Banks and Other Things

For dividend paying stocks, the Dividend Payout Ratios are important. For the DPRs, lower ratios are better ratios. For Banks the DPR for EPS is the most important one. When looking at these ratios, it would appear that Nation Bank has the best one, which is the lowest one. However, last year the National Bank had the highest at 65%. The DPR payout expect is in the 40 to 55% level.

The problem with cash flow is that for banks they tend to be volatile and often negative. A lot of analysts ignore the Cash Flow of banks.

Bank 2018	Symbol	DPR for EPS	DPR for CFPS
Bank of Montreal	BMO	45.53%	47.75%
Bank of Nova Scotia	BNS	48.09%	22.60%
CIBC	CM	45.67%	23.88%
Royal Bank	RY	44.26%	30.47%
National Bank	NA	40.40%	13.71%
TD Bank	TD	43.43%	83.92%

When Shares are issued for Stock Options, you want a company that issues around the same relative number of shares for its industry. Of course, the lower the number of shares issued for stock options, the less money comes out of the earnings for shareholders. In the value column, I am putting in the book value of the stock options at the end of the calendar year.

In 2018 RY has one of the lowest percentages of their shares issued for stock options purposes. Last year CIBC has the lowest percentage. RY options also had the lowest book value cost when it came to the cost of these stock options. For 2018 NB has the highest percentage of their shares issued for stock purposes and TD the highest cost.

Bank 2018	Symbol	Shares	‘% of Shares	Value $M
Bank of Montreal	BMO	1.513	0.24%	$99
Bank of Nova Scotia	BNS	2.238	0.18%	$135
CIBC	CM	1.000	0.23%	$95
Royal Bank	RY	1.466	0.10%	$92
National Bank	NA	3.130	0.93%	$128
TD Bank	TD	2.900	0.16%	$152

Since I was looking for performance on a long term basis this year, I want to include the dividend growth and total return for the 6 banks that I cover.

Below is a chart showing the long term growth of dividends for these banks. Certainly, in most cases the 15 to 25 years growth is better than the 5 and 10 years growth. The TD Bank has the best ones over each period, but Royal Bank is not far behind.

Bank 2018	Symbol	5 Yr	10 Yr	15 Yr	20 Yr	25 Yr
Bank of Montreal	BMO	4.96%	2.88%	7.04%	7.47%	7.91%
Bank of Nova Scotia	BNS	6.54%	5.50%	9.51%	11.09%	10.34%
CIBC	CM	6.96%	4.34%	8.16%	7.73%	8.71%
Royal Bank	RY	7.27%	6.96%	9.46%	11.19%	10.98%
National Bank	NA	7.65%	6.91%	10.59%	10.60%	10.45%
TD Bank	TD	10.01%	8.26%	10.55%	10.89%	11.05%

The other thing I looked at was long term total return. This is calculated from December to December. It will include both capital gains and dividends. It is a compound growth rate per year. Here I am looking for total return of 8% or more. Mostly the banks did that but with a few exceptions like BNS in the 5 year total return range.

Bank 2018	Symbol	5 Yr	10 Yr	15 Yr	20 Yr	25 Yr
Bank of Montreal	BMO	9.05%	17.56%	7.51%	9.71%	12.89%
Bank of Nova Scotia	BNS	4.78%	12.79%	9.43%	11.84%	14.17%
CIBC	CM	7.19%	13.04%	7.62%	9.67%	13.10%
Royal Bank	RY	9.55%	14.77%	11.96%	12.27%	15.60%
National Bank	NA	10.44%	20.52%	11.02%	12.07%	14.54%
TD Bank	TD	10.12%	16.85%	11.87%	12.08%	18.72%

The last thing to cover is how well the banks cover their deposits with assets. BNS has an abnormally high coverage this year. For them the coverage was in the 0.90 range for other years.

Bank 2018	Symbol	Deposits Cov
Bank of Montreal	BMO	0.91
Bank of Nova Scotia	BNS	0.41
CIBC	CM	0.89
Royal Bank	RY	0.72
National Bank	NA	0.75
TD Bank	TD	0.85

On my other blog I wrote yesterday about Home Capital Group (TSX-HCG, OTC-HMCBF) ... learn more. Next, I will write about Bombardier Inc. (TSX-BBD.B, OTC-BDRBF) ... learn more on Friday, March 1, 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 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.

Four Advisor Stocks

Daily Buy and Sell Advise\or has recommended two Transportation and Logistics stocks to buy. See their information on TFI International (TSX-TFII) and Canadian National Railway (TSX-CNR) here.

I am interested in these reviews as I own both stocks. I have own CNR for a long time but the TFI International stock is a recent buy.

In another report they talk about Alimentation Couche-Tard (TSX-ATD.B, OTC-ANCUF) and Metro Inc (TSX-MRU, OTC-MTRAF) here.

I follow Alimentation Couche-Tard and own Metro Inc.

On my other blog I wrote yesterday about Emera Inc. (TSX-EMA, OTC-EMRA) ... learn more. Next, I will write about Home Capital Group (TSX-HCG, OTC-HMCBF) ... learn more on Wednesday, February 27, 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 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.

Investing Now

At a recent investment club meeting I go to, one of the members said that he advised a family member who wanted to start investing in stocks, to instead put his money into GICs at present. He felt that now was not a good time to be buying stock. I could agree with his attitude. Personally, I am not investing any money at the present.

On the other hand, I am not selling anything. I do not sell because I am worried about a bear market coming. The only way I raise cash is by not buying anything. I do not sell stocks to raise cash for buying purposes in the next bear market. I do know people who do that and are now raising their cash levels.

We are due for a bear market and a recession. However, no one know when this will come. It could still be a few years off. Or, maybe not. One thing is sure is that this expansion is long in the tooth and currently investment will probably not provide a good return over the longer term. The thing is no one can guess when the next bear will hit and all analysts will put it off to the future, but then it is suddenly here.

We may be due for a bear market, but the current situation can play out for longer than you might ever think. Yes, you can get really good deals in a bear market and make some terrific returns, but you might also have to sit on money for years waiting for the next bear market.

In the meantime, I will wait and not buy and collect dividends on my investments. Last year was not a great year for the Canadian market. I am almost 100% in the Canadian market. I lost 7% on my portfolio, but my dividend income is up 12%.

Even though I do not think our market is overvalued as the American one is, our markets tend to fall at the same time as the American ones do. Sometimes we do the same as the American ones do (2008), sometimes we do have the same bear and recession as the US does (2000) and sometimes we do much worse (1990). We tend to have a bear market just after the US has one.

On my other blog I wrote yesterday about Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF) ... learn more. Next, I will write about Atrium Mortgage Investment Corp (TSX-AI, OTC-AMIVF) ... learn more on Friday, February 22, 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 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.

My Budgeting

Although I have a version of Quicken, I do my initial budget in a spreadsheet. Quicken is only good for entering the figures once you have them. A good budget covers what you have to spend (rent or mortgage payments, utilities, insurance), what you are going to spend (food costs) and allows you to pick and choose what you spend the remainder on.

I do my budging for the next year in December. I use last year’s tax form to estimate my tax for the year. By December I have a good idea what my income for the year in the various categories will be (like dividend income and CPP). I take out the required money from my RIF accounts and pay the tax estimate that I calculated.

The RIF money I take out is to cover the taxes of the current year and fund next year’s spending. So, at the end of 2018 I take out what I am supposed to out of RIF, I pay my 2018 taxes and use the rest to fund 2019. I top up my Reserve Fund, put money into my TFSA for 2019 (in January 2019) and extra go to buy stock for my trading account.

I have a reserve fund. This is for unexpected expenses. I do not have any medical coverage since I stopped working. What I seem to spend a lot on is dental care. As mentioned above, once I pay my taxes, I top up this reserve fund.

From my budget, I know how much I need for living expenses monthly. Mostly the dividends of the Trading Account can cover my monthly living expenses. I still need to take out a small amount from my Reserve Fund for current spending. Near the end of each month I transfer from my trading account the amount I need for living expenses for the following month.

One thing I worry about is that my income taxes have gone up by 14% per year over the past 5 years. This is due to the money I need to take out of my RIF accounts. However, the portion in my RIF accounts and other trading accounts has changed over the years. When I stopped working in 1999, I have 50% in RIF accounts and 50% in other accounts. Now the percentage is 40% in RIF accounts and 60% in other accounts.

On my other blog I wrote today about Manulife Financial Corp. (TSX-MFC, NYSE-MFC) ... learn more. Next, I will write about Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF) ... learn more on Wednesday, February 20, 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 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.

Ideal Retirement Budget

From what I have read about using the stock market to fund your retirement income is that you should budget to earn 8% per year and take out 4%. So, in my spreadsheet which includes my portfolio value at the end of each year and the amount I have taken out, I have a column that shows from the beginning year of retirement what would be my portfolio if I gain 8% and took out 4%.

Looking at my data, I have kept my withdrawals at or below 4%. The other part was hit and miss until year 13 of retirement. Currently my portfolio is higher than an 8% increase and 4% withdrawal would put it.

You hear a lot of about the withdrawal figure of 4% per year, but not as much about the fact that you need to earn 8% per year to take out 4% per year. I was taking out just under 4% when I retired, but I did stop working in 1999. My problem is that hit the 2001 bear market soon after and then, of course, the 2008 bear market.

By the logic of the earnings 8% and taking out 4%, a portfolio should be going up 4% per year. However, by the end of 2002, my portfolio was down 4.21% per year. After the 2008 bear market I was up 2% per year.

After the 2001 bear market I thought I would be better off if I only took out an amount equal to or less than my dividend income. At that time, my yield was around 3%. I decided to increase my portfolio yield to 3.5% and only take out 3.5% or less. I did some switching to higher yielding stock and tried to limit the increase in my spending. It took be a few years and it was mostly because of the increase in dividend income that I accomplished my goal.

On my other blog I wrote yesterday about ARC Resources Ltd. (TSX-ARX, OTC-AETUF) ... learn more. Next, I will write about IGM Financial (TSX-IGM, OTC-IGIFF) ... learn more on Friday, February 15, 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 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.

Banks and Ratios 2

What I want to look at today is the relative stock price using different criterion between last year when I reviewed the banks and this year. What stock price testing is showing is that generally our banks are less expensive than last year. I do not think that the Canadian market is as relatively high historically as the US market currently is.

I will start off with my favourite measure of for determining if the current stock price is relatively good or not. My favourite measure is to compare the current dividend yield with the historical dividend yield. The last column shows difference between the current dividend yield and the historical median dividend yield.

What you want is a current dividend yield equal to or above the historical median dividend yield. For all banks this year, except for BMO, the current dividend yields were above the historical median dividend yield. The stock prices this year are reasonable and all but BMO is below are below the relative median.

Bank 2019	Symbol	Price	Dividend	Yield	Re Med
Bank of Montreal	BMO	$97.24	$4.00	4.11%	-4.11%
Bank of Nova Scotia	BNS	$73.57	$3.40	4.62%	12.72%
CIBC	CM	$110.24	$5.44	4.93%	13.70%
Royal Bank	RY	$99.06	$3.92	3.96%	7.24%
National Bank	NA	$60.86	$2.60	4.27%	8.43%
TD Bank	TD	$72.83	$2.68	3.68%	6.05%

Last year all the banks had a current dividend yield below the historical median dividend yield. The stock prices were reasonable but above the median.

Bank 2018	Symbol	Price	Dividend	Yield	Re Med
Bank of Montreal	BMO	$104.44	$3.72	3.56%	-16.97%
Bank of Nova Scotia	BNS	$81.99	$3.16	3.85%	-3.89%
CIBC	CM	$122.53	$5.20	4.24%	-1.08%
Royal Bank	RY	$107.72	$3.64	3.38%	-11.08%
National Bank	NA	$65.08	$2.40	3.69%	-7.34%
TD Bank	TD	$74.08	$2.40	3.24%	-4.71%

The next checking of the stock price I will look at is using the Price/Book Value per Share Ratio. Here you want the current P/B Ratio to be lower than the 10 year median P/B. Ratio. Here the last column shows how much above or below the current P/B Ratio is compared to the 10 year median P/B Ratio.

In this test for 2019, the banks of BNS, CIBC and RY showed a price that was reasonable and below the median. For BMO, National Bank and TD the price is relatively reasonable but above the median. Prices are again relatively cheaper in 2019.

Bank 2019	Symbol	Price	BVPS	Current P/B	Re Med
Bank of Montreal	BMO	$97.24	$64.73	1.50	3.60%
Bank of Nova Scotia	BNS	$73.57	$49.75	1.48	-20.07%
CIBC	CM	$110.24	$73.83	1.49	-22.23%
Royal Bank	RY	$99.06	$51.11	1.94	-2.11%
National Bank	NA	$60.86	$34.40	1.77	1.68%
TD Bank	TD	$72.83	$40.45	1.80	11.83%

In this test for 2018 only BNS and CIBC showed a price that was reasonable and below the median. For BMO and Royal Bank, the price is relatively reasonable but above the median. For National Bank and TD, the stock price is showing as relatively expensive. Price is relatively expensive if the difference between the current P/B and 10 year median is 20% or more.

Bank 2018	Symbol	Price	BVPS	Current P/B	Re Med
Bank of Montreal	BMO	$104.44	$63.47	1.65	11.95%
Bank of Nova Scotia	BNS	$81.99	$46.24	1.77	-5.69%
CIBC	CM	$122.53	$66.55	1.84	-6.06%
Royal Bank	RY	$107.72	$46.41	2.32	14.90%
National Bank	NA	$65.08	$31.51	2.07	24.43%
TD Bank	TD	$74.08	$37.89	1.96	21.45%

In another test I look at the Price/Graham Price Ratio compared to the 10 year median P/GP Ratio. You want the current P/GP Ratio to be lower than the 10 year median P/GP Ratio. Here again the last column says how much the current P/GP Ratio is above or below the 10 year median P/GP Ratio.

In 2019, all the banks but BMO has a lower price than the median. This mean they are showing as reasonable and below the median. CIBC is almost cheap. This testing again shows that the 2019 prices are relatively cheaper than the 2018 where only one bank, CIBC has a price below the median.

Bank 2019	Symbol	Price	Graham Price	P/GP Ratio	Re Med
Bank of Montreal	BMO	$97.24	$113.47	0.86	2.02%
Bank of Nova Scotia	BNS	$73.57	$90.21	0.82	-11.35%
CIBC	CM	$110.24	$144.96	0.76	-19.10%
Royal Bank	RY	$99.06	$101.51	0.98	-5.26%
National Bank	NA	$60.86	$69.77	0.87	-0.88%
TD Bank	TD	$72.83	$78.56	0.93	-4.43%

In the 2018 testing only CIBC had a current P/GP Ratio lower than the 10 year median P/GP Ratio. In 2018 all the other banks were showing a stock price that was relatively reasonable but above the median.

Bank 2018	Symbol	Price	Graham Price	P/GP Ratio	Re Med
Bank of Montreal	BMO	$104.44	$108.87	0.96	11.55%
Bank of Nova Scotia	BNS	$81.99	$81.51	1.01	8.16%
CIBC	CM	$122.53	$128.34	0.95	-1.57%
Royal Bank	RY	$107.72	$91.12	1.18	9.46%
National Bank	NA	$65.08	$63.90	1.02	18.42%
TD Bank	TD	$74.08	$68.66	1.08	11.23%

The last test on stock price test to look at is to compare the current Price/Earnings Ratio to the 5 year median P/E Ratio. In this test for 2019, all the banks are showing a price that is relatively reasonable and below the median. Here again, the 2019 bank prices are relatively better than in 2018.

Bank 2019	Symbol	Price	2019 EPS Est.	Curr P/E	Re Med
Bank of Montreal	BMO	$97.24	$8.84	11.00	-3.68%
Bank of Nova Scotia	BNS	$73.57	$7.27	10.12	-10.37%
CIBC	CM	$110.24	$12.65	8.71	-13.55%
Royal Bank	RY	$99.06	$8.96	11.06	-8.55%
National Bank	NA	$60.86	$6.29	9.68	-8.89%
TD Bank	TD	$72.83	$6.78	10.74	-13.44%

In 2018 the stock price is showing as relatively reasonable, but above the median for all banks. In 2018 the TD bank’s current ratio is the closes to the 5 year median.

Bank 2018	Symbol	Price	2018 EPS Est.	Curr P/E	Re Med
Bank of Montreal	BMO	$104.44	$8.30	12.58	10.19%
Bank of Nova Scotia	BNS	$81.99	$6.39	12.84	13.44%
CIBC	CM	$122.53	$11.00	11.14	12.62%
Royal Bank	RY	$107.72	$7.95	13.55	18.44%
National Bank	NA	$65.08	$5.76	11.30	6.39%
TD Bank	TD	$74.08	$5.53	13.40	6.07%

On my other blog I wrote yesterday about Absolute Software Corporation (TSX-ABT, OTC-ALSWF) ... learn more. Next, I will write about ARC Resources Ltd. (TSX-ARX, OTC-AETUF) ... learn more on Wednesday, February 13, 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 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.

Something to Buy February 2019

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 February 2019 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 22 stocks in the Consumer Discretionary category. Four of these stocks (18%) 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). There is no change from last month.

Ten (or 45%) of Consumer Discretionary are showing cheap by historical median dividend yield. They are Alcanna Inc (TSX-CLIQ, OTC-LQSIF), 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). Goeasy Ltd (TSX-GSY, OTC-EHMEF) and Thomson Reuters Corp (TSX-TRI, NYSE-TRI has been deleted from this list.

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.

Five stocks (or 45%) 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. One stock (or 33%) of these stocks is showing as cheap by the historically high dividend yield. That stock is HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF). There is no change from last month.

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). There is no change from last month

I follow 10 Energy stocks. Four stock or 40% are showing as cheap by the historical high dividend yield. They are Canadian Natural Resources (TSX-CNQ, NYSE-CNQ), Ensign Energy Services (TSX-ESI, OTC-ESVIF), and Mullen Group (TSX-MTL, OTC-MLLGF). Suncor Energy (TSX-SU, NYSE-SU) has been deleted from 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), Ensign Energy Services (TSX-ESI, OTC-ESVIF), Mullen Group (TSX-MTL, OTC-MLLGF) and Suncor Energy (TSX-SU, NYSE-SU). Crescent Point Energy Corp (TSX-CPG, NYSE-CPG) has been deleted from this list.

I follow 8 Bank stocks. None are showing as cheap by the historically high dividend yield. There is no change from last month.

Four stocks (or 50%) 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). Bank of Montreal (TSX-BMO, NYSE-BMO), and Barclays PLC (LSE-BARC, NYSE-BCS were deleted from this list.

I follow 15 Financial Service stocks. Two or 13% 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). Element Fleet Management Corp (TSX-EFN, OTC-ELEEF) has been deleted from this list.

Nine (or 60%) 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), Element Fleet Management Corp (TSX-EFN, OTC-ELEEF), 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), TMX Group Ltd. (TSX-X, OTC-TMXXF) has been deleted 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.

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). There is no change from last month.

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. One stock or 17% is showing as cheap by the historically high dividend yield. That stock is SNC-Lavalin (TSX-SNC, OTC-SNCAF). SNC-Lavalin (TSX-SNC, OTC-SNCAF) has been added to this list.

Three stocks or 50% are showing as cheap by historical median dividend yield. They are Bird Construction Inc (TSX-BDT, OTC-BIRDF), 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. There is no change from last month.

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. This has not changed from last month.

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. This has not changed from last month.

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. This has not changed from last month.

Five stock or 63% are showing as cheap by historical median dividend yield. The stocks are Barrick Gold Corp (TSX-ABX, NYSE-ABX), Chemtrade Logistics Inc. Fund (TSX-CHE.UN, OTC-CGIFF), Hardwoods Distribution Inc. (TSX-HDI, OTC-HDIUF), and Stella-Jones (TSX-SJ, OTC-STLJF). Methanex Corp (TSX-MX, NASDAQ- MEOH) has been deleted from this list.

I follow 10 Real Estate stocks. None are showing as cheap by historically high dividend yield. Choice Properties REIT (TSX-CHP.UN, OTC-PPRQF) has been deleted 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), and Melcor Developments Inc. (TSX-MRD, OTC-MODVF). H & R REIT (TSX-HR.UN, OTC-HRUFF) has been deleted from this list.

I follow 4 of the Telecom Service stocks. No stocks are showing as cheap by historically high dividend yield. This has not changed from last month.

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). This has not changed 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.

Five stocks (or 63%) 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), Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR), and Sylogist Ltd (TSXV-SYZ, OTC-SYZLF).

I follow 6 of the Infrastructure type utility companies. None are showing as cheap by historical high dividend yield. This has not changed from last month.

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). Inter Pipeline Ltd (TSX-IPL, OTC-IPPLF) has been deleted from this list.

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 Exco Technologies Ltd (TSX-XTC, OTC-EXCOF) ... learn more. Next, I will write about Canadian National Railway (TSX-CNR, NYSE-CNI) ... learn more on Friday, February 8, 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 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.

Dividend Stocks February 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 February 2019. On this list,

• 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 last list in January 2019,

• I have 17 stocks with a dividend yield higher than the historical high dividend yield,
• I have 59 stocks with a dividend yield higher than the historical average dividend yield
• I have 92 stocks with a dividend yield higher than the historical median dividend yield and
• 110 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 6 stocks has raised their dividends since last month.

ATCO Ltd (TSX-ACO.X, OTC-ACLLF)
Canadian National Railway (TSX-CNR, NYSE-CNI)
Canadian Utilities Ltd (TSX-CU, OTC-CDUAF)
Exco Technologies Ltd. (TSX-XTC, OTC-EXCOF)

Metro Inc (TSX-MRU, OTC-MTRAF)
Richelieu Hardware Ltd. (TSX-RCH, OTC-RHUHF)

Of the stocks I follow, one stock has cut their dividends. That stock is Crescent Point Energy Corp (TSX-CPG, NYSE-CPG)

Enghouse Systems Limited (TSX-ENGH, OTC-EGHSF) did a two for one split effective January 25, 2019.

Most stock has price increases, but there were a few exceptions. One that strongly moved down was Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR). Last month the stock price was $16.07 but now it is $7.32. The dividend has not changed, at least not yet and the yield is at 20.22%. Maxar Technologies Inc is an integrated space and geospatial intelligence company. See what analysts are saying on Stock Chase.

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 AGF Management Ltd (TSX-AGF.B, OTC-AGFMF) ... learn more. Next, I will write about Exco Technologies Ltd (TSX-XTC, OTC-EXCOF) ... learn more on Wednesday, February 06 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.