I found this article by Jared Dillian on Mauldin Economics interesting. I often read articles from Maudlin Economics. The authors on this site write about economics and investing. It is an American company, so they do have an American perspective. This article is called Yes, the Personal Finance Industry Is a Scam.
On my other blog I wrote yesterday about Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF) ... learn more. Next, I will write about Parkland Fuel Corp (TSX-PKI, OTC-PKIUF) ... learn more on Friday, June 28, 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.
Thursday, June 27, 2019
Tuesday, June 25, 2019
Selling in a Bear Market
Sometimes it can make sense to sell in a bear market. Say you like a stock (A) that you have following better than a stock (B) you have. If you sell stock B in bear market you will have lower capital gains or higher capital loss that selling in a normal or high market. If you buy stock A in a bear market you will be paying a lower price than in a normal or high market.
The kicker is that you would be better off doing this transaction in a bear market. Stock tend to trade relatively at the same price ratio. Say stock B trades about 10% lower than stock A. If in a bear market stocks fall 40%, all stocks tend to fall 40%. In a bear market 10% of the lower figures is less than it is of a higher figure. So, in absolute dollar terms you are ahead in doing the trade in a bear market.
On my other blog I wrote yesterday about CI Financial Corp (TSX-CIX, OTC-CIFAF) ... learn more. Next, I will write about Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF) ... learn more on Wednesday, June 26, 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.
The kicker is that you would be better off doing this transaction in a bear market. Stock tend to trade relatively at the same price ratio. Say stock B trades about 10% lower than stock A. If in a bear market stocks fall 40%, all stocks tend to fall 40%. In a bear market 10% of the lower figures is less than it is of a higher figure. So, in absolute dollar terms you are ahead in doing the trade in a bear market.
On my other blog I wrote yesterday about CI Financial Corp (TSX-CIX, OTC-CIFAF) ... learn more. Next, I will write about Computer Modelling Group Ltd. (TSX-CMG, OTC-CMDXF) ... learn more on Wednesday, June 26, 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.
Thursday, June 20, 2019
Why I am Not Buying Bonds
When I was into bonds, I took the advice that I had read about concerning them, which was basically do not trade in bonds, but buy and hold them until maturity. If you buy and hold them to maturity, you get what they said you were going to get when you buy the bond.
With bonds there is interest income, but your capital will not grow. Bondholder can default and then you lose the rest of the interest due and some or possibly all your capital for that bond. Hopefully the interest earned on your other bonds will cover this loss. Hopefully, you have a diversified bond portfolio.
At one time, bonds paid very good interest. I should tell you that I sold my last bond in 2007. It was a 30 year CIBC bond paying 9.65% interest. I sold it before it was due because I saw no point in holding it any longer. It was a $50,000 bond currently worth $61,250 when I sold. The value of the bond would just be going down until maturity because at maturity it would be worth $50,000.
The thing with bonds was that the bond market is more volatile than the stock market. At least that was my experience. Capital value of a bond and interest rates go in the opposite direction. If interest rates are falling, the value of the bond goes up. If interest rates are going up, the value of the bond goes down. The longer the term to maturity for a bond, the more that interest rates will change the value of a bond.
I do not understand why anyone would buy a bond Mutual Fund or ETF. Things have been fine for a very long time because we have had this long bull market in bonds due to the interest rate dropping. At some point this bull market in bonds will come to an end. If you trade in bonds in a rising interest rate environment you can lose more in capital than you gain in interest. Bond Mutual Funds and ETF do trade in the open bond market.
I am not into bonds at the moment because of the very low interest rates and because at some time this bull market in bonds will end. I have been waiting for the end for some time, but I am patient. What cannot go on forever, will eventually stop and this applies to historically very low interest rates. However, these things can go on for much longer than ever expect.
On my other blog I wrote yesterday about Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF) ... learn more. Next, I will write about Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN) ... learn more on Friday, June 21, 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.
With bonds there is interest income, but your capital will not grow. Bondholder can default and then you lose the rest of the interest due and some or possibly all your capital for that bond. Hopefully the interest earned on your other bonds will cover this loss. Hopefully, you have a diversified bond portfolio.
At one time, bonds paid very good interest. I should tell you that I sold my last bond in 2007. It was a 30 year CIBC bond paying 9.65% interest. I sold it before it was due because I saw no point in holding it any longer. It was a $50,000 bond currently worth $61,250 when I sold. The value of the bond would just be going down until maturity because at maturity it would be worth $50,000.
The thing with bonds was that the bond market is more volatile than the stock market. At least that was my experience. Capital value of a bond and interest rates go in the opposite direction. If interest rates are falling, the value of the bond goes up. If interest rates are going up, the value of the bond goes down. The longer the term to maturity for a bond, the more that interest rates will change the value of a bond.
I do not understand why anyone would buy a bond Mutual Fund or ETF. Things have been fine for a very long time because we have had this long bull market in bonds due to the interest rate dropping. At some point this bull market in bonds will come to an end. If you trade in bonds in a rising interest rate environment you can lose more in capital than you gain in interest. Bond Mutual Funds and ETF do trade in the open bond market.
I am not into bonds at the moment because of the very low interest rates and because at some time this bull market in bonds will end. I have been waiting for the end for some time, but I am patient. What cannot go on forever, will eventually stop and this applies to historically very low interest rates. However, these things can go on for much longer than ever expect.
On my other blog I wrote yesterday about Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF) ... learn more. Next, I will write about Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN) ... learn more on Friday, June 21, 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.
Tuesday, June 18, 2019
Toronto Money Show
I attend the Toronto Money Show each year and I find it a worthwhile event. I do my own stock investigations and have mine own opinion on where the stocks I follow are going to go and also where I think the TSX is at. However, it is always worthwhile to listen to the view of others. This is the link to Toronto Money Show for a free ticket.
On my other blog I wrote yesterday about Waste Connections Inc. (TSX-WCN, NYSE-WCN) ... learn more. Next, I will write about Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF) ... learn more on Wednesday, June 19, 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.
On my other blog I wrote yesterday about Waste Connections Inc. (TSX-WCN, NYSE-WCN) ... learn more. Next, I will write about Intertape Polymer Group Inc. (TSX-ITP, OTC-ITPOF) ... learn more on Wednesday, June 19, 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.
Thursday, June 13, 2019
Gordon Pape and Brookfield
This article by Gordon Pape on Money Show talks about why you should be investing in the Brookfield spin-offs. I know a number of people who have invested in Brookfield spin-offs recently and they have done fine.
I only follow Brookfield Asset Management (TSX-BAM.A, NYSE-BAM). I have followed this since 1987 and it has gone through a number of name changes and reorganizations over the years. I do not plan on following any of the spin-offs currently, although I have looking for another stock to follow.
On my other blog I wrote yesterday about Lassonde Industries (TSX-LAS.A, OTC-LSDAF) ... learn more. Next, I will write about Power Corp of Canada (TSX-POW, OTC-PWCDF) ... learn more on Friday, June 14, 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.
I only follow Brookfield Asset Management (TSX-BAM.A, NYSE-BAM). I have followed this since 1987 and it has gone through a number of name changes and reorganizations over the years. I do not plan on following any of the spin-offs currently, although I have looking for another stock to follow.
On my other blog I wrote yesterday about Lassonde Industries (TSX-LAS.A, OTC-LSDAF) ... learn more. Next, I will write about Power Corp of Canada (TSX-POW, OTC-PWCDF) ... learn more on Friday, June 14, 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.
Tuesday, June 11, 2019
Why Retail Investors Lose
Retail investors tend to invest most when the market is the highest and then cash out when the market drops. Therefore, they tend to buy high and sell low. It is buying high and selling low that is a losing strategy.
What investors should do is invest when the market is rising from a bear market. You should keep investing, but slowly when the market gets relatively high. There is usually something available at a reasonable price. But be cautious of buying at market tops.
Of course, no one knows when a bear market will be over. I have a tendency to buy before the bottom, but I get stocks at great prices and that is really what counts. Currently, I think that the market is relatively high, so I have not been investing much. When the next bear comes, I will just wait it out until stocks seem relatively low and then buy something.
Once a bear market starts, it is foolish to sell. This is how you lose. I know that bear markets can be scary, but this is how the stock market works. In the last two bear markets my portfolio went down 30%, but recovered within 2 years each time.
In a bear market, do not focus on the value of your stocks because they can be wildly out of line with how well your companies are doing. Focus on what your companies are actually doing. Focus on whether or not they can survive the bear market and following recession. Focus on their ability to pay your dividends.
I have found that each bear market is different and it affects different sectors of the market in different ways. You will have stocks that cut or suspend dividends. It will happen. You can do all the due diligence in investing your stock, but some stock will have problems that were unforeseen. It happens. It is not necessarily a time to sell these companies, but you have to look at their ability to survive and not be irreparable damaged by the recession.
In a bear market also, some companies will keep their dividends flat and yet others will raise theirs. It generally depends what sector they are in. To survive a bear market, you might want to reframe it into an adventure in investing. It can go from scary to exciting.
On my other blog I wrote yesterday about Goeasy Ltd (TSX-GSY, OTC-EHMEF) ... learn more. Next, I will write about Lassonde Industries (TSX-LAS.A, OTC-LSDAF) ... learn more on Wednesday, June 12, 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.
What investors should do is invest when the market is rising from a bear market. You should keep investing, but slowly when the market gets relatively high. There is usually something available at a reasonable price. But be cautious of buying at market tops.
Of course, no one knows when a bear market will be over. I have a tendency to buy before the bottom, but I get stocks at great prices and that is really what counts. Currently, I think that the market is relatively high, so I have not been investing much. When the next bear comes, I will just wait it out until stocks seem relatively low and then buy something.
Once a bear market starts, it is foolish to sell. This is how you lose. I know that bear markets can be scary, but this is how the stock market works. In the last two bear markets my portfolio went down 30%, but recovered within 2 years each time.
In a bear market, do not focus on the value of your stocks because they can be wildly out of line with how well your companies are doing. Focus on what your companies are actually doing. Focus on whether or not they can survive the bear market and following recession. Focus on their ability to pay your dividends.
I have found that each bear market is different and it affects different sectors of the market in different ways. You will have stocks that cut or suspend dividends. It will happen. You can do all the due diligence in investing your stock, but some stock will have problems that were unforeseen. It happens. It is not necessarily a time to sell these companies, but you have to look at their ability to survive and not be irreparable damaged by the recession.
In a bear market also, some companies will keep their dividends flat and yet others will raise theirs. It generally depends what sector they are in. To survive a bear market, you might want to reframe it into an adventure in investing. It can go from scary to exciting.
On my other blog I wrote yesterday about Goeasy Ltd (TSX-GSY, OTC-EHMEF) ... learn more. Next, I will write about Lassonde Industries (TSX-LAS.A, OTC-LSDAF) ... learn more on Wednesday, June 12, 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.
Thursday, June 6, 2019
Something to Buy June 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 June 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), Leon's Furniture (TSX-LNF, OTC-LEFUF), Magna International Inc. (TSX-MG, NYSE-MGA), and Stingray Digital Group Inc (TSX-RAY.A). High Liner Foods (TSX-HLF, OTC-HLNFF) has bee removed from the list and Magna International Inc. (TSX-MG, NYSE-MGA) has been added.
Eleven (or 50%) 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), Goeasy Ltd (TSX-GSY, OTC-EHMEF), 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), Richelieu Hardware Ltd. (TSX-RCH, OTC-RHUHF) and Stingray Digital Group Inc (TSX-RAY.A). There is no change from last month.
I now follow 10 Consumer Staples stocks. AGT Food and Ingredients Inc (TSX-AGT, OTC-AGXXF) is being taken private effective April 17, 2019. No companies are showing as cheap by the historically high dividend yield. There is no change from last month.
Two stocks (or 20%) are showing cheap by historical median dividend yield. These are, Loblaw Companies (TSX-L, OTC-LBLCF), Metro Inc. (TSX-MRU, OTC-MTRAF). AGT Food and Ingredients Inc. (TSX-AGT, OTC-AGXXF), Empire Company Ltd (TSX-EMP.A, OTC-EMLAF), and Lassonde Industries (TSX- LAS.A, OTC-LSDAF) have been removed from the list.
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 HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF), Johnson and Johnson (NYSE-JNJ), and Medtronic Inc. (NYSE-MDT). There is no change from last month.
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), and Ensign Energy Services (TSX-ESI, OTC-ESVIF), and Suncor Energy (TSX-SU, NYSE-SU). Canadian Natural Resources (TSX-CNQ, NYSE-CNQ) has added back to this list. Mullen Group (TSX-MTL, OTC-MLLGF) has been removed from this list.
There are six stocks (or 60%) 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), Husky Energy (TSX-HSE, OTC-HUSKF), Mullen Group (TSX-MTL, OTC-MLLGF) and Suncor Energy (TSX-SU, NYSE-SU). Husky Energy (TSX-HSE, OTC-HUSKF) has been added to 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.
Six stocks (or 75%) are showing cheap by historical median dividend yield. They are Bank of Nova Scotia (TSX-BNS, NYSE-BNS), Barclays PLC (LSE-BARC, NYSE-BCS), 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). Royal Bank (TSX-RY, NYSE-RY) has been added back to this list.
I follow 15 Financial Service stocks. One stock is showing as cheap by the historically high dividend yield and that is Power Corp (TSX-POW, OTC-PWCDF). Power Corp (TSX-POW, OTC-PWCDF) has been added to this list.
Ten (or 67%) 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), 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). There is no change from last month.
I follow 6 Insurance stocks. None are showing as cheap by the historically high dividend yield. 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 showing as cheap by the historically high dividend yield. There is no change from last month.
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). Bird Construction Inc (TSX-BDT, OTC-BIRDF), and SNC-Lavalin (TSX-SNC, OTC-SNCAF) have been added to this list.
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). PFB Corp (TSX-PFB, OTC-PFBOF) has been added to this list.
I follow 16 Services stocks. One stock is showing as cheap by the historically high dividend yield and that is Transcontinental Inc (TSX-TCL.A, OTC-TCLAF). Transcontinental Inc (TSX-TCL.A, OTC-TCLAF has been added to this list.
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 9 Material stocks. None are showing as cheap by the historically high dividend yield. This has not changed from last month.
Six stock or 67% 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), Methanex Corp (TSX-MX, NASDAQ-MEOH), Stella-Jones (TSX-SJ, OTC-STLJF), and Supremex Inc (TSX-SXP, OTC-SUMXF). There is no change from last month.
I follow 10 Real Estate stocks. No stock is showing as cheap by historically high dividend yield. There is no change from last month. Two stocks (or 20%) are showing cheap by historical median dividend yield. They are Granite Real Estate (TSX-GRT.UN, NYSE-GRP.U) and Melcor Developments Inc. (TSX-MRD, OTC-MODVF). There is no change from last month.
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. None are showing as cheap by historical high dividend yield. Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR) has been removed from this list.
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 Sylogist Ltd (TSXV-SYZ, OTC-SYZLF). There is no change from last month.
I follow 6 of the Infrastructure type utility companies. Note that TransCanada Corp (TSX-TRP, NYSE-TRP is now TC Energy Corp (TSX-TRP, NYSE-TRP. None are showing as cheap by historical high dividend yield. This has not changed from last month.
Three stocks (or 50%) are showing cheap by historical median dividend yield. They are), Enbridge Inc. (TSX-ENB, NYSE-ENB), Keyera Corp (TSX-KEY, OTC-KEYUF) and TC Energy Corp (TSX-TRP, NYSE-TRP). There is no change from last month.
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.
Three stocks (or 27%) 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 Just Energy Group Inc. (TSX-JE, NYSE-JE). There is not change from last month.
On my other blog I wrote yesterday about Maxar Technologies Ltd (TSX-MAXR, NYSE-MAXR) ... learn more. Next, I will write about Husky Energy Inc. (TSX-HSE, OTC-HUSKF) ... learn more on Friday, June 7, 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.
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 June 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), Leon's Furniture (TSX-LNF, OTC-LEFUF), Magna International Inc. (TSX-MG, NYSE-MGA), and Stingray Digital Group Inc (TSX-RAY.A). High Liner Foods (TSX-HLF, OTC-HLNFF) has bee removed from the list and Magna International Inc. (TSX-MG, NYSE-MGA) has been added.
Eleven (or 50%) 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), Goeasy Ltd (TSX-GSY, OTC-EHMEF), 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), Richelieu Hardware Ltd. (TSX-RCH, OTC-RHUHF) and Stingray Digital Group Inc (TSX-RAY.A). There is no change from last month.
I now follow 10 Consumer Staples stocks. AGT Food and Ingredients Inc (TSX-AGT, OTC-AGXXF) is being taken private effective April 17, 2019. No companies are showing as cheap by the historically high dividend yield. There is no change from last month.
Two stocks (or 20%) are showing cheap by historical median dividend yield. These are, Loblaw Companies (TSX-L, OTC-LBLCF), Metro Inc. (TSX-MRU, OTC-MTRAF). AGT Food and Ingredients Inc. (TSX-AGT, OTC-AGXXF), Empire Company Ltd (TSX-EMP.A, OTC-EMLAF), and Lassonde Industries (TSX- LAS.A, OTC-LSDAF) have been removed from the list.
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 HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF), Johnson and Johnson (NYSE-JNJ), and Medtronic Inc. (NYSE-MDT). There is no change from last month.
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), and Ensign Energy Services (TSX-ESI, OTC-ESVIF), and Suncor Energy (TSX-SU, NYSE-SU). Canadian Natural Resources (TSX-CNQ, NYSE-CNQ) has added back to this list. Mullen Group (TSX-MTL, OTC-MLLGF) has been removed from this list.
There are six stocks (or 60%) 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), Husky Energy (TSX-HSE, OTC-HUSKF), Mullen Group (TSX-MTL, OTC-MLLGF) and Suncor Energy (TSX-SU, NYSE-SU). Husky Energy (TSX-HSE, OTC-HUSKF) has been added to 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.
Six stocks (or 75%) are showing cheap by historical median dividend yield. They are Bank of Nova Scotia (TSX-BNS, NYSE-BNS), Barclays PLC (LSE-BARC, NYSE-BCS), 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). Royal Bank (TSX-RY, NYSE-RY) has been added back to this list.
I follow 15 Financial Service stocks. One stock is showing as cheap by the historically high dividend yield and that is Power Corp (TSX-POW, OTC-PWCDF). Power Corp (TSX-POW, OTC-PWCDF) has been added to this list.
Ten (or 67%) 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), 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). There is no change from last month.
I follow 6 Insurance stocks. None are showing as cheap by the historically high dividend yield. 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 showing as cheap by the historically high dividend yield. There is no change from last month.
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). Bird Construction Inc (TSX-BDT, OTC-BIRDF), and SNC-Lavalin (TSX-SNC, OTC-SNCAF) have been added to this list.
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). PFB Corp (TSX-PFB, OTC-PFBOF) has been added to this list.
I follow 16 Services stocks. One stock is showing as cheap by the historically high dividend yield and that is Transcontinental Inc (TSX-TCL.A, OTC-TCLAF). Transcontinental Inc (TSX-TCL.A, OTC-TCLAF has been added to this list.
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 9 Material stocks. None are showing as cheap by the historically high dividend yield. This has not changed from last month.
Six stock or 67% 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), Methanex Corp (TSX-MX, NASDAQ-MEOH), Stella-Jones (TSX-SJ, OTC-STLJF), and Supremex Inc (TSX-SXP, OTC-SUMXF). There is no change from last month.
I follow 10 Real Estate stocks. No stock is showing as cheap by historically high dividend yield. There is no change from last month. Two stocks (or 20%) are showing cheap by historical median dividend yield. They are Granite Real Estate (TSX-GRT.UN, NYSE-GRP.U) and Melcor Developments Inc. (TSX-MRD, OTC-MODVF). There is no change from last month.
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. None are showing as cheap by historical high dividend yield. Maxar Technologies Ltd (TSX-MAXR-NYSE-MAXR) has been removed from this list.
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 Sylogist Ltd (TSXV-SYZ, OTC-SYZLF). There is no change from last month.
I follow 6 of the Infrastructure type utility companies. Note that TransCanada Corp (TSX-TRP, NYSE-TRP is now TC Energy Corp (TSX-TRP, NYSE-TRP. None are showing as cheap by historical high dividend yield. This has not changed from last month.
Three stocks (or 50%) are showing cheap by historical median dividend yield. They are), Enbridge Inc. (TSX-ENB, NYSE-ENB), Keyera Corp (TSX-KEY, OTC-KEYUF) and TC Energy Corp (TSX-TRP, NYSE-TRP). There is no change from last month.
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.
Three stocks (or 27%) 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 Just Energy Group Inc. (TSX-JE, NYSE-JE). There is not change from last month.
On my other blog I wrote yesterday about Maxar Technologies Ltd (TSX-MAXR, NYSE-MAXR) ... learn more. Next, I will write about Husky Energy Inc. (TSX-HSE, OTC-HUSKF) ... learn more on Friday, June 7, 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.
Tuesday, June 4, 2019
Dividend Stocks June 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 June 2019.
On this list,
Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN)
Bank of Montreal (TSX-BMO, NYSE-BMO)
Canadian Pacific Railway (TSX-CP, NYSE-CP)
Equitable Group Inc (TSX-EQB, OTC-EQGPF)
Finning International Inc. (TSX-FTT, OTC-FINGF)
Industrial Alliance Ins. and Fin. (TSX-IAG, OTC-IDLLF)
National Bank of Canada (TSX-NA, OTC-NTIOF)
Onex Corp (TSX-ONEX, OTC-ONEXF)
Pembina Pipeline Corp (TSX-PPL, NYSE-PBA)
PFB Corp (TSX-PFB, OTC-PFBOF)
Power Corp (TSX-POW, OTC-P-CDF)
Sun Life Financial (TSX-SLF, NYSE-SLF)
Telus Corp (TSX-T, NYSE-TU)
TransCanada Corp has changed its name to TC Energy Corp. The symbols have remained the same so it is now TC Energy Corp (TSX-TRP, NYSE-TRP). This is effective May 3, 2019. AGT Food and Ingredients Inc (TSX-AGT, OTC-AGXXF) is being taken private effective April 17, 2019.
Of the stocks I follow, 2 stocks have cut their dividends.
High Liner Foods (TSX-HLF, OTC-HLNFF)
Lassonde Industries (TSX-LAS.A, OTC-LSDAF)
Of the stocks I follow, no stock has suspended or terminated their dividends. There is a tension between needing money for investing in growth and paying dividends.
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 Ensign Energy Services (TSX-ESI, OTC-ESVIF) ... learn more. Next, I will write about Maxar Technologies Ltd (TSX-MAXR, NYSE-MAXR) ... learn more on Wednesday, June 05, 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.
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 June 2019.
On this list,
- I have 11 stocks with a dividend yield higher than the historical high dividend yield,
- I have 50 stocks with a dividend yield higher than the historical average dividend yield
- I have 79 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.
- I have 09 stocks with a dividend yield higher than the historical high dividend yield,
- I have 53 stocks with a dividend yield higher than the historical average dividend yield
- I have 73 stocks with a dividend yield higher than the historical median dividend yield and
- 83 stocks with a dividend yield higher than the 5 year average dividend yield.
- 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.
Algonquin Power & Utilities Corp (TSX-AQN, NTSE-AQN)
Bank of Montreal (TSX-BMO, NYSE-BMO)
Canadian Pacific Railway (TSX-CP, NYSE-CP)
Equitable Group Inc (TSX-EQB, OTC-EQGPF)
Finning International Inc. (TSX-FTT, OTC-FINGF)
Industrial Alliance Ins. and Fin. (TSX-IAG, OTC-IDLLF)
National Bank of Canada (TSX-NA, OTC-NTIOF)
Onex Corp (TSX-ONEX, OTC-ONEXF)
Pembina Pipeline Corp (TSX-PPL, NYSE-PBA)
PFB Corp (TSX-PFB, OTC-PFBOF)
Power Corp (TSX-POW, OTC-P-CDF)
Sun Life Financial (TSX-SLF, NYSE-SLF)
Telus Corp (TSX-T, NYSE-TU)
TransCanada Corp has changed its name to TC Energy Corp. The symbols have remained the same so it is now TC Energy Corp (TSX-TRP, NYSE-TRP). This is effective May 3, 2019. AGT Food and Ingredients Inc (TSX-AGT, OTC-AGXXF) is being taken private effective April 17, 2019.
Of the stocks I follow, 2 stocks have cut their dividends.
High Liner Foods (TSX-HLF, OTC-HLNFF)
Lassonde Industries (TSX-LAS.A, OTC-LSDAF)
Of the stocks I follow, no stock has suspended or terminated their dividends. There is a tension between needing money for investing in growth and paying dividends.
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 Ensign Energy Services (TSX-ESI, OTC-ESVIF) ... learn more. Next, I will write about Maxar Technologies Ltd (TSX-MAXR, NYSE-MAXR) ... learn more on Wednesday, June 05, 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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