Stocks and Golf Podcast
David Winchell at Stocks and Golf, asked me back for another radio show chat! Be sure to check out Stocks and Golf Podcast No. 047, with my interview at seven minutes into the segment. David is an easy going guy who makes anyone feel comfortable. I always enjoy having the chance to talk with him.
David asked me of course if I had any stocks on my watch list. So I was happy to share a sector I have been currently watching – the Canadian mining sector. I also discussed why I prefer a dividend investing strategy, and why investors need to be cautious in a rising market.
Rogers Sugar Special Dividend
Rogers Sugar (RSI) paid a special dividend of 0.36 cents per share, to shareholders on Feb. 28th. They had 64.7 million dollars of free cash flow, accumulated since 2007, and decided to distribute this as a special dividend. This was a nice dividend treat that added another $79.20 into my portfolio. I was able to add another 12 shares to Rogers through my DRIP. Rogers Sugar is a very small position in my portfolio, in part because of its small capitalization at 604 million, and higher yield at 5.6% (which used to be much higher). However it does have a small economic moat, since it’s the predominant sugar refiner and supplier here in Western Canada. It’s literally on all the store shelves!
Canadian Banks Raise Dividends (Again)
Canada’s banks have again reported stellar profits and earnings, even amidst fears of sluggish growth, an apparent housing bubble, and high debt load among Canadians. A recent Globe and Mail article, Canada’s banks awash in profits, cites the Royal Bank with a $2.07 billion dollar profit and TD with a $1.79 billion dollar profit. But the Canadian banks are also solid dividend growth companies.
The Royal bank increased its dividend 5% from .60 to 0.63 cents per share. TD followed suite, also raising its dividend by 5% from 0.81 to 0.84 cents per share. The Bank of Montreal also boosted its dividend by 2.7% from 0.72 to 0.74 cents per share. My other bank holding, BNS, reports next week and will likely raise its dividend as well. Of the banks that have reported, only CIBC and National did not boost their dividends. As a long-term owner in three of the Canadian banks, BMO, BNS, and RY, the profitable earnings and dividend increases is good news!
The Weekly Lineup
There were some other great posts around the web this week. Be sure to check them out!
On The Dividend Pig, I wrote a detailed post about Opportunity in the Canadian Mining Sector. I looked at three companies on my watch list, which I may pull the trigger on over the next few months. Many dividend investors have largely ignored this sector because of the lower yields, yet these are actually dividend growth companies, with potential for more capital growth.
Dividend Growth Investor wrote an interesting post this week, where he looks at the S&P Dividend Aristocrats Index, and explains why it’s an incomplete list.
Since I was looking at the Canadian mining stocks, here was an interesting article in the Globe and Mail on Barrick Gold. It’s the classic value play or value trap dilemma. Although Barrick has a higher yield than Goldcorp, the higher yield comes with a few problems. These are higher debt, negative earnings, and a $7.3 billion dollar write-off for Equinox Minerals in Zambia. However like most large companies, Barrick will likely be able to turn things around.
The Passive Income Earner provided a detailed and thorough analysis of Davis + Henderson Corp. Davis Henderson is another one of those high yield Canadian stocks that used to be an income trust. It’s also the company that causes many Canadians grief, with high cheque printing fees. They have a monopoly on the cheque printing business here in Canada.
The Dividend Mantra created a buzz last week when he hit the buy button on the Canadian Banks! His initial post was very interesting, and he did some thorough research. Be sure to read his two recent posts, Three Canadian Stocks On My Watchlist and Recent Buy. These posts are a must read! And special mention to Dividend Mantra who is now a blink away from 100K!
Have a nice weekend everyone!