In Safe Monthly Pay SML Dividend Dogs, Canada Leads 27 To USA's 15

|
Includes: AGGZF, AGNC, ARESF, BOWFF, CJREF, CLDT, FSC, GAIN, MFCSF, PMULF, PSEC
by: Fredrik Arnold

Summary

15 of 51 USA, and 27 of 60 Canadian equities, paying dividends monthly (MoPay) are considered safe since free cash flow yield exceeded dividend yield, providing margin to cover dividends.

Top USA safe MoPays BOWFF; MSCSF; AGGZF; PMULF; CLDT; GAIN; ARESF; CJREF; AGNC; PSEC dividend yields ranged 4.51%-12.55% while cash-flow yields were 5.84%-46.24 as of September 16.

Top Canadian safe MoPays were FC.TO; GH.TO; BDT.TO; AI.TO; AX-UN.TO; KWH-UN.TO; TF.TO; CJR-B.TO; DCI.TO; NBZ.TO dividend yields ranged 6.81%-13.11% as cash-flow yields spanned 5.84%-46.24% September 16.

Broker USA targets revealed ten top yield safe MoPay dividend stocks promising 4.03% LESS gain from $5k invested in the lowest priced five than from $5K invested in all ten.

Canadian Broker targets uncovered ten top yield safe MoPay dividend stocks showing 1.93% more gain from $5k invested in the lowest priced five than from $5K invested in all ten.

The Dividend Dogs Rule

The "dog" moniker was earned by stocks exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs."

What US & Canadian Sectors Paying Monthly Dividends Show Up With "Safe" Equities?

Top ten US MoPay equities by yield posting cash margins greater than their announced annual dividends came from the financial services (2), real estate (5), consumer cyclical (1), industrials (1), and healthcare (1) sectors. Their Canadian counterparts included energy (1), industrials (2), consumer cyclical (2), financial services (3), utilities (1), and real estate (1).

15 of 51 US and 27 of 60 Canadian MoPay Dogs Have Cash Margins Greater Than Dividends

Annual Safety Inspection

A previous article discussed the attributes of 111 US & Canadian MoPay stocks from which these 15 and 27 were sorted. You see below the lists that passed the dividend "stress" test. These 42 monthly pay dividend dogs report sufficient annual cash flow yield to cover their anticipated annual dividend yield. The margin of excess is shown in the last column.

Financial guarantees however are easily over-ruled by a cranky board of directors or company policy canceling or varying the payout of dividends to shareholders. For example, on the US list below, Fifth Street Finance (NYSE:FSC), and Prospect Capital (NASDAQ:PSEC) cut their monthly dividends from $.092 to $.06 and from $.111 To $.083 respectively as of January 2015. Also, American Capital Agency (NASDAQ:AGNC) announced July 27 a reduction of its $.20 monthly shareholder payout to $.18 as of September. The Canadian equities, Northern Blizzard (NBZ.TO) cut its dividend in half in July 2015; Crius Energy (KWH-UN.TO) cut its payout 30% in 2014; Gamehost (GH.TO) reduced its dividend 20% in June, to name three.

Dog Metrics Looked For Bargain US & Canadian MoPay "Safe" Stocks

Ten "Safest" top MoPay USA revenue stocks showing the biggest yields September 16 per YCharts data ranked themselves by yield as follows:

Actionable Conclusions: (1) Analysts Predicted 5 Lowest Priced of USA Ten Monthly Pay Dividend Dogs To Deliver 8.35% VS. (2) 8.70% Net Gains from All Ten by Come September, 2017

$5000 invested as $1k in each of the five lowest priced stocks in the "safe" ten USA MoPay kennel by yield were determined by analyst 1 year targets to deliver 4.03% LESS net gain than $5,000 invested as $.5k in all ten. The eighth lowest priced safe MoPay dog, Chatham Lodging Trust (NYSE:CLDT), was projected to deliver the best net gain of 21.87%.

Lowest priced five "safe" USA MoPay dogs as of September 16 were: Pure Multi-Family REIT (OTCQX:PMULF); Prospect Capital ; Gladstone Investment (NASDAQ:GAIN); Corus Entertainment (OTCPK:CJREF); Artis REIT (OTCPK:ARESF), with prices ranging from $5.92 to $9.40.

Higher priced five Safe MoPay dogs for August 19 were: Medical Facilities Corporation (OTCPK:MFCSF); American Capital Agency; Chatham Lodging Trust; Ag Growth International (OTCPK:AGGZF); Boardwalk REIT (OTCPK:BOWFF), whose prices ranged from $16.27 to $37.93.

Actionable Conclusions: (1) Analysts Imagine 5 Lowest Priced of CAN Ten Monthly Pay Dividend Dogs To Deliver 7.01% VS. (2) 6.88% Net Gains from All Ten As Of September, 2017

$5000 invested as $1k in each of the five lowest priced stocks in the "safe" ten MoPay kennel by yield were determined by analyst 1 year targets to deliver 1.93% more net gain than $5,000 invested as $.5k in all ten. The very lowest priced safe Canadian MoPay dog, Northern Blizzard (NBZ.TO) , was projected to deliver the best net gain of 14.94%.

Lowest priced five "safe" Canadian MoPay dogs as of September 16 were: Northern Blizzard; Timbercreek Financial (TF.TO); Crius Energy (KWH-UN.TO); Gamehost (GH.TO); Bird Construction (BDT.TO), with prices ranging from $5.90 to $9.95.

Higher priced five Safe MoPay dogs for September 16 were: Corus Entertainment (OTCPK:CJREF); Atrium Mortgage Investment (AI.TO); Artis REIT (AX-UN.TO); DirectCash Payments Inc. (DCI.TO); Firm Capital Mortgage Investment (FC.TO), whose prices ranged from $12.10 to $13.74.

This distinction between five low priced dividend dogs and the general field of ten reflects the "basic method" Michael B. O'Higgins employed for beating the Dow. The added scale of projected gains based on analyst targets contributed a unique element of "market sentiment" gauging upside potential. It provided a here and now equivalent of waiting a year to find out what might happen in the market. Its also the work analysts got paid big bucks to do.

A caution is advised, however, as analysts are historically 20% to 80% accurate on the direction of change and about 0% to 20% accurate on the degree of the change.

The net gain estimates mentioned above did not factor-in any foreign or domestic tax problems resulting from distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.

See my instablog for specific instructions about how to best apply the dividend dog data featured in this article. --Fredrik Arnold

Stocks listed above were suggested only as possible starting points for your safest MoPay dog dividend stock purchase research process. These were not recommendations.

Three of these monthly paying dividend pups qualify as valuable catches! They are listed with the 52 Dogs Of The Week (DOTW) found on The Dividend Dog Catcher premium site. Click here to subscribe or get more information.

A top performing DOTW dog for the first quarter has been named. A second quarterly winner was discovered May 13. A third quarter winner was announced Monday, August 22.

For a free copy of both previous quarterly reports Q1, & Q2 and analysis of the new winning Arnold Q3 pick of August 22, send your e-mail address, ticker symbol for your favorite dividend stock, and name of your favorite team of any sport or activity to: fredrika120@gmail.com. Remember: E-mail, ticker, team!

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from ycharts. com; finance.yahoo.com; analyst mean target price by Thomson/First Call in Yahoo Finance. MoneyDog photo from: pinterest.com

Disclosure: I am/we are long FSC.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.