Dividend Income – May 2012

This month, I have an addition to my dividend portfolio. After taking some profits from Liquor Store (TSE:LIQ) in my TFSA account, I decided to purchase Canadian National Railway – a solid transportation company across North America. From a business point of view, the company isn’t going anywhere anytime soon as trains are still very economical in distributing our goods across the country. I did a comparison of CNR and CP if you are curious about the players and why I chose CNR over CP.

The addition of CNR will actually reduce my dividend income in the short term but I expect stronger results in the future as Canadian National Railway is a true dividend growth stock for the 10-10 rule.

Dividend Income

As you can see from the graph, there is a pattern in my dividends with a couple of good months followed by a lower month. May happens to be a good month with $512.73. I am on track to earn $6,000 this year but $7,000 may be stretching it. It’s my goal but even if I can save, I only have a couple of quarters to grow my dividends by an extra $1,000. That’s a tall order.

I am currently following a number of U.S. companies as I anticipate being able to add some money to my RRSP over the summer and take some positions in some dividend aristocrats conglomerates. MSFT just started trading a little below $30 these days too. I am a believer in holding a larger position U.S. companies in my RRSP whereas I have none in my TFSA since there is no beneficial treatment for foreign dividend income.

I continue to slowly add to my Computershare and Can Stock holdings. Every now and again I send a $50, $100 or even $300 cheque to increase my position. I have a simple where I add to the holdings that are behind. I hold BMO and BNS on both sides mostly because I wanted to transfer shares to my kids. At 10 and 12 years old, my children are investors :)

DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.

DISCLAIMER: Please note that this blog post represents my opinion and not an advice/recommendation. I am not a financial adviser, I am not qualified to give financial advice. Before you buy any stocks/funds consult with a qualified financial planner. Make your investment decisions at your own risk – see my full disclaimer for more details.
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