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Last Monday, I pulled out the Best U.S. Stocks for 2012 with 182 companies listed in this post. As mentioned previously, I wanted to do the same thing on the Canadian stock market to be fair and to show you which companies are interesting to own in Canada even if you are a U.S. citizen. You know this by now; I’m a big fan of some Canadian stocks as I think that the banking industry in Canada along with the resources sector can bring a lot to one’s portfolio.

While I was surprised to pull out 182 stocks on the U.S. stock market, I was even more surprised to pull out… 32 stocks on the Canadian market with the same metrics!

Canadian vs US

As a Canadian myself, it is obviously easier to buy Canadian stocks as I avoid currency risk and tax complications (depending on the type of account you are trading in). However, in the light of this chart showing a pitiful 32 stocks (of which seven are banks, six others related to financial services and four telecoms), as Canadians you have no other choice but to consider U.S. stocks as well. Just for the sake of diversification, you need to look elsewhere if you want to build a strong dividend portfolio. This was also the reason why I’ve put only nine Canadian stocks in my Best Dividend Stocks for 2012 eBook.

Best Dividend Stocks for 2012

The chart is based on the same filters:

  • Dividend Yield over 3%

  • Dividend Payout Ratio under 75%

  • 5 Years Dividend Growth positive

[Note that stock tickers are U.S.-traded symbols where applicable- Ed.]

TickerNameINDUSTRY_SUBGROUPPriceDividend YieldPayout RatioDividend Growth 5 Years
IGMIGM Financial IncInvest Mgmnt/Advis Serv44.794.873.996.96
SJR/BShaw Communications IncCable/Satellite TV19.794.6572.5626.15
CLKClubLink Enterprises LtdDiversified Operations6.414.5570.884.56
GWOGreat-West Lifeco IncLife/Health Insurance19.536.370.375.81
CFN-UCarfinco Income FundFinance-Consumer Loans6.925.268.992.73
OTC:MAMTFMCAN Mortgage CorpFinance-Mtge Loan/Banker13.18.2467.5111.76
BCEBCE IncTelecom Services41.145.2762.458.16
TUTELUS CorpTelecom Services56.954.0762.0912.94
XTMX Group IncFinance-Other Services41.53.8558.153.92
OTC:CBYDFCorby Distilleries LtdBeverages-Wine/Spirits15.333.9258.143.35
OTC:CSQPFCervus Equipment CorpRetail-Gardening Prod154.857.816.72
OTC:CLNFFCalian Technologies LtdConsulting Services17.196.0656.6923.61
MEOHMethanex CorpChemicals-Specialty22.83.156.233.76
BMOBank of MontrealCommer Banks Non-US54.945.154.134.38
CEUCanadian Energy Services & Technology CorpOil-Field Services11.414.7353.4714.37
OTC:BIRDFBird Construction IncBuilding&Construct-Misc11.495.7653.4517.6
OTC:EHMEFeasyhome LtdRental Auto/Equipment6.785.0151.917.21
RCI/BRogers Communications IncCellular Telecom38.813.6548.370
CMCanadian Imperial Bank of Commerce/CanadaCommer Banks Non-US73.64.8947.744.93
RYRoyal Bank of CanadaCommer Banks Non-US48.954.4146.617.63
OTCPK:CJREFCorus Entertainment IncMultimedia20.384.2645.3220.49
NDNNordion IncMedical Products8.344.9244.6325.14
BNSBank of Nova ScotiaCommer Banks Non-US49.484.2144.366.45
OTC:ADWPFAndrew Peller LtdBeverages-Wine/Spirits9.33.8743.129
TDToronto-Dominion Bank/TheCommer Banks Non-US73.453.740.5713.93
OTC:GHIFFGamehost IncCasino Hotels11.147.939.53.06
OTCPK:NTIOFNational Bank of CanadaCommer Banks Non-US71.474.238.361.2
OTCPK:LEFUFLeon's Furniture LtdRetail-Home Furnishings12.23.2835.546.76
OTCPK:LRCDFLaurentian Bank of CanadaCommer Banks Non-US47.393.833.696.91
OTC:ACCFFAccord Financial CorpFinance-Commercial6.874.3731.918.45
OTC:MODVFMelcor Developments LtdReal Estate Oper/Develop12.43.2323.475.92
MGAMagna International IncAuto/Trk Prts&Equip-Orig32.893.1510.482.95

Out of this list, I’ve published several dividend stock analyses over at Canadian Dividend Stock including the following: BCE, Telus, Great-West Lifeco, Corus, National Bank, TD Bank, Royal Bank, BMO, ScotiaBank, CIBC, Rogers, and Shaw Communications.

Another great option for Canadian investors that is not listed in this article is to consider Canadian REITs. But even then, this is not enough to cover all industries and have a well diversified portfolio. Unfortunately, when a sector is not doing so well or show some concerns from investors; all stocks related to this industry will go bad.

Therefore, you could think that building a “bank” portfolio along with a few other stocks and a few REITs may be good enough. In fact, such a portfolio would payout some healthy dividends and you could think it’s a good way to invest. However, being concentrated in a couple of sectors also means that you are dependent on their growth to perform over the long term. If you know which sectors are going to perform over the next 5 years, then, you are all set. But unfortunately, we don’t see such crystal ball on sale at Wal-Mart yet…

Source: 32 Top Canadian Dividend Stocks For 2012