Top 10 Canadian Dividend Stocks – April 2019

Top 10 Canadian Dividend StocksWhile we know that the stock market will grow over time, on a day-to-day or even month-to-month basis, the stock market is always changing value due to the daily fluctuation of all the stocks.

The opportunities will vary every month and that’s why it’s important to have a systematic approach to understanding which dividend stocks are an opportunity. An opportunity can be for a stock you already own or simply for a new addition to your portfolio. It is important to note that the rankings below do not assess the viability of the business. Some of the companies are strong blue chip stocks while others are smaller companies with growth or just simply beaten down.

Top 10 Canadian Dividend Stocks

Here are the top 10 Canadian dividend stocks for this month, see below for the details. This is obviously a snapshot in time at the time of writing, many factors could change the rankings.

Here is a quick excerpt on the top 10 dividend growth stocks opportunities identified through the Canadian Dividend Performance List.

Stay on top of your next investment decision with the Dividend Snapshot Canadian Dividend Performance List. Review the Chowder Rule along with the 3, 5, and 10 year ratios for dividend growth, EPS growth and the payout ratio to pick a solid investment for your portfolio.

The monthly top 10 rarely have the same top 10 stocks. Be sure to come back, or better yet, follow the top 10 with the Canadian Dividend Performance List.

Get your list of STRONG Dividend Growth Stocks

Suncor

SU - Suncor EnergySuncor Energy is one of the largest independent energy companies in the world engaging in oil sands operations, offshore oil and gas production, petroleum refining and marketing. It is the largest oil producer in Canada. The company has operations across the entire value chain, including resource extraction, upgrading, refining and marketing, and midstream logistics. In addition, Suncor is involved in energy trading and operates a renewable energy business. Suncor owns offshore assets in key strategic geographic locations like the U.K. North Sea, Canada’s east coast and Norway. The company operates four refineries, an ethanol plant, wind farms, and over 1700 retail sites in North America and owns 940 mbpd oil production, 550 mbpd upgrading, and 460 mbpd refining capacities. Suncor’s long-life, low-decline reserve base with a proven life of more than 30 years, sets it apart from peers.

Investment Data

Methanex Corp

MX - Methanex CorpMethanex is the largest producer and supplier of methanol in the world. The company operates through a huge network of 6 production facilities (with an annual production capacity of 9.4 million tonnes), 11 global offices, and 17 distribution terminals and storage facilities. It also owns the world's largest fleet of methanol ocean tankers, barge, rail, truck and pipeline. Methanex has access to low cost natural gas feedstock and enters into long-term natural gas contracts which grant it enough cash flow visibility. The company has an extensive international reach and serves large, global chemical and China MTO companies. Its low cost structure and large scale of operations are huge competitive advantages. Methanex benefits from being the only supplier of methanol with a well-established global market presence and production base.

Investment Data

Laurentian Bank

LB - Laurentian BankLaurentian Bank is a leading Canadian bank, providing a broad range of advice-based solutions and services to its clients through its branch network based in Quebec and specialized teams across Canada.

Laurentian Bank caters to the needs of retail clients, small and medium-sized enterprises and real estate developers. It has pan-Canadian activities and an expanding presence in the U.S. The bank is a leading player in different market segments like retail, business, financial services, securities and capital markets. With more than 170 years of banking experience, Laurentian Bank is trusted for its quality services, prudent management and good governance. The bank is incurring huge expenditure to focus more on a customer friendly approach. It is expecting improved technology and better processes should drive customer, loan and deposit growth in future.

Investment Data

Keyera Corp

KEY - Keyera CorpKeyera Corp. is one of the largest independent midstream energy companies with extensive interconnected assets across Canada. The company caters to the needs of oil and gas producers in the Western Canada Sedimentary Basin, and provides NGL gathering and processing, fractionation, storage, transportation, logistics and marketing services. Keyera’s core infrastructure is strategically located in key producing areas of Western Canada Sedimentary basin and Edmonton/ Fort Saskatchewan energy hub. The company also markets iso-octane, propane, butane, condensate and crude oil to customers in Canada and the United States. It operates through Gathering and Processing, Liquids Infrastructure and Marketing segments. Keyera has strong expertise in operating complex energy processing facilities and provides a full range of essential midstream services to its customers.

Investment Data

Finning International

Finning International is the world's largest Caterpillar dealer. The company deals in selling, renting and providing parts and service for equipment and engines since the last 85 years. The company operates in three geographies - Canada (52% of revenue), UK & Ireland (16%) and South America (32%). It operates a large network of product support services across British Columbia, Yukon, Alberta, Saskatchewan, the Northwest Territories, and a portion of Nunavut. Finning caters to a wide range of customers in diversified industries such as mining, construction, petroleum, forestry and power systems. By revenues, product support is the largest accounting for 54% of total revenues, followed by new equipment (37%), used equipment (5%) and rental (4%). Superior technology and a large portfolio of autonomous solutions are Finning Internationals’ strong competitive strengths. Favorable market conditions in construction and oil and gas will act as a tailwind for the company.

Investment Data

CIBC

CIBC or Canadian Imperial Bank of Commerce is a leading North American financial institution, formed as a result of the merger between the Canadian Bank of Commerce and the Imperial Bank of Canada in 1961. The bank operates through its four strategic business units Canadian Personal and Small Business Banking (48% of latest net income), Canadian Commercial Banking and Wealth Management (24%), U.S. Commercial Banking and Wealth Management (13%), and Capital Markets (15%). The bank caters to 11 million individual, small business, commercial, corporate and institutional clients in Canada, the U.S. and around the world. CIBC has a strong client focused culture and operational efficiencies which drive shareholder value and aid growth across different platforms. CIBC’s investment in technology and digital platforms should also meet the evolving needs of its clients. The bank caters to 11 million individual, small business, commercial, corporate and institutional clients in Canada, the U.S. and around the world.

Investment Data

Transcontinental Inc

TCL.A - Transcontinental IncTranscontinental is a leader in flexible packaging in North America. It is Canada’s largest printer and a leader in specialty media segments. The company provides innovative solutions in both printing and packaging segments. It specializes in flexographic printing, lamination of plastic films, and offers print solutions for flyers, newspapers, magazines, and mass marketing products. With over four decades of experience, the company has developed deep expertise in manufacturing and distribution of print and digital content. Transcontinental has operations in Canada, the United States and Latin America. The company completed the acquisition of Coveris Americas in 2018, which further strengthened its market share in the flexible packaging sector. As a result, Transcontinental is expecting its consolidated revenues to comprise 45% of printing revenues, 52% of packaging revenues and 3% of media revenues going forward.

Investment Data
  • Opportunity Score: 80%
  • Ticker: TSE:TCL.A
  • Sector: Consumer Cyclical
  • Industry: Publishing
  • Market Cap: 1.45B
  • P/E: 7.52
  • Dividend Yield: 5.30%
  • Dividend Payout Ratio: 39.82%

Aecon Group Inc

For more than a century, Aecon and our predecessor companies have helped to build many of Canada's most famous landmarks – from the CN Tower and St. Lawrence Seaway, to the Vancouver Sky Train and Halifax Shipyards. In addition to these great landmarks, we've also helped to build hundreds of factories, roads, sewers, theatres, book stores, power plants, arts centres, mine sites, offices, hotels and gas distribution networks – the smaller, but no less important projects that help to make Canada a great place to live.

Investment Data

Lassonde Industries

LAS.A - Lassonde Industries IncLassonde Industries is a leader in the production and sale of food and beverages in North America. The company deals in specialty food products, fruit and vegetable juices and wines. It is also a major producer of cranberry sauces. Founded in 1918, Lassonde is a leading name in the agri-food industry. It is one of the top two producers of store brand, shelf-stable fruit juices and drinks in the US and operates through 15 plants across Canada and the United States. Almost 40% of Lassonde’s sales is in Canada and 60% is from the US. Retail sales account for approximately 86% of total annual sales while food service sales account for the remaining 14%. The company operates through four specialized subsidiaries and more than 25 well-known brands in Canada and the US. Some of its prominent brands include names like Oasis, Rougemont and Fruite etc.

Investment Data
  • Opportunity Score: 79%
  • Ticker: TSE:LAS.A
  • Sector: Consumer Defensive
  • Industry: Beverages - Non-Alcoholic
  • Market Cap: 1.19B
  • P/E: 18
  • Dividend Yield: 1.89%
  • Dividend Payout Ratio: 34.11%

Leon’s Furniture

LNF - Leon's Furniture Leon's Furniture is one of Canada's largest retailers, selling a wide range of goods including furniture, appliances and home electronics. It has become an integral part of Canadian homes. The company also has foreign operations in Asia.

The company has come a long way starting out as a general merchandise store in the small town in 1909, to become a well-known Canadian brand... today. As one of Canada’s largest retailers, Leon’s operates through five powerful banners and a network of over 300 stores and distribution networks from coast to coast, and has $2.6 billion in annual system-wide sales. Leon’s; The Brick; The Brick Mattress Store; and The Brick Outlet are its leading retail banners.

Leon’s Furniture is trusted by shoppers for its merchandise quality, guaranteed lowest prices and fast delivery times. The company is growing through acquisitions, digital commerce and third party distribution and services.

Investment Data

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Opportunity Score Formula

The top 10 stocks identified above are based on a score calculated using a number of financial data points from the companies. In the end, the score is generated from following five key indicators:

  • 52-Week Range: Trend over the past 52 weeks. Is the stock pulling back from a 52 week high?
  • P/E Ratio: Is the stock price running away from its earnings?
  • Dividend Yield: Is the yield attractive? Usually could identify a pullback if the yield starts to go up or major trouble if it goes too high.
  • Dividend Growth: Uses dividend growth and the Chowder Rule. Is the company capable of growing the dividend consistently?
  • Dividend Payout Ratio: Uses historical averages to put today’s ratio in perspective. Is the company able to grow the dividend at the same rate it increases its earnings?

The generated score is meant to assess an entry point opportunity based on historical and today’s numbers. It completely ignores the business quality, the quality of the company is for every investor to assess. My stock selection process breaks down the quantitative and qualitative assessments investors should establish to pull the trigger before buying.

If you are interested in more details, the Canadian Dividend Performance List provides many more data points to help make your investment decision.

Dividend growth investing works and you can generate a healthy retirement income but you have to buy individual stocks. If you are not comfortable with holding individual stocks, you can always buy dividend ETFs or consider different passive income ideas to generate a retirement income.

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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