBA TELECOM SERVICES INC. $31 (Toronto symbol MBT; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 65.2 million; Market cap: $2.0 billion; Price-to-sales ratio: 1.1; Dividend yield: 5.5%; TSINetwork Rating: Average; www.mtsallstream.com) has been upgrading its wireless and Internet networks in the past few years. That’s helping attract new customers for its wireless, high-speed Internet and Internet-based TV services. The company has also cut its annual costs by $20.6 million in the first six months of 2011. For all of 2011, it expects to save between $25 million and $35 million. In the three months ended June 30, 2011, the company’s earnings rose 41.5%, to $49.8 million, or $0.76 a share. A year earlier, it earned $35.2 million, or $0.54. Without unusual items, earnings per share would have risen 9.2%, to $1.31 from $1.20. Revenue rose 0.2%, to $443.7 million from $442.9 million. Manitoba Telecom is a buy.