Why Low Yield Stocks

I have been asked why I would have low yield stocks when I life off my dividends. Compare MRU, CNR and HR yield after 20 years. In the table below, I show what I consider to be low, moderate, and good dividend yields and what I consider to be low, moderate, and good dividend growth.

Yield	Range		Growth	Range
Low	0% to 1%		Low	0% to 7%
Moderate	2% to 4%		Moderate	8% to 14%
Good	5% to 6%		Good	15% and over

Stocks tend to have low yield and good growth, or good yield and low growth or moderate yield and moderate growth. Of course, this is only a tendency. Also, it counts how much you paid for your stock relatively speaking. My 20 years yield on original price assumes that you made a median price for the stock.

The following figures are from Metro Inc (TSX-MRU, OTC-MTRAF). I have had this stock for 15 years and I am earning 12.22% yield on my original purchase price. If I had bought this stock 20 years ago, I would be making 21.35% on my original purchase.

From	Years	Div. Gth		Period	Yield
2013	5	16.91%		Current Yield	1.52%
2008	10	15.71%		5 year Median Yield	1.46%
2003	15	14.82%		10 year Median Yield	1.47%
1998	20	16.32%		Historical Median Yield	1.45%
				20 years yield on original price	21.35%

The following figures are from Canadian National Railway (TSX- CNR, NYSE- CNI). I have had this stock for 13 years, and I am making 10.09% yield on my original purchase price. If I had bought this stock 20 years ago, my yield on my original cost would be 27.41%.

From	Years	Div. Gth		Period	Yield
2013	5	16.18%		Current Yield	1.87%
2008	10	14.74%		5 year Median Yield	1.78%
2003	15	17.24%		10 year Median Yield	1.61%
1998	20	16.33%		Historical Median Yield	1.57%
				20 years yield on original price	27.41%

The following figures are from H & R Real Estate Trust (TSX-HR.UN, OTC-HRUFF). I do not own this stock. If I had bought this stock 20 years ago, my yield on my original cost would be 13.05%.

From	Years	Div. Gth		Period	Yield
2013	5	16.18%		Current Yield	1.87%
2008	10	14.74%		5 year Median Yield	1.78%
2003	15	17.24%		10 year Median Yield	1.61%
1998	20	16.33%		Historical Median Yield	1.57%
				20 years yield on original price	27.41%

On my other blog I wrote yesterday about Canadian Imperial Bank of Commerce (TSX-CM, NYSE-CM) ... learn more. Next, I will write about Transcontinental Inc (TSX-TCL, OTC-TCLAF) ... learn more on Wednesday, January 23, 2019 around 5 pm.

Also, on my book blog I have put a review of the book 21 Lessons for the 21st Century by Yuval Noah Harari. learn more...

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.

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