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
SINO-FOREST CORP. $4.92 (Toronto symbol TRE) has attracted a great deal of news coverage in the past few days as it dropped from $20 to below $5. The price collapse follows the release of an independent research report that accused the company of fraud. We recommended Sino-Forest as a buy in December 2003 in Stock Pickers Digest, our newsletter that focuses on aggressive stocks. We recommended selling Sino-Forest three months later, for a gain of nearly 100%. We didn’t advise selling just because we had an opportunity to take a profit. In fact, we had developed qualms about the quality of information that the company was supplying to investors, and corporate actions it was taking....
These three leading industrial companies all face rising costs for labour and raw materials. However, all three continue to win new contracts that will help them offset these expenses. Moreover, all three continue to trade at attractive multiples to earnings. SNC-LAVALIN GROUP INC. $55 (Toronto symbol SNC; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 150.8 million; Market cap: $8.3 billion; Price-to-sales ratio: 1.3; Dividend yield: 1.5%; TSINetwork Rating: Average; www.snclavalin.com) continues to win new contracts, thanks in part to its strong reputation. SNC is a leading Canadian engineering and construction company. It designs and builds large-scale public-works projects, such as roads, bridges, transit systems and water-treatment plants. It also builds mines, chemical plants and electrical-power systems....
ROYAL BANK OF CANADA $54 (Toronto symbol RY; Conservative Growth Portfolio, Finance sector; Shares outstanding: 1.4 billion; Market cap: $75.6 billion; Price-to-sales ratio: 2.1; Dividend yield: 4.0%; TSINetwork Rating: Above Average; www.rbc.com) earned $1.5 billion, or $1.00 a share, in its 2011 second quarter, which ended April 30, 2011. That’s up 13.3% from $1.3 billion, or $0.88 a share, a year earlier. Revenue rose 2.4%, to $7.1 billion from $7.0 billion. The quality of the bank’s loan portfolio continues to improve. It cut its loan-loss provisions by 31.7% in the latest quarter, to $344 million from $504 million. Royal also saw strong earnings gains at its wealth management (up 144.4%), insurance (up 36.4%) and Canadian banking (up 15.6%) divisions. Royal also raised its quarterly dividend by 8.0%, to $0.54 a share from $0.50. The new annual rate of $2.16 yields 4.0%....
RIOCAN REAL ESTATE INVESTMENT TRUST $25 (Toronto symbol REI.UN; Units outstanding: 262.1 million; Market cap: $6.7 billion; Price-to-sales ratio: 7.2; Dividend yield: 5.6%; TSINetwork Rating: Average; www.riocan.com) stands to gain from the acquisition of the Zellers department-store chain by U.S.-based Target Corp. (New York symbol TGT). Target plans to convert 21 of the 34 Zellers stores in RioCan’s malls to the Target banner. It will make a decision on the rest later this year. If Target decides not to convert the remaining stores, they will operate as Zellers stores until their leases expire. The Target stores should help draw more shoppers to RioCan’s malls. As a result, it would receive higher revenue from leases that are based on a percentage of a tenant’s sales. More customer traffic would also make it easier to charge higher rents....
LINAMAR CORP. $20 (Toronto symbol LNR; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 64.7 million; Market cap: $1.3 billion; Price-to-sales ratio: 0.6; Dividend yield: 1.6%; TSINetwork Rating: Extra Risk; www.linamar.com) makes transmission and driveline systems for carmakers in North America, Europe and Asia. Other products include engines and self-propelled, scissor-type elevating work platforms, which it sells under the Skyjack name. The stock fell to $2 in March 2009, as the credit crisis and recession cut new car sales. Linamar responded with a restructuring, including layoffs. That helped it profit as car demand rebounded. Linamar also attracted new clients as some of its weaker competitors went out of business. In the three months ended March 31, 2011, Linamar’s sales rose 32.2%, to $675.2 million from $510.7 million a year earlier. Most of the gain was due to a 27.8% sales increase at the powertrain/driveline division (which accounted for 90% total sales). Sales at the industrial products division (10% of sales) jumped 94.4%....
Maple Leaf Foods and its subsidiary Canada Bread are cutting costs so they can better compete with larger, U.S.-based food companies. Both companies are closing smaller plants and merging their operations with larger facilities. We like both, but Maple Leaf offers better value. MAPLE LEAF FOODS INC. $11 (Toronto symbol MFI; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 140.0 million; Market cap: $1.5 billion; Price-to-sales ratio: 0.3; Dividend yield: 1.4%; TSINetwork Rating: Average; www.mapleleaf.ca) is Canada’s largest food-processing company. It mainly makes its products, which include fresh and prepared meats and poultry, under the Maple Leaf and Schneider brands. Maple Leaf also owns 90.0% of Canada Bread. In the three months ended March 31, 2011, Maple Leaf earned $10.5 million. That’s down 47.0% from $19.9 million a year earlier. Earnings per share fell 42.9%, to $0.08 from $0.14, on more shares outstanding. Without one-time items, such as restructuring costs, earnings per share would have jumped 157.1%, to $0.18 from $0.07. Sales fell 3.7%, to $1.15 billion from $1.19 billion a year earlier, mostly because the company sold some operations. If you exclude contributions from these businesses, sales would have risen 3.7%....
BOMBARDIER INC. (Toronto symbols BBD.A $6.88 and BBD.B $6.89; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.8 billion; Market cap: $12.4 billion; Price-to-sales ratio: 0.7; Dividend yield: 1.4%; TSINetwork Rating: Average; www.bombardier.com) will use robots to assemble the cockpit and fuselage of its new CSeries jets....
IMPERIAL OIL LTD. $46 (Toronto symbol IMO; Shares outstanding: 847.6 million; Market cap: $39.0 billion; Price-to-sales ratio: 1.5; Dividend yield: 1.0%; TSINetwork Rating: Average; www.imperialoil.ca) now estimates that its Kearl oil-sands project will cost $10.9 billion. That’s 36% higher than its earlier estimate of $8 billion. The company owns 71% of Kearl, and Exxon-Mobil Corp. (New York symbol XOM) owns the remaining 29%. ExxonMobil also owns 69.9% of Imperial’s shares. Imperial has changed the original design of this project to make it easier to expand in the future, and to respond to new environmental regulations. These changes were the main reason for the higher costs....
INDIGO BOOKS & MUSIC INC. $13 (Toronto symbol IDG; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 24.7 million; Market cap: $321.1 million; Price-to-sales ratio: 0.3; Dividend yield: 3.6%; TSINetwork Rating: Average; www.chapters.indigo.ca) saw its revenue rise 5.0% in its 2011 fiscal year, which ended April 2, 2011, to $1.0 billion from $968.9 million in the prior year. Even so, earnings fell 67.5%, to $11.3 million, or $0.45 a share, from $34.9 million, or $1.39 a share. The earnings drop is due to ongoing investments in its 51.4%-owned Kobo electronic-book (e-book) operations. This business sells e-book downloads and the Kobo e-book reading device. Indigo and its partners recently invested an additional $50 million in Kobo; Indigo’s share was $13 million. Kobo has attracted 3.6 million users from more than 100 countries in just over 15 months. However, it faces fierce competition from market leader Amazon.com (Nasdaq symbol AMZN), which is now selling more e-books than paper books....
ENBRIDGE INC. $31 (Toronto symbol ENB; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 774.3 million; Market cap: $24.0 billion; Price-to-sales ratio: 1.5; Dividend yield: 3.2%; TSINetwork Rating: Above Average; www.enbridge.com) gets 80% of its revenue by operating pipelines that pump crude oil and natural gas from western Canada to eastern Canada and the U.S. The remaining 20% mainly comes from distributing natural gas to 2 million consumers in Ontario, Quebec and parts of New York State. The company is also developing a gas distribution system in New Brunswick.