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 IMPERIAL BANK OF COMMERCE $77 (Toronto symbol CM; Conservative Growth Portfolio, Finance sector; Shares outstanding: 397.0 million; Market cap: $30.2 billion; Price-to-sales ratio: 2.0; Dividend yield: 4.5%; TSINetwork Rating: Above Average; www.cibc.com) was the first Canadian bank to let its customers access their accounts using smartphones and other mobile devices. This service has been successful, so CIBC now plans to launch software that will let its brokerage clients use their mobile phones to manage their portfolios and trade stocks. This should give CIBC an edge over its competitors as more people access the Internet through mobile devices instead of computers. CIBC is a buy.
ANDREW PELLER LTD. $9.05 (Toronto symbol ADW.A; Income Portfolio, Consumer sector; Shares outstanding: 14.3 million; Market cap: $129.4 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. Peller operates wineries in B.C., Ontario and Nova Scotia. It also sells home-winemaking kits and imports wines from other countries. In its 2011 fiscal year, which ended March 31, 2011, Peller’s sales rose 0.9%, to $265.4 million from $263.2 million in fiscal 2010. The company launched new wines during the year, and saw strong sales of its premium wines. That helped offset new taxes on certain wines sold through company-owned stores in Ontario. These taxes cut the company’s 2011 sales by $3 million....
Both TransCanada and Enbridge are building new oil pipelines. These are expensive projects, but the companies’ regulated businesses give them lots of cash flow for expansion and continued dividend increases. TRANSCANADA CORP. $40 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 703.0 million; Market cap: $27.3 billion; Price-to-sales ratio: 3.4; Dividend yield: 4.3%; TSINetwork Rating: Above Average; www.transcanada.com) operates a pipeline network that pumps natural gas from Alberta to eastern Canada and the U.S. It also owns or invests in over 20 power plants in Canada and the U.S. In June 2010, the company opened the first phase of its Keystone pipeline. This phase pumps crude oil from Alberta to refineries in Illinois. The second phase extends to Oklahoma, and began operating in February 2011....
LOBLAW COMPANIES $36 (Toronto symbol L; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 282.2 million; Market cap: $11.0 billion; Price-to-sales ratio: 1.0; Dividend yield: 2.1%; TSINetwork Rating: Above Average; www.loblaw.ca) has opened five stand-alone Joe Fresh casual-clothing stores since October 2010. It plans to open five more stores by the end of 2011. It eventually wants to expand the chain to 20 stores. As well, Loblaw continues to sell Joe Fresh clothing in its supermarkets. That’s helping it compete with general retailers, like Wal-Mart, which have expanded into groceries. Loblaw is a buy.
RIOCAN REAL ESTATE INVESTMENT TRUST $25 (Toronto symbol REI.UN; Units outstanding: 263.4 million; Market cap: $6.0 billion; Price-to-sales ratio: 6.0; Dividend yield: 5.2%; TSINetwork Rating: Average; www.riocan.com) has interests in 305 shopping malls in Canada, including 10 under development. RioCan also owns stakes in 35 malls in the U.S. through joint ventures. In the first six months of 2011, the trust bought or increased its stake in 16 properties. These purchases cost it a total of $230 million ($139 million in Canada and $91 million in the U.S.). That’s 25.7% more than its cash flow of $183 million, or $0.70 a unit, in the first half of 2011. However, these properties have grocery stores and other major retailers as anchor tenants. That cuts their risk. In the current quarter, RioCan plans to spend $245.9 million to buy or raise its interest in 11 more properties....
INDIGO BOOKS & MUSIC INC. $12 (Toronto symbol IDG; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 25.2 million; Market cap: $321.1 million; Price-to-sales ratio: 0.3; Dividend yield: 3.6%; TSINetwork Rating: Average; www.chapters.indigo.ca) owns 51.4% of Kobo Inc., which sells electronic books and e-book readers. U.S.-based bookseller Borders Group also owns 11% of Kobo. Borders recently declared bankruptcy, and is now in liquidation. It’s unclear if Indigo will buy this interest. Such a move would further weigh on the company’s earnings, which are already suffering because of its ongoing Kobo investments. As well, the closure of Borders’ bookstores cuts off an important distribution channel for the Kobo e-book reader....
HOME CAPITAL GROUP INC. $50 (Toronto symbol HCG; Aggressive Growth Portfolio, Finance sector; Shares outstanding: 34.7 million; Market cap; $2.0 billion; Price-to-sales ratio: 3.8; Dividend yield: 1.2%; TSINetwork Rating: Average; www.homecapital.com) offers mortgages to borrowers who don’t meet the stricter criteria of larger, traditional lenders. Even though Home Capital caters to riskier borrowers, it has avoided the huge credit losses that have crippled many U.S. banks. That’s because it continues to do a good job of identifying problem loans early. It then uses this information to restructure a borrower’s repayment terms and adjust its lending policies. Home mortgages account for 90% of the company’s loan portfolio. The remaining 10% consists of other loans, such as non-residential mortgages and credit cards. Home Capital offers its loans through five retail branches in Toronto, Vancouver, Calgary, Montreal and Halifax....
BANK OF NOVA SCOTIA $52 (www.scotiabank.com) will get $60 million in earnings from Scotiabank Mexico, its Mexican subsidiary, in its current quarter; Bank of Nova Scotia earned $1.5 billion, or $1.36 a share, in the quarter ended April 30, 2011....
When investors see a day like Thursday, with a drop of more than 500 points in the Dow Jones Industrials, they can’t help but wonder if we face a replay of the 2007-2009 market plunge. However, though today’s situation could turn out badly, that’s not inevitable. It’s much different from a few years ago. The 2007-2009 drop was mostly about the collapse of the housing boom and everything that went with it. Today there is no boom that could deflate and bring down the economy. Today’s problem grows out of government attempts at ‘fixing’ the economy in recent years. These fixes, which were mostly unsuccessful, bloated government spending and created huge debts. Today’s main market worry is how the U.S. federal government will attempt to fix its budget deficit and bring its debt down to a manageable level. To top things off, the Obama administration has also brought in big changes in health care, union and environmental rules and so on. Some of these changes face court challenges and political opposition. But some are sure to survive and go into effect. Others are sure to follow....
CGI GROUP INC., $20.54, Toronto symbol GIB.A, is Canada’s largest provider of computer-outsourcing services. The company’s services can automate certain routine functions, such as accounting and buying supplies. That makes its clients more efficient, and lets them focus on their main businesses. In the three months ended June 30, 2011, CGI earned $118.4 million. That’s up 37.9% from $85.9 million a year earlier. The company spent $56.9 million on share buybacks in the latest quarter. Due to fewer shares outstanding, earnings per share rose 43.3%, to $0.43 from $0.30. If you exclude a tax gain and other unusual items, CGI would have earned $0.38 a share in the latest quarter. That matched the consensus earnings estimate. Revenue rose 15.1%, to $1.04 billion from $901.6 million a year earlier. If you exclude the negative impact of exchange rates, revenue would have risen 18.0%. Canadian revenue fell 6.5%, due to delays in starting up new projects. However, U.S. revenue jumped 54.1%, mainly due to last year’s acquisition of Stanley Inc., which sells computer-outsourcing services to U.S. government agencies. Revenue at CGI’s European operations rose 27.4%....