Top Canadian Dividend Stocks
After reading Derek Fosters book, my interest in researching strong Canadian dividend paying stocks has increased. I already own quite a few dividend payers in my portfolio, but I thought I would share with you some of the stronger dividend paying stocks around Canada.
One great source of strong dividend companies is Mergent’s Canadian Dividend & Income Achievers List. The Claymore Dividend & Income Achievers ETF (CDZ) replicates the Mergent list. Here is an excerpt from the Claymore site that describes CDZ:
The Claymore CDN Dividend & Income Achievers ETF has been designed to replicate the performance of the Mergent’s Canadian Dividend & Income Achievers Index. Mergent’s Canadian Dividend & Income Achievers Index consists of some of the issuers in Mergent’s Canadian Dividend Achievers (70%) and a group of Income Trusts and real estate investment trust (REITs) (30%). The weighting methodology is modified yield weighted.
Since 1979, Mergent has identified, on a yearly basis, companies with a stream of dividend payment increases, the “Dividend Achievers.” The index seeks to identify and select a diversified group of dividend and distribution paying companies which have consistently increased their annual dividends and payments to shareholders. The index represents a diversified portfolio of leading high yield equity securities in Canada weighted based on yield and quality and selected by Mergent using a rules-based methodology including consistent growth of dividend and distribution payments.
I always find it helpful to take a look at ETF lists to get some stock ideas. If you are not comfortable buying individual stocks, why not buy the ETF itself and own ALL of the strong Canadian dividend paying stocks for a management fee (0.60%)?
Personally, I’m not completely comfortable with income trusts as most of them pay out more in dividends than they earn. Even if they increase their dividends every year, I’m still cautious over them.
If you’re too busy to check out the iShares site for yourself, here is a list of their top holdings (Feb 2014):
|Exchange Income Corp||EIF|
|Enbridge Income Fund||ENF|
|Northern Property REIT||NPR.U|
|Canadian Real Estate Investment Trust||REF.U|
|Genworth MI Canada||MIC|
|Bank of Nova Scotia||BNS|
|Toronto Dominion Bank||TD|
|Major Drilling Group||MDI|
|Ensign Energy Services||ESI|
|Computer Modelling Group||CMG|
There are quite a few dividend payers in Canada, but the ones listed above have increased their payouts at least once / year for the past 10 years 5 years (thanks Edwin). What I regularly do is keep a watching the dividend payers for dips in their stock price. If you take a look at the list above, it is apparent that a lot of banks seem to currently have lower yields historically speaking.
Interested in doing a little technical analysis on dividend stocks that you are interested in? Here’s the free trend analysis tool that I use. Simply enter the stock symbol and they will email you a printed report.
Stay tuned for tomorrows article with a list of strong American dividend paying stocks.
More Canadian Dividend Stocks Investing Info:
- How to buy dividend stocks
- When to buy dividend stocks
- How to create a stock watchlist
- Top Canadian stock screeners
Disclaimer: I own some of the stocks listed in this article. The stocks listed in this article are not stock recommendations, buy at your own risk.