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
BOMBARDIER INC. $6.32 (Toronto symbol BBD.A) earned $0.26 a share in its fiscal year ended January 31, 2008, up 85.7% from $0.14 in the prior year (all amounts except share price in U.S. dollars). Revenue grew 17.5%, to $17.5 billion from $14.9 billion. Aircraft deliveries rose 10.7% in fiscal 2008, to 361 from 326. Revenue at Bombardier’s train division grew 18.2%, thanks to strong demand for passenger railcars in China and India. Buy. INDIGO BOOKS & MUSIC INC. $13 (Toronto symbol IDG) is doing a good job attracting users to its website with online community groups based on authors and genres. Since their launch in October 2007, these groups now have over 100,000 members. Features like this help build customer loyalty and spur sales. Buy. TRANSCONTINENTAL INC. $18 (Toronto symbol TCL.A) has increased its quarterly dividend 14.3%, from $0.07 a share to $0.08. The new annual rate of $0.32 yields 1.8%. Buy....
CAE INC. $12 (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 253.9 million; Market cap: $3.0 billion; SI Rating: Average) is a leading supplier of flight simulators to commercial airlines and the military forces of more than 35 countries. Through 24 training facilities equipped with over 115 flight simulators, CAE trains more than 50,000 pilots a year.
Diverse clientele tempers CAE’s risk
CAE’s exposure to the cyclical airline business adds risk. However, the company now gets about half of its revenue from commercial clients, and half from military customers. As well, training services give CAE steady, recurring revenues. That cuts its reliance on new products for growth. Services and products each account for roughly half of CAE’s total revenue. Revenue fell from $1.1 billion in fiscal 2003 (fiscal years end March 31) to $986.2 million in 2005 after CAE sold its non-aviation operations as part of major restructuring. Revenue grew to $1.25 billion in 2007, and should reach $1.4 billion in 2008. Earnings before restructuring costs fell from $0.60 a share (total $131.0 million) in fiscal 2003 to $0.19 a share ($46.9 million) in 2005. Earnings jumped to $0.52 a share ($129.1 million) in 2007....
RIOCAN REAL ESTATE INVESTMENT TRUST $21 (Toronto symbol REI.UN; Aggressive Growth Portfolio, Manufacturing & Industry sector; Units outstanding: 210.9 million; Market cap: $4.4 billion; SI Rating: Average) has signed a long-term leasing deal with Lowe’s, the second-largest home improvement chain in the United States after Home Depot. Lowe’s will initially operate two stores in RioCan’s Toronto area malls. It aims to open more than 20 new stores in Canada over the next few years. RioCan did not provide financial details. However, high-quality tenants such as Lowe’s will help RioCan maintain its $1.35 distribution rate (6.4% yield). RioCan is a buy.
CANADIAN NATIONAL RAILWAY CO. $50 (Toronto symbol CNR; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 485.2 million; Market cap: $24.3 billion; SI Rating: Above average) is the subject of a $270 million lawsuit accusing it of failing to pay overtime to 1,000 current and former employees. However, any award is likely to be modest next to CN’s 2007 cash flow of $2.6 billion or $5.12 a share. CN Rail is a buy. CANADIAN TIRE CORP. $66 (Toronto symbol CTC.A; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 81.5 million; Market cap: $5.4 billion; SI Rating: Above average) plans to phase out the print version of its catalogue, which it publishes twice a year. That’s because more people are now shopping online rather than using catalogues. Canadian Tire will invest the money it now spends on paper and printing in its own website and direct marketing campaigns....
TRANSCANADA CORP. $36 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 539.7 million; Market cap: $19.4 billion; SI Rating: Above average) has agreed to buy the Ravenswood power plant located in Queens, New York for $2.9 billion U.S. The plant has the capacity to service 21% of New York City’s peak electricity load. The price is 10% more than TransCanada’s 2007 cash flow of $2.6 billion or $4.95 a share. TransCanada will probably issue $1.2 billion worth of new common shares to help pay for this purchase. The acquisition provides diversification in power generation and into the U.S. market. TransCanada should also profit from rising power demand in New York....
Agrium and Nova use natural gas to make their products, and ready access to large gas reserves gives them a cost advantage over their competitors. However, only Nova is a buy at current prices. AGRIUM INC. $72 (Toronto symbol AGU; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 158.0 million; Market cap: $11.4 billion; SI Rating: Average) is a leading producer of fertilizers and crop protection products. The company uses natural gas to make ammonia, the basic ingredient in fertilizers. Most of Agrium’s facilities are near large gas suppliers in Alberta, which helps keep its input costs down. Agrium will soon close its fertilizer plant in Kenai, Alaska, since it couldn’t find a reliable source of natural gas for the plant. The company looked into a plan to convert coal to natural gas. However, Agrium feels the project’s $2 billion U.S. cost is too expensive. It earned $3.25 U.S. a share (total $441 million U.S.) in 2007....
MDS INC. $20 (Toronto symbol MDS; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 122.4 million; Market cap: $2.4 billion; SI Rating: Average) operates in three medical-related fields: contract drug research (roughly 45% of revenue), analytical devices (35%) and medical isotopes for cancer treatments (20%). The stock fell to $16 in February 2008 after the nuclear reactor that supplies the bulk of its isotopes had to shut down for maintenance. The disruption cut MDS’s pre-tax profits by $5 million (all amounts except share price and market cap in U.S. dollars). The stock has since risen 25%. In its first fiscal quarter ended January 31, 2008, earnings rose 6.3%, to $17 million from $16 million a year earlier. Earnings per share rose 27.3%, to $0.14 from $0.11, on fewer shares outstanding. However, if you exclude unusual items, earnings per share fell 28.6%, to $0.05 from $0.07. Revenue grew 22.0%, to $322 million from $264 million....
BCE INC. $37 (Toronto symbol BCE; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 805.3 million; Market cap: $29.8 billion; SI Rating: Above average) moved a step closer to a takeover after gaining regulatory approval. As well, a court recently dismissed a class-action lawsuit by bondholders. These rulings improve the chances that the $42.75-a-share acquisition by a group led by the Ontario Teachers’ Pension Plan will succeed. The stock still trades below the bid price, mainly due to the problems in the credit markets. That could make it harder for the consortium to issue the bonds it needs to complete the takeover. If the deal falls through, BCE’s stock would probably suffer, at least in the short term. However, we feel its long-term prospects outweigh this risk....
FORDING CANADIAN COAL TRUST $63 (Toronto symbol FDG.UN; Aggressive Growth Portfolio, Resources sector; Units outstanding: 148.0 million; Market cap: $9.3 billion; SI Rating: Average) has gained 70% since the start of 2008, on strong demand for coal from Chinese steelmakers plus flooding at some Australian mines that limited global coal supplies....
Technology companies operate in a highly competitive and cyclical industry, so they must continue to invest heavily in research and marketing. We aim to cut tech stock risk by focusing on companies with distinct competitive advantages, such as proprietary technology, broad geographic reach and a wide client base. These advantages should help these three techs weather the inevitable downturns, and thrive when conditions improve. GENNUM CORP. $9.05 (Toronto symbol GND; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 35.6 million; Market cap: $322.2 million; SI Rating: Above average) makes equipment that lets broadcasters store, manipulate and transport video signals without losing picture quality. This business accounts for 75% of Gennum’s total revenue. The company also makes chips for computer networks. Gennum recently completed a major realignment of its operations. It sold its slow-growing hearing aid and headset businesses, as well as part of its video chip operations....