Blue Chips for November 2021

Dan Kent talks about his blue chip stocks for November 2021 on Stock Trades. The stocks are listed below. However, read his article to find out why he picks these stocks.

Stocks are:

• Fortis (TSX-FTS)
• Royal Bank of Canada (TSX-RY)
• Canadian National Railway (TSX-CNR)
• Constellation Software (TSX-CSU)
• Metro (TSX-MRU).
• BCE Inc (TSX-BCE)
• Canadian Apartment Properties (CAP) REIT (TSX-CAR.UN)
• Canadian Pacific Railway (TSX-CP)
• TC Energy (TSX-TRP)
• Brookfield Asset Management (TSE-BAM.A)
• Barrick Gold (TSE-ABX)

I have all of these stocks except for Constellation Software (TSX-CSU), Canadian Apartment Properties (CAP) REIT (TSX-CAR.UN), Canadian Pacific Railway (TSX-CP) and Brookfield Asset Management (TSE-BAM.A). I do follow CP and BAM.

On my other blog I wrote yesterday about Quarterhill Inc (TSX-QTRH, OTC-QTRHF) ... learn more. Next, I will write about Chesswood Group Ltd (TSX-CHW, OTC-CHWWF) ... learn more on Friday, November 19, 2021 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.

Getting Schooled in Risk

Druce Vertes on Enterprising Investor has an interesting article called Getting Schooled in Risk: The Lessons of Poker.

However, I am the sort of investor that did good in the market slowly and simply. I do find this article interesting. When my son was young, I learned enough about card playing to show my son how to play cards. When he consistently beat mean, I just quit. I was not much interested in playing cards, but I figured all kids should learn how.

On my other blog I wrote yesterday about Finning International Inc (TSX-FTT, OTC-FINGF) ... learn more. Next, I will write about Quarterhill Inc (TSX-QTRH, OTC-QTRHF) ... learn more on Wednesday, November 17, 2021 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.

Couch Potato Investing

Couch Potato Investing article from Money Sense and sponsored by BMO. This is all about index-based Mutual Funds and ETFs (Exchange Traded Funds). ETFs and just index-based mutual funds sold as stocks. However, I you are interested in this sort of investing, this is an article on this subject.

Personally, I prefer to buy good stocks and hold them for the long term. I especially like companies that buy dividends and increase their dividends over time. We do have a lot of good Canadian companies to hold for the long term in Financials, Consumer, Utility, Tech, and Industrials sectors. I personally do not go in much for any resources (that is Oil and Gas and Mining) as they are too cyclical.

On my other blog I wrote yesterday about Innergex Renewable Energy (TSX-INE, OTC-INGXF) ... learn more. Next, I will write about Crescent Point Energy Corp (TSX-CPG, NYSE-CPG) ... learn more on Friday, November 12, 2021 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 are Dividends

Dan Kent on Stock Trades does a good job of explaining dividends.

The sort of stock I like to buy are what are called Dividend Growth Stocks. These are companies that grow their dividends over time. They do not have to increase their dividends every year, but they must grow. The companies I like can grow their dividends because of growing revenue and earnings.

On my other blog I wrote yesterday about PFB Corp (TSX-PFB, OTC-PFBOF) ... learn more. Next, I will write about Innergex Renewable Energy (TSX-INE, OTC-INGXF) ... learn more on Wednesday, November10, 2021 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 November 2021

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 dividend yield test in this note is a quick way of finding possible stock buys. See my Spreadsheet .

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. However, this is just a place to start. It is a good idea to check the stock price with other tests, especially the P/S Ratio test. For other testing, like P/E Ratios, P/S Ratios, P/CF Ratios, P/BV Ratios and Price/Graham Price Ratios, you use estimates or data from the last reported financial quarter.

If a stock is showing as a buy using the dividend yield test, I usually like to verify it is a buy by doing a P/S Ratio test. Here you compare the current P/S Ratio to the 10 year median P/S Ratio. If the current P/S Ratio is lower than the 10 year median, then the stock is a buy. I note that Morningstar gives a current P/S Ratio. The 10 year median ratio is shown in my review of a stock. The 10 year median ratio in a review is good for one year from the date of review.

This historical dividend yield test 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 10 year median dividend yield.

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

Categorizing stocks is not as simple as it might seem. Every site you go to has categorized stocks a bit differently. I try to keep this as simple as possible. See Something to Buy November 2021 Spreadsheet above 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 follow 22 stocks in the Consumer Discretionary category. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Six (23%) of Consumer Discretionary are showing cheap by historical median dividend yield. They are Canadian Tire Corp (TSX-CTC.A, OTC-CDNAF), Goodfellow Inc (TSX-GDL, OTC-GFELF), Leon's Furniture (TSX-LNF, OTC-LEFUF), Magna International Inc. (TSX-MG, NYSE-MGA), Molson Coors Canada (TSX-TPX.B, NYSE-TAP) and Stingray Digital Group Inc (TSX-RAY.A). There is no change from last month.

I follow 10 Consumer Staples stocks. No stocks are showing as cheap by the historically high dividend yield. There is no change from last month.

Six stocks (60%) are showing cheap by historical median dividend yield. These are Alimentation Couche-Tard (TSX-ATD.B, OTC-ANCUF), Empire Company Ltd (TSX-EMP.A, OTC-EMLAF), Lassonde Industries (TSX-LAS.A, OTC-LSDAF), 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 follow Five Health Care stocks. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Three stocks (60%) are cheap by the historical median dividend yield. The stocks are Johnson and Johnson (NYSE-JNJ), Medtronic Inc. (NYSE-MDT), and Sienna Senior Living Inc (TSX-SIA, OTC-LWSCF). HLS Therapeutics Inc (TSX-HLS, OTC-HLTRF) has been removed from this list.

I follow 9 Energy stocks. One stock (11%) is showing as cheap by the historical high dividend yield. It is Suncor Energy (TSX-SU, NYSE-SU). Suncor Energy (TSX-SU, NYSE-SU) has been added.

There are Two stocks (22%) showing as cheap by historical median dividend yield. They are Canadian Natural Resources (TSX-CNQ, NYSE-CNQ), and Suncor Energy (TSX-SU, NYSE-SU). There is no change from last month.

I follow 26 Financial stocks under the categories of Banks, Financial Services, and Insurance.

I follow 8 Bank stocks. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Two stocks (25%) are showing as cheap by historical median dividend yield. They are Bank of Nova Scotia (TSX-BNS, NYSE-BNS), and Toronto Dominion Bank (TSX-TD, NYSE-TD). There is no change from last month.

I follow 13 Financial Service stocks. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Three stocks (23%) are showing as cheap by the historical median dividend yield. These stocks are AGF Management Ltd (TSX-AGF.B, OTC-AGFMF), IGM Financial (TSX-IGM, OTC-IGIFF), and Power Corp (TSX-POW, OTC-PWCDF). Alaris Equity Partners Income Trust (TSX-AD.UN, OTC-ALARF) has been removed from this list.

I follow 5 Insurance stocks. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Three stocks (60%) are showing as cheap by historical median dividend yield. These stocks are Great-West Lifeco Inc. (TSX-GWO, OTC-GWLIF), IA Financial Corp (TSX-IAG, OTC-IDLLF), and Manulife Financial Corp (TSX-MFC, NYSE-MFC). There is no change from last month.

I follow 33 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 am now following Titanium Transportation Group Inc (TSX-TTR, OTC-TTTGF) which has been added to my services group.

I have 7 Construction stocks. No stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Two stock (29%) are showing as cheap by historical median dividend yield. They are Aecon Group Inc (TSX-ARE, OTC-AEGXF), and Badger Infrastructure Solutions Ltd (TSX-BDGI, OTC-BADFF). There is no change from last month.

I have 3 stocks I have left with the sub-index of Industrial. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

One stock (33%) is showing as cheap by historical median dividend yield. It is Finning International Inc. (TSX-FTT, OTC-FINGF). There is no change from last month.

I have 7 Manufacturing stocks. None of these stocks (0%) are showing as cheap by the historically high dividend yield. There is no change from last month.

Two stocks (29%) are showing as cheap by historical median dividend yield. They are Exco Technologies Ltd. (TSX-XTC, OTC-EXCOF) and Hammond Power Solutions Inc (TSX-HPS.A, OTC-HMDPF). There is no change from last month.

I follow 16 Services stocks. One of these stocks (6.25%) is showing as cheap by the historically high dividend yield. It is Titanium Transportation Group Inc (TSX-TTR, OTC-TTTGF). I am now following Titanium Transportation Group Inc (TSX-TTR, OTC-TTTGF) which has been added to my services group.

Two stock (13%) are showing as cheap by historical median dividend yield. They are Transcontinental Inc (TSX-TCL.A, OTC-TCLAF) and Titanium Transportation Group Inc (TSX-TTR, OTC-TTTGF). Titanium Transportation Group Inc (TSX-TTR, OTC-TTTGF) has been added to this list. Canadian National Railway (TSX-CNR, NYSE-CNI) has been removed from this list.

I follow 10 Material stocks. One stock (10%) is showing as cheap by the historically high dividend yield. It is Kirkland Lake Gold (TSX-KL, NYSE-KL). There is no change from last month.

Three stock (30%) are showing as cheap by historical median dividend yield. The stocks are Barrick Gold Corp (TSX-ABX, NYSE-ABX), Kirkland Lake Gold (TSX-KL, NYSE-KL), and Stella-Jones (TSX-SJ, OTC-STLJF). There is no change from last month.

I follow 10 Real Estate stocks. No stocks (0%) are showing as cheap by historically high dividend yield. There is no change from last month.

Two stocks (20%) are showing as cheap by historical median dividend yield. They are Melcor Developments Inc. (TSX-MRD, OTC-MODVF), and SmartCentres REIT (TSX-SRU.UN, OTC-CWYUF). There is no change from last month.

I follow 3 of the Telecom Service stocks. None of the stocks (0%) are showing as cheap by historically high dividend yield. There is no change from last month.

Three stocks (100%) are showing cheap by historical median dividend yield. These stocks are BCE (TSX-BCE, NYSE-BCE), Shaw Communications Inc (TSX-SJR.B, NYSE-SJR) and Telus Corp (TSX-T, NYSE-TU). There is no change from last month.

I follow 10 Tech stocks. No stocks (0%) are showing as cheap by historical high dividend yield. There is no change from last month.

Three stock (33%) are showing cheap by historical median dividend yield. They are 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 8 of the Infrastructure Type utility companies. None of the stocks (0%) are showing as cheap by historical high dividend yield. There is no change from last month.

Three stocks (38%) 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 9 of the Power Type utility companies. One stock (10%) is showing as cheap by historical high dividend yield. It is ATCO Ltd (TSX-ACO.X, OTC-ACLLF). There is no change from last month.

Three stocks (33%) are showing as cheap by historical median dividend yield. Those stocks are ATCO Ltd (TSX-ACO.X, OTC-ACLLF), Canadian Utilities Ltd (TSX-CU, OTC-CDUAF) and Fortis Inc (TSX-FTS, OTC-FRTSF). Fortis Inc (TSX-FTS, OTC-FRTSF) has been added to this list.

On my other blog I wrote yesterday about Johnson and Johnson (NYSE-JNJ) ... learn more. Next, I will write about IBI Group Inc (TSX-IBG, OTC-IBIBF) ... learn more on Friday, November 05, 2021 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 November 2021

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. You might want to get the free weekly newsletter from Canadian Stock Channel which says what might be the best Canadian Dividend Stocks to buy at the present time.

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. Some use the 10 year average or median yield rather than the historical ones. I use median yields, always. See my spreadsheet at dividend growth stocks that I just updated for November 2021.

On this list,

• I have 4 stocks with a dividend yield higher than the historical high dividend yield,
• I have 32 stocks with a dividend yield higher than the historical average dividend yield
• I have 49 stocks with a dividend yield higher than the historical median dividend yield and
• 44 stocks with a dividend yield higher than the 10 year median dividend yield.

When I did my list last list in October 2021,

• I have 2 stocks with a dividend yield higher than the historical high dividend yield,
• I have 33 stocks with a dividend yield higher than the historical average dividend yield
• I have 50 stocks with a dividend yield higher than the historical median dividend yield and
• 44 stocks with a dividend yield higher than the 10 year median 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 median dividend yield.

If you had one share of each stock, total dividends last month would be $173.69. This month dividends would be $174.04. It can vary as because some stocks are paid in US$ and so this figure is affected by currency exchange. Of the stock that I follow 5 stocks has raised their dividends since last month.

Emera Inc (TSX-EMA, OTC-EMRAF)
Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF)
PFB Corp (TSX-PFB, OTC-PFBOF)
Suncor Energy Inc (TSX-SU, NYSE-SU)
Waste Connections Inc (TSX-WCN, NYSE-WCN)

Of the stocks I follow, 0 stock have cut their dividends.

Of the stocks I follow, 0 stocks have suspended or terminated their dividend.

Equitable Group Inc (TSX-EQB, OTC-EQGPF) has done a two for one split in October 2021. See the news item.

Dorel Industries (TSX-DII.B, OTC-DIIBF) stock price has basically doubled since last month. The only thing I can find is that they sold their Dorel Sports division to Pon Holdings. See the news item. Another news item in October is about Dorel Industries Inc. entering into an extensive equipment investment at three of its North American factories as well as the purchase of Notio Living. See this news item.

Keg Royalties Income Fund (TSX-KEG.UN, OTC-KRIUF) has announced that dividends are being returned to pre-pandemic levels. See the news item. Suncor Energy Inc (TSX-SU, NYSE-SU) has also said that they will increase their dividend to pre 2019 level. See the news item. This is a very positive development.

PFB Corp (TSX-PFB, OTC-PFBOF) has announced that they will not only increase their dividend, but will pay a special dividend in November 2021. See the news item.

Of the stocks I follow, the following declined the most in their stock price.

Name	Exch	Sym	Exch	Sym	Chge SP
K-Bro Linen Inc	TSX	KBL	OTC	KBRLF	-10.34%
Alimentation Couche-	TSX	ATD.B	OTC	ANCUF	-10.16%
Bombardier Inc.	TSX	BBD.B	OTC	BDRBF	-9.95%
Quarterhaill Inc	TSX	QTRH	OTC	QTRHF	-9.93%
Maxar Technologies Ltd	TSX	MAXR	NYSE	MAXR	-9.90%
Methanex Corp	TSX	MX	NASDAQ	MEOH	-9.49%
Molson Coors Canada	TSX	TPX.B	NYSE	TAP	-8.00%
BRP Inc	TSX	DOO	NASDAQ	DOOO	-7.90%
Saputo Inc	TSX	SAP	OTC	SAPIF	-7.80%
Stingray Digital Group	TSX	RAY.A	OTC	None	-6.83%

Of the stock that I follow, these stocks gained the most in their stock price.

Name	Exch	Sym	Exch	Sym	Chge SP
Keg Royalties Income	TSX	KEG.UN	OTC	KRIUF	16.20%
Cenovus Energy Inc	TSX	CVE	NYSE	CVE	16.26%
Finning International Inc	TSX	FTT	OTC	FINGF	16.47%
Goodfellow Inc	TSX	GDL	OTC	GFELF	18.90%
WildBrain Ltd	TSX	WILD	OTC	WLDBF	20.00%
Suncor Energy Inc	TSX	SU	NYSE	SU	22.97%
Just Energy Group Inc	TSX	JE	NYSE	JE	25.96%
Ballard Power Systems	TSX	BLDP	NASDAQ	BLDP	26.37%
Reitmans (Canada) Ltd	TSX	RET.A	OTC	RTMAF	33.75%
Dorel Industries	TSX	DII.B	OTC	DIIBF	101.26%

Most of my stocks started out as Dividend Payers. Currently 17 stocks are not paying any dividends and this would be some 10.97% of the stocks that I follow. Three of these stocks never had dividends, so 9.03% 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 10 year median dividend yields (P/10Y). 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 today about Cenovus Energy Inc (TSX-CVE, NYSE-CVE) ... learn more. Next, I will write about Johnson and Johnson (NYSE-JNJ) ... learn more on Wednesday, November 03, 2021 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.

Dividend Safety

Dylan Callaghan on Stock Trades, Canada talks about dividend safety. He covers a lot of good points and is well worth the read for people who invest in dividend stocks. It illustrates his points with Enbridge.

I personally check dividend payments in a number of ways. I look at Dividend Payout Ratios (DPR) for Earnings per Share (EPS), Cash Flow per Share (CFPS) and Free Cash Flow. I look at DPRs for the last financial year, for 5 year coverage and possible future. Personally, my favourite is generally the CFPS adjusted for WC.

I do DPR for EPS for the last financial year and also for the past 5 years. You cannot judge a dividend payment ratio against one year as EPS sometimes can be unrepresentative of what the company is really making with checking only one year. EPS might be too high or too low in one year to be representative of the earnings of a company. I also look at the DPR for what analysts suggest is both the future dividends and EPS.

When I DPR for CFPS, I am looking at the Cash Flow from Operations and Cash Flow from Operations adjusted for Working Capital (WC). I do calculate the Working Capital, but I also look at what TD WebBroker says is the WC. For all but financial stocks, this calculation gives you a good idea on if dividends being paid are reasonable. I also look at the 5 year coverage ratios.

I do the DPR for FCF. I do calculate the FCF, and I look at what Morningstar, WebBroker reports and Wall Street Journal (WSJ) says. The problem with FCF is that a lot of the time, the different sources do not agree on what the FCF is. I look at DPR for FCF for the last financial year and for 5 year coverage. I also look at what analysts think the FCF will be in the future in comparison with future dividends.

On my other blog I wrote yesterday about Titanium Transportation Group Inc (TSX-TRR, OTC-PVVTF) ... learn more. Next, I will write about Keyera Corp (TSX-KEY, OTC-KEYUF) ... learn more on Friday, October 29, 2021 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.