Over the past few years, a group of bloggers have enlisted in a friendly competition as to who can pick the best stocks for the year. As per tradition, we all report quarterly results to see how we are doing relative to each other, and more importantly, the market. This year, I picked a financial stock (BNS.TO), a big US consumer stock (MMM), a large Canadian minerals company (TCK-B.TO), and a well known Canadian oil company (SU.TO).
Up to the end of Q2, the portfolio returned 1.73% including dividends – not bad relative to the 0% return of the TSX. How did Q3 turn out? Lets take a look!
Bank of Nova Scotia (BNS.TO) – With Canadian banks retreating from their highs in late 2011, their dividend yields have reached an attractive range. Scotia Bank, with a current yield of approximately 4%, is known for their international operations and I believe has some upside coming in 2012. That is providing that we don’t have a global financial meltdown. :) Trading price as of closing Dec 30, 2011: $50.83. Disclaimer: I own shares of BNS.TO.
Even though the first half of the year was volatile, at the end of Q2, BNS returned 5.92% including dividends. With things turning brighter, stocks generally moved up in Q3. Trading price as of September 30, 2012: $53.92. Combined with a $1.67 dividend equates to a return of 9.36% after Q3 2012. Disclaimer: I own shares of BNS.TO.
3M Co. (MMM) – This company is a great example of a Dividend Achiever where it has increased their dividend for 53 consecutive years with a current yield of 2.69% and P/E ratio of 13.74. Who is 3M? They are a large diversified technology company with seven large divisions. However, they are likely most well known as the inventor of the Post-It note. 3M shares sold off in late 2011 but it looks like the stock has already started its recovery. Trading price as of closing Dec 30, 2011: $81.73. Disclaimer: I own shares of MMM.
I picked this one to get exposure to the US market and that it appeared oversold at the beginning of the year. This one has been a winner as the US market remains strong, especially for top US dividend stocks. Trading price as of September 30, 2012: $92.42. Combined with a $1.77 dividend equates to a return of 15.25% after Q3 2012. Disclaimer: I own shares of MMM.
Teck Resources (TCK.B.TO) – Teck Resources is my mineral play where the company is engaged in the exploration, development and production of copper, coal, gold and zinc. It faced a steep decline in 2011 and I believe will start climbing again once confidence in the economy thus commodities returns. Teck currently yields 2.23% with a P/E ratio of 8.92. Trading price as of closing Dec 30, 2011: $35.91. Disclaimer: I own shares of TCK.B.
The most volatile stock in the portfolio has continued to drag down the others. Trading price as of September 30, 2012: $29.01 combined with a $0.40 dividend equates to a return of -18.1% after Q3 2012. Disclaimer: I own shares of TCK-B.TO.
Suncor Energy (SU.TO) – Suncor Energy is Canada’s largest integrated energy company. It has a large stake in the oil sands and is involved in numerous other energy plays across the country. While this is not a huge dividend stock with a yield of 1.50%, I believe that the energy sector is oversold and has a large upside should the buyers return. Trading price as of closing Dec 30, 2011: $29.38.Disclaimer: I own shares of SU.TO.
Canadian oil stocks picked up a bit in Q3 which helped prop up Suncor’s gain by about 10%. Trading price as of September 30, 2012: $32.34. Combined with a $0.37 dividend equates to a return of 11.33% after Q3 2012. Disclaimer: I own shares of SU.TO.
While the portfolio beat the TSX in Q2, it has become a laggard in Q3. Overall, the portfolio has returned 4.46% year to date, with the TSX returning approximately 6% including dividends (via XIU.TO). The SP500 has been on a tear through three quarters returning 15% including dividends (via XSP.TO).
Net worth update coming up on Wednesday!
Here are the the picks and results from the other bloggers: