Tuesday, March 5, 2019

Dividend Stocks March 2019

First, I want to point out that not all of the stocks I follow are great investments. I follow a diverse selection of stocks. There are some that I would never invest in personally. I follow a number of resource stocks even though I personally have little invested in this area. I follow what I find interesting and with resource stocks, I think it is important for Canadians to know what is happening in the resource area. On the other hand, I do follow of good number of great dividend growth stocks.

The theory is that you should use the dividend yield to see if a dividend stock is selling at a stock price that is relatively cheap. A stock price is considered cheap if it is selling at a dividend yield higher than the historical high yield or higher than the historical average yield or historical median yield. See my spreadsheet at dividend growth stocks that I just updated for March 2019.

On this list,
  • I have 12 stocks with a dividend yield higher than the historical high dividend yield,
  • I have 55 stocks with a dividend yield higher than the historical average dividend yield
  • I have 77 stocks with a dividend yield higher than the historical median dividend yield and
  • 87 stocks with a dividend yield higher than the 5 year average dividend yield.
When I did my list last list in February 2019,
  • I have 14 stocks with a dividend yield higher than the historical high dividend yield,
  • I have 55 stocks with a dividend yield higher than the historical average dividend yield
  • I have 81 stocks with a dividend yield higher than the historical median dividend yield and
  • 99 stocks with a dividend yield higher than the 5 year average dividend yield.
When I did my list in January 2014,
  • I had 9 stocks with a dividend yield higher than the historical high dividend yield,
  • I had 45 stocks with a dividend yield higher than the historical average dividend yield and
  • 39 stocks with a dividend yield higher than the 5 year average dividend yield.
If you had one share of each stock, total dividends last month would be $170.08. This month dividends would be $169.48 which is a reset figure after the changes noted below. Of the stock that I follow 23 stocks has raised their dividends since last month. Goodfellow Inc. (TSX-GDL, OTC-GFELF) has restarted their dividends.

Bank of Nova Scotia (TSX-BNS, NYSE-BNS)
Barclays PLC (LSE-BARC, NYSE-BCS)
BCE (TSX-BCE, NYSE-BCE)
Brookfield Asset Management (TSX-BAM.A, NYSE-BAM)
CCL Industries (TSX-CCL.B, OTC-CCDBF)

CIBC (TSX-CM, NYSE-CM)
Encana Corp. (TSX-ECA, OTC-ECA)
FirstService Corp (TSX-FSV, NASDAQ-FSV)
Goeasy Ltd (TSX-GSY, OTC-EHMEF)
Goodfellow Inc. (TSX-GDL, OTC-GFELF)

Great-West Lifeco Inc. (TSX-GWO, OTC-GWLIF)
Innergex Renewable Energy (TSX-INE, OTC-INGXF)
Intact Financial Corp. (TSX-IFC, OTC-IFCZF)
Magna International Inc. (TSX-MG, NYSE-MGA)
Royal Bank (TSX-RY, NYSE-RY)

Stantec Inc. (TSX-STN, NYSE-STN)
Stingray Digital Group Inc (TSX-RAY.A)
Suncor Energy (TSX-SU, NYSE-SU)
TMX Group Ltd. (TSX-X, OTC-TMXXF)
Toromont Industries Ltd (TSX-TIH, OTC-TMTNF)

Toronto Dominion Bank (TSX-TD, NYSE-TD)
TransCanada Corp (TSX-TRP, NYSE-TRP)
Transcontinental Inc. (TSX-TCL.A, OTC-TCLAF)

Of the stocks I follow, one stock has cut their dividends. That stock is:

SNC-Lavalin (TSX-SNC, OTC-SNCAF).

Of the stocks I follow, one stock has suspended or terminated their dividends. There is a tension between needing money for investing in growth and paying dividends. Alcanna feels that using their capital to invest in growth is better at this point than paying dividends. That stock is:

Alcanna Inc (TSX-CLIQ, OTC-LQSIF)

In January I wrote that Thomson Reuters Corp (TSX-TRI, NYSE-TRI) dividend appears to have increased, but has not. The company did a return of capital transaction which resulted in a reverse stock split of at a ratio of 1 pre-consolidated share for 0.9079 post-consolidated shares. This results in higher dividend per share. However, their dividend has not changed as expected. Their old dividend times the post-consolidation value of 0.9079 should equal a dividend of $0.39, but they are paying only $0.36.

For some reason this company’s stock price of Lassonde Industries (TSX-LAS.A, OTC-LSDAF) has fallen since last month when all other stocks seem to be up with some admittedly down a bit. The stock price has fallen 15% since last month. It seems to have fall some 40% since its high in June of last year. It is not a well followed stock and I can find no reason for the decline. Last month I noted a big decline in Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR) stock.

Most of my stocks started out as Dividend Payers. Currently 13 stocks are not paying any dividends and this would be some 8.39% of the stocks that I follow. Four of these stocks never had dividends, so 5.81% of the stocks I follow have suspended their dividends. The three stocks that never paid dividends are Ballard Power Systems Inc. (TSX-BLD, NASDAQ-BLDP), Blackberry Ltd. (TSX-BB, NASDAQ-BBRY) and Trigon Metals Inc. (TSX-TM, OTC-PNTZF).

I am showing whether a stock is relatively cheap based on historical high dividend yields (P/Hi), historical average dividend yields (P/Ave), historical median dividend yields (P/Med) or on 5 year median dividend yields (P/5Yr). See these fields on the right side of the file. You can highlight a particular stock using your cursor to highlight the appropriate line.

There are always some stocks to buy because they are priced reasonably. There are always stocks to currently avoid because they are overpriced. Looking at dividend growth stocks that are selling at stock prices that give them a dividend yield above the historical median dividend yield are probably the best bet.

The stocks that are selling at prices that give them a dividend yield above the historical high yield could be good stocks to buy. However, these stocks may be selling so cheap because of current troubles, especially financial troubles and should be treated with caution. Do not forget that I have all the stocks I follow on this spreadsheet and some are much better investments than others.

You should always investigate a stock before you buy. Sometimes different stocks in certain sectors are just out of favour or the stock market is just in one of its declines. However, a stock may be relatively cheap because it has problems. That is why you should always investigate a stock before buying.

Looking at stock this way is equivalent to a stock filter. A main problem I know of is for the old income trusts. These companies have generally lowered their dividend yields forever and they will probably never get back to the old dividend yield highs they made as an income trust company. For these stocks, you might be better comparing the current dividend yield to the 5 year median dividend yield. I also started a column called VT (for Valid Test) and this applies to checking stock price using dividend yield. If it is not a valid test I use N to show this.

Also, on some stocks I have a lot more information years in my spreadsheets than for other stocks. So, finding a stock on the list as "cheap" is only the first step in finding a stock to buy. This is the same with any other sort of stock filters that you can use.

The last thing to remember is that I have entering figures into a spreadsheet. I could put them in incorrectly, I can transpose figures and I can misread figures. This is another great reason why you should check a stock out before investing. As this is just a filter, it works better on some stocks than on others.

See my entry on my methodology in establishing the historical dividend yield highs and lows for the stocks that I cover. I have an entry on my introduction to Dividend Growth. You might want to look at my original entry on Dividend Growth Stocks. I have also written about why I like Dividend Growth companies.

On my other blog I wrote yesterday about RioCan Real Estate (TSX-REI.UN, OTC-RIOCF) ... learn more. Next, I will write Allied Properties Real Estate Investment Trust (TSX-AP.UN, OTC-APYRF) ... learn more on Wednesday, March 6, 2019 around 5 pm.

This blog is meant for educational purposes only and is not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional. I do research for my own edification and I am willing to share. I write what I think and I may or may not be correct.

See my website for stocks followed and investment notes. I have three blogs. The first talks only about specific stocks and is called Investment Talk. The second one contains information on mostly investing and is called Investing Economics Mostly. My last blog is for my book reviews and it is called Non-Fiction Mostly. Follow me on Twitter or StockTwits. I am on Instagram with #walktoronto.

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