Category Archives: Canadian Dividend Watch List

Canadian Dividend Watch List: January 15, 2013

Posted on January 16, 2013 by | Comments Off on Canadian Dividend Watch List: January 15, 2013

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Continue reading →

Comments Off on Canadian Dividend Watch List: January 15, 2013

Posted in Canadian Dividend Watch List

Canadian Dividend Watch List: December 21, 2012

Posted on December 21, 2012 by | Comments Off on Canadian Dividend Watch List: December 21, 2012

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Yield P/B % from low
EMA.TO Emera Inc. 34.22 18.92 1.81 4.10% 2.87 6.83%
FTS.TO Fortis Inc. 33.93 20.09 1.66 3.70% 1.64 7.10%
FFH.TO FAIRFAX FINANCIAL HOLDINGS LTD. 359.24 - - 2.80% ∞ 7.24%
IMO.TO Imperial Oil Ltd. 43.09 9.88 4.34 1.10% 2.33 8.32%
TRI.TO Thomson Reuters Corporation 28.77 - -1.07 4.40% 1.41 8.76%
EMP-A.TO Empire Company Limited 59.17 10.76 5.5 1.60% 1.12 10.70%

Watch List Summary

What happened to all of the companies on the watch list this month?  Simply put, there were fewer companies within 10% of their 52-week low compared to the November 15, 2012 watch list (found here).  So, what happened to the companies from the November 15th list?  The table below tells the story:

symbol
 Name 15-Nov 21-Dec % change
CCO.TO Cameco Corp. 16.73 20.03 19.73%
AGF-B.TO AGF Management Limited 9.13 9.75 6.79%
TIH.TO Toromont Industries Ltd. 19.19 21.34 11.20%
IGM.TO IGM Financial Inc. 38.98 42.43 8.85%
GS.TO Gluskin Sheff + Associates, Inc. 13.95 14.84 6.38%
CNQ.TO Canadian Natural Resources 27.58 28.86 4.64%
PWF.TO Power Financial Corporation 25.56 27.39 7.16%
FTT.TO Finning International Inc. 22.13 24.46 10.53%
CCA.TO Cogeco Cable Inc. 37.58 39.13 4.12%
CTC-A.TO Canadian Tire Corp. Ltd. 66.39 70.02 5.47%
CU.TO Canadian Utilities Ltd. 64.61 70.9 9.74%
ESI.TO Ensign Energy Services Inc. 14.13 15.13 7.08%
TRP.TO TransCanada Corp. 44.25 47.35 7.01%
  Average change since Nov. 15th     8.36%

The last month has been excellent for a majority of the companies that were on the November 15th Watch List.   Of the companies that were on the watch list, the top half of the list gained an average of +9.60% with Cameco Corp. leading the way.  The bottom half of the list gained an average of +7.30% with Cogeco Cable lagging behind all of the stocks.  On the average, all of the stocks not on the list this month gained, as a group, +8.36%.

We prefer to concentrate our holdings at 10% of the portfolio and above.  Afterwards, we like to take gains of +10% or more.  Obviously, we would have missed the +9.73% gains that CCO.TO achieved after hitting the +10% gain mark.  However, we’re very comfortable with consistent small gains that are above average annual market returns (approximately +11% annually for the last 50 years) and letting the profits run while reallocating the rest of the capital to other investment opportunities.

Comments Off on Canadian Dividend Watch List: December 21, 2012

Posted in Canadian Dividend Watch List, EMA.TO, FFH.TO, FTS.TO, IMO, TRI.TO

Canadian Dividend Watch List: November 15, 2012

Posted on November 15, 2012 by | Leave a comment

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive annual dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

symbol Name Price P/E EPS Yield P/B % from low
CCO.TO Cameco Corp. 16.73 13.6 1.23 2.40% 1.34 1.09%
AGF-B.TO AGF Management Limited 9.13 14.27 0.73 11.60% 0.78 1.22%
TIH.TO Toromont Industries Ltd. 19.19 13.42 1.42 2.40% 3.4 3.12%
EMP-A.TO Empire Company Limited 55.24 10.46 5.28 1.70% 1.11 3.35%
FTS.TO Fortis Inc. 32.78 19.4 1.66 3.60% 1.59 4.66%
TRI.TO Thomson Reuters Corporation 27.39 0 -1.07 4.70% 1.33 4.94%
FFH.TO FAIRFAX FINANCIAL HOLDINGS LTD. 354.22 0 0 2.70% 0 5.74%
IGM.TO IGM Financial Inc. 38.98 11.81 3.08 5.50% 2.31 5.90%
GS.TO Gluskin Sheff + Associates, Inc. 13.95 23.25 0.61 5.00% 5.55 5.92%
CNQ.TO Canadian Natural Resources Limited 27.58 10.65 2.16 1.50% 1.27 7.82%
PWF.TO Power Financial Corporation 25.56 10.48 2.43 5.40% 1.55 8.21%
EMA.TO Emera Inc. 33.7 18.93 1.78 4.10% 2.72 8.64%
FTT.TO Finning International Inc. 22.13 12.57 1.76 2.50% 2.69 8.85%
CCA.TO Cogeco Cable Inc. 37.58 8.13 4.59 1.70% 1.57 9.09%
CTC-A.TO Canadian Tire Corp. Ltd. 66.39 10.76 6.14 2.10% 1.19 9.48%
CU.TO Canadian Utilities Ltd. 64.61 15.38 4.19 2.70% 2.63 9.51%
ESI.TO Ensign Energy Services Inc. 14.13 9.74 1.45 3.10% 1.2 9.62%
TRP.TO TransCanada Corp. 44.25 22.69 1.94 4.00% 1.98 9.77%

Analyst Low Earnings Estimate for 2013

symbol Name 2013 low EPS est. # of analysts est. 2013 price est. 2013 % change
GS.TO Gluskin Sheff + Associates, Inc. $0.76 9 $17.67 26.94%
FTT.TO Finning International Inc. $2.03 12 $25.52 14.58%
TRP.TO TransCanada Corp. $2.19 10 $49.69 12.22%
FTS.TO Fortis Inc. $1.75 7 $33.95 4.24%
CU.TO Canadian Utilities Ltd. $4.16 4 $63.98 1.00%
EMA.TO Emera Inc. $1.77 6 $33.51 -0.28%
PWF.TO Power Financial Corporation $2.21 7 $23.16 -9.42%
IGM.TO IGM Financial Inc. $2.91 9 $34.37 -11.81%
TIH.TO Toromont Industries Ltd. $1.26 8 $16.91 -12.16%
CCA.TO Cogeco Cable Inc. $4.03 6 $32.76 -12.72%
ESI.TO Ensign Energy Services Inc. $1.12 10 $10.91 -22.02%
CCO.TO Cameco Corp. $0.96 12 $13.06 -22.05%
CNQ.TO Canadian Natural Resources  $1.86 10 $19.81 -27.63%

Watch List Summary

As can be seen above, only five companies on our watch list are slated to have higher earnings in the coming year, under the assumption that the stocks retain the same P/E ratio that they currently have right now.  An alternative view is that if the earnings expectation improve, these same companies could potentially match or exceed expectations.  This could mean that the stocks slated to decline in price might have the most potential to increase in value.

Leave a comment

Posted in Analyst Estimate, Canadian Dividend Watch List

Tagged

Canadian Dividend Watch List: October 26, 2012

Posted on October 27, 2012 by | Leave a comment

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive annual dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Yield P/B % from low
FFH.TO FAIRFAX FINANCIAL HOLDINGS LTD. 361.98 0 0 2.80% 0 1.55%
AGF-B.TO AGF Management Limited 10.14 15.84 0.73 10.70% 0.84 2.11%
IGM.TO IGM Financial Inc. 38.73 11.74 3.3 5.60% 2.27 5.22%
TIH.TO Toromont Industries Ltd. 19.49 13.82 1.39 2.50% 3.52 5.98%
CCA.TO Cogeco Cable Inc. 36.69 7.19 5.06 2.70% 1.53 6.50%
FTS.TO Fortis Inc. 33.4 18.98 1.73 3.60% 1.61 6.64%
EMP-A.TO Empire Company Limited 57.4 10.87 5.28 1.70% 1.11 7.39%
TRI.TO Thomson Reuters Corporation 28.29 0 -1.17 4.50% 1.39 8.39%
PWF.TO Power Financial Corporation 25.65 10.51 2.43 5.50% 1.53 8.59%
CCO.TO Cameco Corp. 18.89 16.87 1.12 2.10% 1.49 9.51%
GS.TO Gluskin Sheff + Associates, Inc. 14.45 24.08 0.6 4.50% 5.52 9.72%

Watch List Summary

The financials do not favor Fairfax Financial Holdings, the top stock on our watch list.  The fundamental situation indicates that there are no earnings which makes the dividend that much more precarious.  On the technical side, a decline below CAN$360 could mean that the next downside target is CAN$330-CAN$277.  In the best case scenario, the upside opportunity for FFH.TO is 22% to the high of CAN$442.  Anyone wishing to venture into this stock should accept the high level of risk for a company run by a person considered to be the “Warren Buffett of Canada.”

From a technical standpoint, AGF Management seems to be on course to retest the 2009 low of CAN$6.74, a decline of –33%.  Already AGF has declined over –50% from the high set in late May of 2011.  Although we suspect that AGF Management will decline to the prior low, funds dedicated to this stock should be done in three stages.  Once at the current level after appropriate due diligence, and again at the 2009 low.  The third portion should be allotted for any additional decline below the 2009 low.

Leave a comment

Posted in Canadian Dividend Watch List

Tagged

Canadian Dividend Watch List: September 21, 2012

Posted on September 22, 2012 by | Leave a comment

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS P/B % from low Downside risk*
FFH.TO Fairfax Financial Holdings 359.99 35.54 - - 0.99% -28.01%
FTS.TO Fortis Inc. 33.05 18.78 1.73 1.6 5.52% -15.10%
IGM.TO IGM Financial Inc. 39.05 11.83 3.3 2.29 6.09% -33.42%
SJR-B.TO Shaw Communications, Inc. 20.1 13.4 1.52 2.61 6.18% -12.94%
RBA.TO Ritchie Bros. Auctioneers Incorporated 19.02 24.7 0.77 3.12 6.61% -36.91%
CCA.TO Cogeco Cable Inc. 37.25 7.3 5.06 1.55 8.13% -28.46%
TCL-A.TO Transcontinental Inc. 8.66 - -1.77 0.7 8.66% -7.97%
PWF.TO Power Financial Corporation 25.75 10.55 2.43 1.58 9.02% -8.27%
GS.TO Gluskin Sheff + Associates, Inc. 14.42 10.6 0.6 5.58 9.49% -58.32%
IFC.TO Intact Financial Corporation 58.59 15.71 3.82 1.95 9.78% -20.91%
  1. stocks are in Canadian dollars.
  2. *based on Dow Theory 50% Principle

Watch List Summary

This month’s list has one important feature that is an added benefit for those wondering about our take on the downside risk for these stocks.  We’ve added a downside risk column to suggest what an investor might reasonably be able to expect for the listed companies in the coming year.  Our estimate for the downside risk is based on the Dow Theory 50% Principle.

The Dow Theory 50% Principle is based on the midpoint between the low, after a significant decline in price, and the most recent peak in the price.  According to Charles H. Dow, the 50% Principle, also known as the law of action and reaction, works in the following fashion:

“The market is always responsive to the great law of action and reaction. The longer the swing one way the longer it will be the other. One of the best general rules in speculation is the theory that the reaction in an advance or a decline will be at least one-half of the primary movement.” (Dow, Charles H. “Review & Outlook.” Wall Street Journal. October 19, 1900.)

In the chart below, we have circled the low and high for Fairfax Financial (FFH.TO).  The mid-point between the high and the low is $259.15 or –28.01% below the current trading price.

image

We believe that the downside targets are a necessary consideration before the purchase of any stock. This become even more of an issue when we believe that the stock market appears to be topping and Dow Theory currently indicates that we are in a bear market.

For good measure we have applied the 50% Principle for the Toronto Stock Exchange Composite Index.  Our expectation is that if the TSX manages to stay above 10,922.12 then the market will go back to the 2012 high.  However, if the TSX cannot stay above the mid-point, then we expect it to decline to the 9,747 level.  Anything below the 9,747 level will result in a decline to the 2009 low.

image

Leave a comment

Posted in Canadian Dividend Watch List

Tagged

Canadian Dividend Watch List: August 17, 2012

Posted on August 18, 2012 by | Comments Off on Canadian Dividend Watch List: August 17, 2012

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Yield Price/Book % from low
IGM.TO IGM Financial Inc. 37.25 11.3 3.3 0.40% 2.19 1.20%
FFH.TO FAIRFAX FINANCIAL HOLDINGS LTD. 379.97 0 0 2.70% 1.07 3.59%
GS.TO Gluskin Sheff + Associates, Inc. 13.89 8.37 1.27 4.50% 5.26 5.47%
SJR-B.TO Shaw Communications, Inc. 20.01 19.33 1.52 4.90% 2.58 5.71%
SNC.TO SNC-Lavalin Group Inc. 37.41 14.06 1.98 1.60% 2.89 7.13%
PWF.TO Power Financial Corporation 25.31 11.37 2.42 5.60% 1.53 7.15%
AGF-B.TO AGF Management Limited 11.56 8.9 1.02 9.40% 0.94 7.24%
RBA.TO Ritchie Bros. Auctioneers Incorporated 19.25 32.08 0.77 2.60% 3.19 7.54%
CCA.TO Cogeco Cable Inc. 37.08 7.3281 5.06 2.70% 1.55 7.63%
EMP-A.TO Empire Company Limited 58.21 10.64 4.99 1.70% 1.16 8.91%

Watch List Summary

Of particular interest on this Canadian Watch List is Ritchie Bros. Auctioneers (RBA).  The very first time that this company appeared on our list was August 23, 2010 when the stock was trading at $18.94.  Immediately after showing up on our list, RBA vaulted to $29.66 or +56% by April 29, 2011.

image

After attaining the $29.66 level, Ritchie Bros. declined –36% back to the $18.85 level.  RBA then rose nearly +37% by late February 2012 before returning to the current level of $19.25.  The consistency of RBA to rise from the $18/$19 level in the last 6 years has got to end somewhere.  The stock market is very quick to take away anything that appears too easy.  Therefore, we need to find a reasonable margin for error if we were to enter into such a transaction.

According to Yahoo!Finance, Ritchie Bros. is “…an industrial auctioneer, sells various equipment to on-site and online bidders. The company, through unreserved public auctions, sells a range of used and unused industrial assets, including equipment, trucks, and other assets utilized in the construction, transportation, agricultural, material handling, mining, forestry, petroleum, and marine industries.”

We normally don’t rely on “stories” behind a stock because such analysis typically leads to false hope and unrealistic expectations.  However, here is what we think the “story” on RBA might be.  As secular bear markets tend to coincide with a commodity bull market, there will be a high demand for the very equipment that RBA auctions.  As many companies try and fail to enter into the capital intensive mining and farming sector, RBA will be quick to step in and auction the equipment that will be in high demand.  The more auctions, while there is exceptional demand for the equipment, the better the earnings for RBA.

image

According to Edson Gould’s Altimeter, Ritchie Bros. hit an extreme low in 2009.  Through all of the gyrations in the market since, RBA’s Altimeter is now trading at the equivalent level as the 2009 low.

In terms of the downside risk on RBA, we believe that a critical support level is at $17.84.  According to Dow Theory, if RBA were to fall significantly below this level then the next downside targets would be (indicates percentage decline from current price of $19.25):

  • $15.81 (-17.87%)
  • $13.78 (-28.42%)
  • $11.75 (-38.96%)

From a Dow Theory standpoint, RBA is dancing along that fine line of $17.84 and has successfully done so for the last 6 years.  This suggests that the stock has either pent up value or is going to get crushed to the downside.  Cautious as we might be under normal circumstances, we believe that RBA is worth considering at the current price with another planned purchase if the stock declines to the $13.78 level.

Comments Off on Canadian Dividend Watch List: August 17, 2012

Posted in Canadian Dividend Watch List, GS, RBA, Ritchie Bros.

Canadian Dividend Watch List: July 25, 2012

Posted on July 25, 2012 by | Leave a comment

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Yield Price/Book % from low
IAG.TO Industrial Alliance Insurance and Financial Services 20.74 18.52 1.13 4.60% 0.81 0.92%
PWF.TO Power Financial Corporation 24.2 9.49 2.53 5.80% 1.47 2.46%
IGM.TO IGM Financial Inc. 39.28 11.39 3.45 5.60% 2.26 2.91%
SJR-B.TO Shaw Communications, Inc. 19.58 13.05 1.52 5.00% 2.5 3.43%
TCL-A.TO Transcontinental Inc. 9.42 0 -1.48 6.20% 0.74 3.86%
CCA.TO Cogeco Cable Inc. 35.99 7.06 5.05 2.80% 1.64 4.47%
FFH.TO Fairfax Financial Holdings 376.57 33.21 0 2.70% 0 4.60%
EMP-A.TO Empire Company Limited 55.97 11.22 4.99 1.70% 1.13 4.71%
AGF-B.TO AGF Management Limited 11.29 11.88 1.02 9.60% 0.91 4.73%
GS.TO Gluskin Sheff + Associates, Inc. 13.9 10.22 1.27 4.70% 5.38 5.54%
POW.TO Power Corporation of Canada 22.21 9.1 2.42 5.20% 1.12 6.27%
BNS.TO The Bank Of Nova Scotia 50.61 11.25 4.51 4.30% 1.91 6.46%
CWB.TO Canadian Western Bank 25.78 11.36 2.19 2.50% 1.74 7.42%
CNQ.TO Canadian Natural Resources Limited 27.5 9.96 2.75 1.50% 1.3 7.51%
TRI.TO Thomson Reuters Corporation 28.34 0 -1.61 4.60% 1.42 8.58%
GWO.TO Great-West Lifeco Inc. 20.84 9.6 2.15 5.90% 1.64 8.83%

Watch List Summary

On our list this week is Industrial Alliance Insurance and Financial Services, Inc. (IAG.TO).  Yahoo!Finance indicates that IAG is a provider of  “…life and health insurance company, engages in the provision of various insurance products, savings and retirement plans, and other financial products and services in the United States and Canada.”

According to Dow Theory, IAG has the following downside targets:

  • $20.04
  • $16.90
  • $13.75

We also ran Edson Gould’s Altimeter on IAG and found that the dividend of the last few years distorted the indicator.  To adequately adjust for the distortions, we provided IAG with an annual dividend increase of $0.0157 from February 2000 to the present annual dividend of $0.98.  Using this adjustment provided us with the following downside targets:

  • $17.15
  • $12.25
  • $7.35

image

Our view is that $16.90 and below are appropriate levels to start acquiring IAG.  Even at the current price, the dividend of 4.60% allows for a slight downside cushion provided it is understood that the stock must be held for 1 year.

Leave a comment

Posted in Canadian Dividend Watch List

Tagged

Canadian Dividend Watch List: May 25, 2012

Posted on May 26, 2012 by | Leave a comment

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases. For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Price/Book % Chg Low Go to FP
AGF-B.TO AGF Management Limited $11.65 8.97 1.13 0.95 0.95% →
SJR-B.TO Shaw Communications, Inc. $19.52 18.86 1.44 2.59 2.90% →
IGM.TO IGM Financial Inc. $40.10 12.17 3.45 2.35 3.59% →
IAG.TO Indu'l Alliance Insur. and Finan'l Services $25.83 8.58 1.13 0.97 4.36% →
TCL-A.TO Transcontinental Inc. $9.76 6.9 0.23 0.67 4.50% →
EMP-A.TO Empire Co. Ltd. $56.00 10.24 4.39 1.15 6.54% →
BNS.TO The Bank Of Nova Scotia $50.95 11.19 4.74 2.02 7.17% →
CCA.TO Cogeco Cable Inc. $45.88 - 0.24 1.95 8.00% →
PWF.TO Power Financial Corporation $25.66 11.53 2.53 1.57 8.64% →
HCG.TO Home Capital Group Inc. $43.03 7.63 5.74 1.8 8.83% →
CWB.TO Canadian Western Bank $26.18 12.64 2.16 1.81 9.08% →

Watch List Summary

AGF Management (AGF.B): (According to the Financial Post, “AGF Management Limited is a wealth management corporation whose principal subsidiaries provide mutual fund management and distribution, trust products and services, investment advisory services and third-party fund administration services for clients.”

AGF is skating on thin ice with a dividend payout ratio of 94%.  This means that if the company were to experience any decline in earnings (likely) then there is the prospect of the company cutting the dividend.  Currently, AGF has a dividend yield of 9.30% which suggests that a dividend cut isn’t too far away if things don’t improve soon.

Currently, $11.13 is the point that will either make or break the stock price. If AGF.B cannot stay above $11.13 then there is a good chance that the stock will revisit the prior low of $6.46, a decline of –42%.  According to Dow Theory, AGF has the following downside targets:

  • $11.13
  • $9.58
  • $8.03
  • $6.46

image

Industrial Alliance Insurance and Financial Services (IAG.TO):  According to Yahoo!Finance, IAG.TO is “a life and health insurance company, [which] engages in the provision of various insurance products, savings and retirement plans, and other financial products and services in the United States and Canada.”

IAG.TO has a dividend yield of 3.80% and a payout ratio of 89%.  Again, with such a narrow margin of safety, in terms of the dividend payout ratio, investors should not be surprised if a dividend cut were to take place.   According to Dow Theory, IAG.TO has the following downside targets:

  • $32.55
  • $23.20
  • $13.85

With IAG.TO trading at $25.83, the $23.20 price is a critical support level for the stock.  This stock would be considered for purchase by us when, and if, it reaches the $18.50 level.  According to Dow Theory, IAG.TO has a fair value of $27.87.

Watch List Performance Review

In our ongoing review of the NLO Canadian Dividend Watch List, we have taken the top five stocks from our May 13, 2011 list (found here) and have checked their performance, approximately one year later, as compared to the S&P/TSX Composite index. The top five companies from that list can be seen in the table below.

Symbol
 Name 2011 2012 % change
TRI Thomson Reuters 37.78 28.51 -24.54%
RCI.B Rogers Comm. 35.82 35.5 -0.89%
SJR.B Shaw Comm. 20 19.11 -4.45%
EMP.A Empire Co. Ltd. 54.45 57.83 6.21%
CJR.B Corus Ent. Inc. 20.44 23.64 15.66%
      Average: -1.60%
         
S&P/TSX Toronto Stock Exchange     -15.32%

image

While our watch list was in the negative at the end of the year, it did well compared to the Toronto Stock Exchange over the same period.  In fact, 4 of the five stocks on our list were able to achieve our goal of gains of +10% in less than 6 months.

Leave a comment

Posted in Canadian Dividend Watch List

Tagged

Canadian Dividend Watch List: April 2, 2012

Posted on April 2, 2012 by | 3 comments

This is a list of Canadian dividend stocks that currently, or in the past, had a history of consecutive dividend increases.  For those wishing to find the most complete fundamental information on these companies, we recommend visiting one of Canada’s leading financial websites, the Financial Post (found here). However, Yahoo!Finance probably has the better long-term charts and historical dividend data.

Symbol Name Price P/E EPS Price/Book % from Low
GS.TO Gluskin Sheff + Associates, Inc. $14.77 8.98 1.34 5.49 5.50%
EMP-A.TO Empire Co. Ltd. $58.06 10.53 4.39 1.18 11.18%
SNC.TO SNC-Lavalin Group Inc. $40.75 15.01 2.49 3.2 11.46%
TRI.TO Thomson Reuters Corporation $29.13 17.27 -1.68 1.47 11.61%
SJR-B.TO Shaw Communications, Inc. $21.39 20.4 1.44 2.86 11.99%
AGF-B.TO AGF Management Limited $15.63 11.92 1.13 1.22 12.28%
TLM.TO Talisman Energy Inc. $12.90 - 0.38 1.29 13.76%
IGM.TO IGM Financial Inc. $46.71 14.09 3.48 2.76 13.79%
FTS.TO Fortis Inc. $32.48 18.23 1.74 1.57 15.01%
RCI-B.TO Rogers Communications Inc. $40.06 13.95 2.86 5.76 16.96%
TRP TransCanada Corp. $43.63 19.79 2.17 1.88 17.00%
BNS.TO The Bank Of Nova Scotia $56.15 12.27 4.74 2.22 18.11%
  1. stocks are in Canadian dollars except TRP, which is calculated in U.S. dollars.

Watch List Summary

This watch summary will review Edson Gould’s Altimeter when applied to Gluskin Sheff (GS.TO) and SNC-Lavalin (SNC.TO).  First up is the Altimeter for Gluskin Sheff (GS.TO).  According to Yahoo!Finance, Gluskin Sheff “is a publicly owned investment manager. The firm also provides wealth management services.”

Based on the current quarterly dividend of $0.163, GS.TO is bouncing along the undervalued range of $14.11.  Because the middle of the undervalued/overvalued range is $19.42 (fair value), we’re expecting that the next upside target is to the fair valued level or +31% above the closing price of $14.77.

image

As always, we’re primarily concerned with the worst case scenario.  For GS.TO, the downside target is based on the December 2008 low at $6.71.  Any substantial decline below the $14.11 level should result in GS.TO falling to $10.41.  If GS.TO were to fall as low as $6.71 it would be in alignment with our rule of preparing for a decline of -50% or more and allocating our capital accordingly.

Our next stock is SNC-Lavalin (SNC.TO).  According to Yahoo!Finance, SNC.TO “provides engineering and construction, and operations and maintenance services worldwide.”  Edson Gould’s Altimeter, as applied to SNC-Lavalin Group (SNC.TO) presents a pattern that is quite unique.  Again, Edson Gould’s Altimeter compares the current stock price as it relates to the quarterly dividend that is currently being paid.  SNC.TO has a descending Altimeter with the normal undervalued range at $43.60.  The next upside target for SNC.TO is at $55, however, we’re waiting for resolution on the potential downside action.

image

Our worst case scenario is that SNC.TO will continues on the declining trend and reach our downside target of $30.80.  In our assumption, the worst case downside target continues to slide as time passes until proven otherwise.  Again, while there are major upside targets at $55 and $69, we’d rather wait for the final verdict on retracing back above $43.60 or falling to $30.80.

Watch List Top 5 Performance Review

In our ongoing review of the NLO Canadian Dividend Watch List, we have taken the top five stocks from our April 13, 2011 list and have checked their performance, approximately one year later, as compared to the S&P/TSX Composite index.  The top five companies from that list can be seen in the table below.

Symbol Name 4/13/2011 4/2/2012 % change
Rogers Comm. CL. B 34.32 40.06 16.72%
SJR-B.TO Shaw Comm. CL.B 19.64 21.39 8.91%
EMP-A.TO Empire Co. CL.A 53.67 58.06 8.18%
TRI.TO ThomsonReuters 39.1 29.13 -25.50%
POW.TO Power Corp 27.9 26.75 -4.12%
Average change 0.84%
GSPTSE S&P/TSX Composite 13,833.64 12,507.06 -9.59%

Among the top five companies on our watch list from last year, three of the five companies exceeded the return of the Toronto Stock Exchange index.  Power Corp. declined less than the index while ThomsonReuters fell by more than -25%.  Taken as a group, the average return was +0.84% as compared to the –9.59% for the representative index.

3 Comments

Posted in Canadian Dividend Watch List