Thursday, November 8, 2018

Something to Buy November 2018

There is always something to buy in the stock market. On Tuesday, I put out a list of the stocks that I covered and showed what stock might be a good deal based on dividend yield. Now I am trying to categorize what sorts of stocks may be a good deal based on dividend yield.

The advantages to using dividend yield to judge how cheap or expensive a stock is, is that you are not using estimates or old data (like last reported quarter's data). You are using today's stock price and today's dividend yield.

For other testing, like using P/E Ratios and Price/Graham Price Ratios, you use EPS estimates or from the last reported financial quarter. When using P/S Ratios, P/CF Ratios or P/BV Ratios you are using data from the last reported financial quarter.

This system does not work well for old Income Trust companies. These companies had quite high Dividend Yields which will probably never be seen again. So, I 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. For these stocks, you might be better comparing the current dividend yield to the 5 year median dividend yield.

However, no system is perfect. But if you are interested in buying a stock a list of stocks cheap or reasonable using dividend yield data might be a good place to start.

Categorizing stocks is not as simple as it might seem. Every site you go to has categorized stocks a bit differently. I try to keep this as simple as possible. See Something to Buy November 2018 Spreadsheet to see what stocks are 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). As in other spreadsheets, you can highlight a line or a number of lines for better viewing.

In the following notes I am only going to list stocks showing as cheap using the historical high dividend yields (P/Hi) and historical median dividend yields (P/Med

I now follow 21 stocks in the Consumer Discretionary category. Newfoundland Capital Corp (TSX-NCC.A) has been bought out by Stingray Digital Group Inc (TSX-RAY.A). Three of these stocks (14%) are showing as cheap by the historically high dividend yield and they are Dorel Industries (TSX-DII.B, OTC-DIIBF), High Liner Foods (TSX-HLF, OTC-HLNFF) and Stingray Digital Group Inc (TSX-RAY.A). DHX Media Ltd. (TSX-DHX, OTC-DHXMF) has been removed from this list as they have suspended their dividends. Newfoundland Capital Corp (TSX-NCC.A) has also been removed from this list.

Nine (or 43%) of Consumer Discretionary are showing cheap by historical median dividend yield. They are Canadian Tire Corp (TSX-CTC.A, OTC-CDNAF), Dorel Industries (TSX-DII.B, OTC-DIIBF), High Liner Foods (TSX-HLF, OTC-HLNFF), Leon's Furniture (TSX-LNF, OTC-LEFUF), Magna International Inc. (TSX-MG, NYSE-MGA), Molson Coors Canada (TSX-TPX.B, NYSE-TAP), Pizza Pizza Royalty Corp (TSX-PZA, OTC-PZRIF), Reitmans (Canada) Ltd. (TSX-RET.A, OTC-RTMAF) and Stingray Digital Group Inc (TSX-RAY.A). DHX Media Ltd. (TSX-DHX, OTC-DHXMF) has been removed from this list as they have suspended their dividends. Newfoundland Capital Corp (TSX-NCC.A) has also been removed from this list.

I follow 11 Consumer Staples stocks. No companies are showing as cheap by the historically high dividend yield. Five stocks (or 46%) are showing cheap by historical median dividend yield. These are AGT Food and Ingredients Inc. (TSX-AGT, OTC-AGXXF), Empire Company Ltd (TSX-EMP.A, OTC-EMLAF), Loblaw Companies (TSX-L, OTC-LBLCF), Metro Inc. (TSX-MRU, OTC-MTRAF) and Saputo Inc. (TSX-SAP, OTC-SAPIF). There is no change from last month.

I only follow three Health Care stocks. None of these stocks are showing as cheap by the historically high dividend yield. Two or 67% are cheap by the historical median dividend yield. The stocks are Johnson and Johnson (NYSE-JNJ) and Medtronic Inc. (NYSE-MDT). There is no change from last month.

I follow 10 Energy stocks. Two stock or 20% are showing as cheap by the historical high dividend yield. They are Mullen Group (TSX-MTL, OTC-MLLGF) and Ensign Energy Services (TSX-ESI, OTC-ESVIF). Ensign Energy Services (TSX-ESI, OTC-ESVIF) has been added to this list.

There are four stocks (or 40%) showing cheap by historical median dividend yield. They are Canadian Natural Resources (TSX-CNQ, NYSE-CNQ), Cenovus Energy Inc. (TSX-CVE, NYSE-CVE), Ensign Energy Services (TSX-ESI, OTC-ESVIF), and Mullen Group (TSX-MTL, OTC-MLLGF). There is no change from last month.

I follow 8 Bank stocks. None are showing as cheap by the historically high dividend yield. Five stocks (or 63%) are showing cheap by historical median dividend yield. They are Bank of Nova Scotia (TSX-BNS, NYSE-BNS), CIBC (TSX-CM, NYSE-CM), National Bank of Canada (TSX-NA, OTC-NTIOF), Royal Bank (TSX-RY, NYSE-RY), and Toronto Dominion Bank (TSX-TD, NYSE-TD). National Bank of Canada (TSX-NA, OTC-NTIOF), Royal Bank (TSX-RY, NYSE-RY), and Toronto Dominion Bank (TSX-TD, NYSE-TD) have been added to this list.

I follow 14 Financial Service stocks. Two or 14% are showing as cheap by the historically high dividend yield. These are Gluskin Sheff + Associates Inc. (TSX-GS, OTC-GLUSF) and Power Corp (TSX-POW, OTC-PWCDF).

Nine (or 64%) stocks are showing cheap by the historical median dividend yield. These stocks are Accord Financial Corp (TSX-ACD, OTC-ACCFF), AGF Management Ltd (TSX-AGF.B, OTC-AGFMF), Alaris Royalty Corp (TSX-AD, OTC-ALARF), Chesswood Group (TSX-CHW, OTC-CHWWF), CI Financial (TSX-CIX, OTC-CIFAF), Equitable Group Inc. (TSX-EQB, OTC-EQGPF), Gluskin Sheff + Associates Inc. (TSX-GS, OTC-GLUSF), IGM Financial (TSX-IGM, OTC-IGIFF) and Power Corp (TSX-POW, OTC-PWCDF). Chesswood Group (TSX-CHW, OTC-CHWWF) has been added to this list.

I follow 6 Insurance stocks. One is showing as cheap by the historically high dividend yield. It is Power Financial Corp (TSX-PWF, OTC-POFNF). Power Financial Corp (TSX-PWF, OTC-POFNF) has been added this month.

Six stocks (or 100%) are showing cheap by historical median dividend yield. These stocks are Great-West Lifeco Inc. (TSX-GWO, OTC-GWLIF), Industrial Alliance Ins. and Fin. (TSX-IAG, OTC-IDLLF), Intact Financial Corp. (TSX-IFC, OTC-IFCZF), Manulife Financial Corp (TSX-MFC, NYSE-MFC), Power Financial Corp (TSX-PWF, OTC-POFNF) and Sun Life Financial (TSX-SLF, NYSE-SLF). Intact Financial Corp. (TSX-IFC, OTC-IFCZF) has been added back to this list.

I follow 32 Industrial stocks. Because I have so many and Industrial is not very descriptive, I have divided my Industrial stocks into 4 separate categories under Industrial. They are Construction, Industrial, Manufacturing and (Business) Services.

I have 6 Construction stocks. None are cheap by the historically high dividend yield. Two stocks or 33% are showing as cheap by historical median dividend yield. They are SNC-Lavalin (TSX-SNC, OTC-SNCAF) and Stantec Inc. (TSX-STN, NYSE-STN). There is no change from last month.

I have 3 stocks I have left with the sub-index of Industrial. None are cheap by the historically high dividend yield. Two stocks or 67% are showing as cheap by historical median dividend yield. They are Finning International Inc. (TSX-FTT, OTC-FINGF), and Russel Metals (TSX-RUS, OTC-RUSMF). There is no change from last month.

I have 7 Manufacturing stocks. None are showing as cheap by the historically high dividend yield. Four stocks or 57% are showing as cheap by historical median dividend yield. They are Exco Technologies Ltd. (TSX-XTC, OTC-EXCOF), Hammond Power Solutions Inc. (TSX-HPS.A, OTC-HMDPF), Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF) and PFB Corp (TSX-PFB, OTC-PFBOF). There is no change from last month.

I follow 16 Services stocks. None are showing as cheap by the historically high dividend yield. Five stocks or 31% are showing as cheap by historical median dividend yield. These stocks are Canadian National Railway (TSX-CNR, NYSE-CNI), Pason Systems Inc. (TSX-PSI, OTC-PSYTF), Ritchie Bros Auctioneers Inc. (TSX-RBA, NYSE-RBA), Transcontinental Inc. (TSX-TCL.A, OTC-TCLAF) and Wajax Corp (TSX-WJX, OTC-WJXFF). Wajax Corp (TSX-WJX, OTC-WJXFF) has been added to this list. Last month there was only 4 not 5 stocks in this category.

I follow 8 Material stocks. None are showing as cheap by the historically high dividend yield. Three stock or 38% are showing as cheap by historical median dividend yield. The stocks are Barrick Gold Corp (TSX-ABX, NYSE-ABX), Hardwoods Distribution Inc. (TSX-HDI, OTC-HDIUF) and Stella-Jones (TSX-SJ, OTC-STLJF). Stella-Jones (TSX-SJ, OTC-STLJF) has been added to this list.

I follow 10 Real Estate stocks. One of these stocks is showing as cheap by the historically high dividend yield. The stock is Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF). Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF) has been added to this list.

Six stocks (or 60%) are showing cheap by historical median dividend yield. They are Artis REIT (TSX-AX.UN, OTC- ARESF), Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF), Granite Real Estate (TSX-GRT.UN, NYSE-GRP.U), H & R REIT (TSX-HR.UN, OTC-HRUFF), Melcor Developments Inc. (TSX-MRD, OTC-MODVF), and SmartCentres REIT (TSX-SRU.UN, OTC-CWYUF). SmartCentres REIT (TSX-SRU.UN, OTC-CWYUF) has been added to this list.

I follow 4 of the Telecom Service stocks. No stocks are showing as cheap by historically high dividend yield. Three stocks (or 75%) are showing cheap by historical median dividend yield. These stocks are BCE (TSX-BCE, NYSE-BCE), Shaw Communications Inc. (TSX-SJR.B, NYSE-SJR) and Telus Corp (TSX-T, NYSE-TU). There is no change from last month.

I follow 8 Info Tech stocks. One is showing as cheap by historical high dividend yield and that is Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR). There is no change from last month.

Four stocks (or 50%) are showing cheap by historical median dividend yield. They are Absolute Software Corporation (TSX-ABT, OTC-ALSWF) Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF), Evertz Technologies (TSX-ET, OTC-EVTZF) and Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR). There is no change from last month. The Tech sector is now Info Tech.

I follow 7 of the Infrastructure type utility companies. None are showing as cheap by historical high dividend yield. Five stocks (or 71%) are showing cheap by historical median dividend yield. They are AltaGas Ltd (TSX-ALA, OTC-ATGFF), Enbridge Inc. (TSX-ENB, NYSE-ENB), Enbridge Income Fund Holdings Inc (TSX-ENF, OTC-EBGUF), Keyera Corp (TSX-KEY, OTC-KEYUF) and TransCanada Corp (TSX-TRP, NYSE-TRP). Keyera Corp (TSX-KEY, OTC-KEYUF) has been added to this list.

I follow 11 of the Power type utility companies. EnerCare Inc (TSX-ECI, OTC-CSUWF) has been bought by Brookfield Infrastructure Partners L. P. (TSX-BIP.UN, NYSE-BIP) so this has reduced this Power Sector from 12 to 11. Only ATCO Ltd (TSX-ACO.X, OTC-ACLLF) is showing as cheap by the historically high dividend yield. This has not changed from last month.

Five stocks (or 45%) are showing cheap by historical median dividend yield. Those stocks are ATCO Ltd (TSX-ACO.X, OTC-ACLLF), Canadian Utilities Ltd (TSX-CU, OTC-CDUAF) and Emera Inc. (TSX-EMA, OTC-EMRAF), Fortis Inc. (TSX-FTS, OTC-FRTSF) and Just Energy Group Inc. (TSX-JE, NYSE-JE). This has not changed from last month.

On my other blog I wrote yesterday about Dollarama Inc. (TSX-DOL, OTC-DLMAF) ... learn more. Next, I will write about Keyera Corp. (TSX-KEY, OTC-KEYUF) ... learn more on Friday, November 9, 2018 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 site for an index to these blog entries and for stocks followed. 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. I am on Instagram. Or you can just Google #walktoronto spbrunner8166 to see my pictures.

1 comment:

  1. Hi Susan, thanks for all this work you are doing it is much appreciated. I have a question about selling stocks in your RRIF for annual withdrawals. If you have to decide weather to sell stocks that have increased the most and are winners but that are under represented in your porfolio or stocks that have gone down in price but are over represented in your portfolio - which would you choose? Thanks in advance.

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