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
TRANSCANADA CORP. $36 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 536.3 million; Market cap: $19.3 billion; SI Rating: Above average) will take part in the expanded refurbishment of unit four of the ‘A’ section of Ontario’s Bruce nuclear power station. The $1 billion addition will bring the cost of the restart of the four units at the plant to a total of $5.25 billion, with TransCanada’s share now set at $2.625 billion. TransCanada holds a 48.7% stake in the partnership that is half way through the restart of the ‘A’ section of Bruce. The additional investment by TransCanada, Cameco and the other partners will extend the expected life of unit four from 2017 to 2036. The other three units are already scheduled to last until 2036. Bruce A now operates at 50% capacity, but should reach full capacity by 2010 when the restart of units one and two is complete....
MDS INC. $22 (Toronto symbol MDS; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 122.5 million; Market cap: $2.7 billion; SI Rating: Average) has completed reviews of about 85% of the tests performed at its Montreal drug-testing lab, as requested by the U.S. Food and Drug Administration. European regulators may also ask for more data, but the FDA audits should satisfy most of their concerns. These audits cost MDS $0.02 a share in its third fiscal quarter ended July 31, 2007 (all amounts except share price and market cap in U.S. dollars). It also absorbed $0.05 a share in restructuring costs related to a recent acquisition. If you exclude all unusual charges, earnings jumped to $0.14 a share from $0.01 a year earlier. Revenue grew 24.4%, to $321 million from $258 million. If you exclude the acquisition, revenue rose 3%....
BCE Inc. is the subject of a $42.75-a-share takeover offer. We feel BCE shareholders should vote in favour of the offer at a special meeting on September 21, 2007. That way, you’ll get the full amount without paying brokerage fees. We think most investors should hold some phone stocks as part of the Utilities sector component of a well-balanced portfolio....
PETRO-CANADA $56 (Toronto symbol PCA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 488.8 million; Market cap: $27.4 billion; SI Rating: Average) has formed a joint venture with Gazprom, a major Russian natural gas company, to build a liquefied natural gas (LNG) plant that will cool gas into a liquid form for transport by tanker. Petro-Canada also has a joint venture with TransCanada Corp. to build a plant in Quebec that would re-convert the LNG from Russia and elsewhere back into natural gas for transportation through pipelines to markets in Quebec and Ontario. These terminals will cost billions to build and operate. Sharing these costs with partners cuts Petro-Canada’s risk. The company aims to begin importing LNG in late 2009....
ALCAN INC. $102 (Toronto symbol AL;Conservative Growth Portfolio,Resources sector; Shares outstanding: 369.7 million; Market cap: $37.7 billion; SI Rating: Average) is trading below Rio Tinto Ltd.'s takeover offer of $101 U.S. a share (about $105 Cdn.) That’s because of investor worries that Rio Tinto may have trouble completing the takeover, given recent turmoil in credit markets and falling aluminum prices. The difference between the current price and the offer may entice some investors to buy Alcan, hoping to lock in a quick profit before Rio Tinto’s offer expires on September 24. However, we don’t recommend buying Alcan now. The stock could drop 30% or more in the unlikely event that Rio Tinto pulls out, while the most it can gain is just 3%. Current Alcan holders should tender their shares....
SHAWCOR LTD. $35 (Toronto symbol SCL.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 71.7 million; Market cap: $2.5 billion; SI Rating: Average) makes sealants and coatings that protect onshore and offshore oil and natural gas pipelines from corrosion. It also inspects and repairs pipelines. These businesses account for about 85% of ShawCor’s revenue. The remaining 15% comes from making industrial equipment such as drilling equipment, electrical wires and protective sheaths. The Shaw family controls 89% of the class ‘B’ multiple voting shares. ShawCor is a leader in most of its niche markets. This, plus its established reputation and a big rise in new pipeline construction, pushed up ShawCor’s revenues from $690.6 million in 2002 to $1.1 billion in 2006. The company earned just $0.02 a share (total $1.1 million) in 2002 due to a writedown. But profits improved to $0.34 a share ($24.4 million) in 2003. Restructuring costs led to a loss of $1.16 a share ($86.7 million) in 2004, but earnings from continuing operations rebounded to $1.25 a share ($92.9 million) in 2006....
ShawCor is a leader in the market for products and services to control and detect oil and gas pipeline corrosion. It’s now using its strong position in this niche to expand in a number of growing markets, including Alberta’s oil sands, North American liquefied natural gas projects, untapped international markets and new technologies. SHAWCOR LTD. $35 (Toronto symbol SCL.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 71.7 million; Market cap: $2.5 billion; SI Rating: Average) makes sealants and coatings that protect onshore and offshore oil and natural gas pipelines from corrosion. It also inspects and repairs pipelines. These businesses account for about 85% of ShawCor’s revenue. The remaining 15% comes from making industrial equipment such as drilling equipment, electrical wires and protective sheaths. The Shaw family controls 89% of the class ‘B’ multiple voting shares. ShawCor is a leader in most of its niche markets. This, plus its established reputation and a big rise in new pipeline construction, pushed up ShawCor’s revenues from $690.6 million in 2002 to $1.1 billion in 2006....
EMERA INC. $20 (Toronto symbol EMA) earned $0.30 a share in the second quarter of 2007, up 15.4% from $0.26 a year earlier, thanks to strong growth at its core Nova Scotia Power subsidiary as well as income from its new power plant in Massachusetts. The better earnings let Emera raise its annual dividend rate 2.2%, from $0.89 to $0.91. It now yields 4.6%. Buy. ANDREW PELLER LTD. $10 (Toronto symbol ADW.A) continues to profit from strong demand for its premium wines. In its first fiscal quarter ended June 30, 2007, earnings per share rose 25.0%, to $0.20 from $0.16 a year earlier. If you exclude unusual items, profits rose 13%. Peller recently increased its dividend for the second straight year. The new annual rate of $0.30 yields 3.0%. Buy. BANK OF MONTREAL $61 (Toronto symbol BMO) has launched a new loyalty MasterCard aimed at students between 18 and 24 years old. The card will give them discounts on merchandise and services at certain stores. The bank feels the new card will help it sell more services to these students as they grow older, such as home mortgages and RRSPs. Buy.
TRANSCANADA CORP. $37 (Toronto symbol TRP; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 536.3 million; Market cap: $19.8 billion; SI Rating: Above average) operates a 59,000-km network of natural gas pipelines in Canada and the United States. This business supplies about two-thirds of its profit. The remaining third comes from its electrical power division. TransCanada’s revenue rose from $5.2 billion in 2002 to $7.5 billion in 2006, or 9.6% compounded annually. Profits from continuing operations rose from $1.55 a share (total $747 million) in 2002 to $2.47 a share ($1.2 billion) in 2005, but fell to $2.14 a share ($1.05 billion) in 2006. If you disregard gains on the sale of assets, per-share income would have grown from $1.72 in 2005 to $1.89 in 2006.
Looking for the next Bruce
In the past few years, the company has used acquisitions to cut its reliance on its traditional gas pipeline business. Its most profitable investment to date is its minority stakes in two partnerships that operate Ontario’s Bruce nuclear power facility. Bruce provided 10% of TransCanada’s operating income in 2006....
CANADIAN UTILITIES LTD. (Toronto symbols CU $46 (Class A) and CU.X $46 (Class B); Income Portfolio, Utilities sector; Shares outstanding: 125.4 million; Market cap: $5.8 billion; SI Rating: Above average) earned $0.64 a share in the second quarter of 2007, up 16.4% from $0.55 a year earlier. A cooler-than-usual spring in Alberta, which helped spur strong demand and prices for natural gas, offset higher operating costs. Revenue, however, fell slightly to $560.3 million from $563.4 million. Revenue should improve in the second half as electricity demand in Alberta grows. Canadian Utilities is a buy. The more liquid class ‘A’ non-voting shares are the better choice. MANITOBA TELECOM SERVICES INC. $47 (Toronto symbol MBT; Conservative Growth Portfolio, Utilities sector; Shares outstanding: 64.6 million; Market cap: $3.0 billion; SI Rating: Average) continues to benefit from a restructuring and its strategy to expand its fast-growing wireless and Internet operations. It earned $0.79 a share before unusual items in the second quarter, up 16.2% from $0.68 a year earlier. Revenue fell 1%, to $474.1 million from $479.1 million. But if you disregard the loss of two former customers of its Allstream business communication division, revenue would have increased by 1.7%....