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
POTASH CORP. OF SASKATCHEWAN $50 (Toronto symbol POT; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 854.3 million; Market cap: $42.7 billion; Price-to-sales ratio: 6.4; Dividend yield: 0.5%; TSINetwork Rating: Average; www.potashcorp.com) has risen 12% since the federal government blocked BHP Billiton Ltd.’s (New York symbol BHP) hostile, $43.33 U.S.-a-share takeover offer in November 2010 (all per-share amounts adjusted for a 3-for-1 split in February 2011). The gain is mainly due to rising fertilizer demand and prices. Potash Corp. is a leading producer of potash, phosphate and nitrogen for use in fertilizers. Most of the company’s mines are in Saskatchewan, which has the world’s largest potash deposits. The company sold 2.8 million tonnes of potash in the first quarter of 2011. That’s up 13.1% from 2.5 million tonnes a year earlier. The average potash price rose 14.0%, to $366 a tonne from $321 (all amounts expect share price and market cap in U.S. dollars)....
Canada’s two main railways face many unpredictable challenges, like bad weather and rising fuel costs. However, both have streamlined their operations. That helps them quickly respond to sudden setbacks. Both should continue to benefit as the improving economy pushes up freight volumes. We like both, but prefer CP for new buying. CANADIAN NATIONAL RAILWAY CO. $73 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 461.8 million; Market cap: $33.7 billion; Price-to-sales ratio: 4.1; Dividend yield: 1.8%; TSINetwork Rating: Above Average; www.cn.ca) operates Canada’s largest freight-rail network, and serves 16 U.S. states. Microsoft co-founder Bill Gates is CN’s largest shareholder, with just over 10% of the shares. In the three months ended March 31, 2011, CN earned $668 million. That’s up 30.7% from $511 million a year earlier. The company spent $340 million on share buybacks in the latest quarter. Because of fewer shares outstanding, earnings per share rose 34.3%, to, $1.45 from $1.08....
ENCANA CORP. $31 (Toronto symbol ECA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 736.3 million; Market cap: $22.8 billion; Price-to-sales ratio: 3.0; Dividend yield: 2.4%; TSINetwork Rating: Average; www.encana.com) continues to use joint ventures to cut the cost of developing its unconventional natural-gas properties. Northwest Natural Gas Co. (New York symbol NWN) will invest $250 million U.S. over the next five years for an undisclosed stake in Encana’s Jonah field in Wyoming. The deal gives Northwest, which distributes gas to 674,000 customers in Oregon and Washington State, a portion of Jonah’s production at a set price. Encana is a buy.
BOMBARDIER INC. (Toronto symbols BBD.A $6.70 and BBD.B $6.69; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 1.7 billion; Market cap: $11.4 billion; Price-to-sales ratio: 0.6; Dividend yield: 1.5%; TSINetwork Rating: Average; www.bombardier.com) continues to win new railcar contracts. The company recently won a nine-year deal to build 200 diesel locomotives for DB Regio AG, which operates public-transit systems in Germany. This contract is worth $867 million, which is equal to 5% of Bombardier’s annual revenue of $17.7 billion (all amounts except share price and market cap in U.S. dollars). The company will start delivering these trains in 2013. Bombardier has also received a $186-million order for 50 electric locomotives from Italy’s state-owned railway company. The company will deliver these trains in 2012 and 2013....
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: 2.5; No dividends paid since February 2009; TSINetwork Rating: Extra Risk; www.precisiondrilling.com) provides contract-drilling services to land-based oil and gas producers in Canada, the U.S. and Mexico. Precision owns 359 drilling rigs. The company earned $0.23 a share in the three months ended March 31, 2011. If you exclude a one-time charge related to the early repayment of certain notes, Precision would have earned $0.30 a share. That’s up 50.0% from $0.20 a share a year earlier. Revenue rose 40.8%, to $525.4 million from $373.1 million. The company continues to see strong demand for rigs that use horizontal drilling techniques to extract oil from hard-to-reach deposits....
SAPUTO INC. $46 (Toronto symbol SAP; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 204.6 million; Market cap: $9.4 billion; Price-to-sales ratio: 1.6; Dividend yield: 1.4%; TSINetwork Rating: Average; www.saputo.com) continues to use acquisitions to expand its dairy operations. Since it became a public company in 1997, it has spent roughly $2.8 billion buying related firms. Expanding by acquisition adds risk. However, Saputo usually buys smaller dairy companies that it can easily integrate with its existing operations. The company is now Canada’s largest producer of dairy products, including milk, butter and cheese. Its main brands include Neilson, Stella and Dairyland. Saputo also has operations in the U.S., Argentina and Europe. Dairy products account for 97% of Saputo’s sales. The remaining 3% comes from snack cakes and tarts.
U.S. is a prime target for Saputo
...
MANITOBA TELECOM SERVICES INC. $33 (www.mts.ca) continues to benefit from its cost cuts and strong demand for wireless and high-speed Internet servcies. In the first quarter of 2011, earnings per share jumped 59.5%, to $0.67 from $0.42 a year earlier. Revenue fell 0.6%, to $439.3 million from $442.0 million. Buy. TORSTAR CORP. $13 (www.torstar.com) has raised its quarterly dividend by 35.1%, to $0.125 a share from $0.0925. The new annual rate of $0.50 yields 3.8%. Best Buy. GREAT-WEST LIFECO INC. $27 (www.greatwestlifeco.com) earned $0.44 a share in the three months ended March 31, 2011, down 2.2% from $0.45 a year earlier. However, the company had...
This week’s election of a majority Conservative government is a positive development for most of the stocks we recommend. That’s mainly because next year’s cut in the corporate tax rate will proceed as planned. As well, the Conservatives will not impose onerous new carbon taxes or environmental regulations on oil-sands operators such as Suncor (see below). Emera should also benefit, as Ottawa will continue to guarantee loans related to its new power plant in Labrador. SUNCOR ENERGY INC., $40.26, Toronto symbol SU, merged with Petro-Canada in 2009 to become Canada’s largest integrated-oil company. In the three months ended March 31, 2011, Suncor’s earnings rose 32.0%, to $1.0 billion from $779 million a year earlier. Earnings per share rose 30.0%, to $0.65 from $0.50. If you exclude unusual items, such as gains and losses on asset sales, Suncor’s earnings per share jumped 291.7%, to $0.94 from $0.24. On this basis, the latest earnings beat the consensus estimate of $0.80 a share....
CGI GROUP INC., $20.70, 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 its fiscal 2011 second quarter, which ended March 31, 2011, CGI earned $117.0 million. That’s up 43.4% from $81.6 million a year earlier. Due to fewer shares outstanding, earnings per share rose 50.0%, to $0.42 from $0.28. If you exclude a tax gain, the company would have earned $0.40 a share in the latest quarter. That beat the consensus earnings estimate of $0.38 a share. Revenue rose 24.5%, to $1.1 billion from $910.4 million a year earlier. If you exclude the negative impact of exchange rates, revenue would have risen 27.9%. Canadian revenue rose 4.3%, and U.S. revenue jumped 67.3%, mainly because the company won a number of new contracts from the U.S. federal government....
PLEASE NOTE: Our next Hotline will go out on Friday, April 29, 2011. TECK RESOURCES LTD., $53.83, Toronto symbol TCK.B, rose 8% this week after the company reported better-than-expected first-quarter earnings. In the three months ended March 31, 2011, Teck’s earnings jumped 123.5%, to $0.76 a share from $0.34 a year earlier. These figures exclude several unusual items, such as gains on asset sales. On this basis, the latest earnings beat the consensus forecast of $0.75 a share. Revenue rose 24.9%, to $2.4 billion from $1.9 billion....