Something to Buy December 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 December 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. Four of these stocks (19%) 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), Leon's Furniture (TSX-LNF, OTC-LEFUF), and Stingray Digital Group Inc (TSX-RAY.A). Leon's Furniture (TSX-LNF, OTC-LEFUF) has been added to 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). There is no change from last month.

I follow 11 Consumer Staples stocks. No companies are showing as cheap by the historically high dividend yield. There is no change from last month.

Four stocks (or 36%) 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), and Metro Inc. (TSX-MRU, OTC-MTRAF). Saputo Inc. (TSX-SAP, OTC-SAPIF) has been removed from this list.

I only follow three Health Care stocks. None of these stocks are showing as cheap by the historically high dividend yield. Three or 100% are cheap by the historical median dividend yield. The stocks are Johnson and Johnson (NYSE-JNJ), Medtronic Inc. (NYSE-MDT) and HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF). HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF) has been added to this list.

I follow 10 Energy stocks. Three stock or 30% are showing as cheap by the historical high dividend yield. They are Canadian Natural Resources (TSX-CNQ, NYSE-CNQ), Mullen Group (TSX-MTL, OTC-MLLGF) and Ensign Energy Services (TSX-ESI, OTC-ESVIF). Canadian Natural Resources (TSX-CNQ, NYSE-CNQ) has been added to this list.

There are Five stocks (or 50%) showing cheap by historical median dividend yield. They are Canadian Natural Resources (TSX-CNQ, NYSE-CNQ), Cenovus Energy Inc. (TSX-CVE, NYSE-CVE), Crescent Point Energy Corp (TSX-CPG, NYSE-CPG), Ensign Energy Services (TSX-ESI, OTC-ESVIF), and Mullen Group (TSX-MTL, OTC-MLLGF). Crescent Point Energy Corp (TSX-CPG, NYSE-CPG) has been added to this list.

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). There is no change from last month.

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). There is no change from last month.

Eight (or 57%) 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), 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 removed from this list.

I follow 6 Insurance stocks. One (or 17%) is showing as cheap by the historically high dividend yield. That stock is Power Financial Corp (TSX-PWF, OTC-POFNF). There is no change from last month.

Five stocks (or 83%) 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), 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 removed from 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). There is no change from last month.

I follow 8 Material stocks. None are showing as cheap by the historically high dividend yield. Four stock or 50% are showing as cheap by historical median dividend yield. The stocks are Chemtrade Logistics Inc. Fund (TSX-CHE.UN, OTC-CGIFF), Hardwoods Distribution Inc. (TSX-HDI, OTC-HDIUF), Methanex Corp (TSX-MX, NASDAQ- MEOH) and Stella-Jones (TSX-SJ, OTC-STLJF). Barrick Gold Corp (TSX-ABX, NYSE-ABX) has been removed and Methanex Corp (TSX-MX, NASDAQ- MEOH) has been added.

I follow 10 Real Estate stocks. None of these stocks is showing as cheap by the historically high dividend yield. Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF) has been removed from this list. Four stocks (or 40%) are showing cheap by historical median dividend yield. They are 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), and Melcor Developments Inc. (TSX-MRD, OTC-MODVF). Artis REIT (TSX-AX.UN, OTC-ARESF) and SmartCentres REIT (TSX-SRU.UN, OTC-CWYUF).have been removed from this list.

I follow 4 of the Telecom Service stocks. No stocks are showing as cheap by historically high dividend yield. Four stocks (or 100%) are showing cheap by historical median dividend yield. These stocks are BCE (TSX-BCE, NYSE-BCE), Quarterhaill Inc (TSX-QTRH, NASDAQ-QTRH), Shaw Communications Inc. (TSX-SJR.B, NYSE-SJR) and Telus Corp (TSX-T, NYSE-TU). Quarterhaill Inc (TSX-QTRH, NASDAQ-QTRH) has been added to this list.

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. There is no change from last month.

I follow 6 of the Infrastructure type utility companies. Enbridge Income Fund Holdings Inc (TSX-ENF, OTC-EBGUF) has been removed from this list as it has been bought out by Enbridge Inc. None are showing as cheap by historical high dividend yield.

Four stocks (or 67%) are showing cheap by historical median dividend yield. They are AltaGas Ltd (TSX-ALA, OTC-ATGFF), Enbridge Inc. (TSX-ENB, NYSE-ENB), OTC-EBGUF), Keyera Corp (TSX-KEY, OTC-KEYUF) and TransCanada Corp (TSX-TRP, NYSE-TRP). Enbridge Income Fund Holdings Inc (TSX-ENF, OTC-EBGUF) has been removed from this list as it has been bought out by Enbridge Inc.

I follow 11 of the Power type utility companies. 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 Northland Power Inc. (TSX-NPI, OTC-NPIFF) ... learn more. Next, I will write about DHX Media Ltd (TSX-DHX, OTC-DHXMF) ... learn more on December 7, 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.

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