High Expectations for Canadian Banks Is Unrealistic [View article]
First off to Seeking Alpha, the title of the article is not proper grammar; please revise.
To Chez, Just as the sell off was overdone, the rally is overdone in Canadian banks. I would have alluded to all banks if I actually felt that way. I feel US banks offer better long term value still.
All your points are common knowledge and I was not disputing any of them except for the fact that I did not say that a 4.7% yield is unsustainable; just not as attractive as 7-9%. The point is, what has changed since the yields were 7%+, not much. I had as much confidence in the dividend then as I do now. These should be bought when fear is commonplace not when euphoria overshoots on the upside. Any return on investment in these slow growth entities has been diminished significantly since Feb-March.
After a Dividend Freeze: Hold or Sell? [View article]
Dividends are not the be all and end all. Consider other characteristics and why you bought the company in the first place. In these times companies are freezing dividends like crazy, they certainly can not all be bad firms.
Gino I think you are oversimplifying. Price to book is not simply a reflection of financial wherewithall (free cash flow etc.). The ratio also reflects the earning power of assets that contribute to book. A tech firm will always have a higher price to book than a resource firm, regardless of their balance sheet.
TD is indeed a good bank. Their Canadian retail franchise is a step above. Canadain consumers are seeing rough times but this is prices into the stock at current levels. 6% yield that I consider to be relatively safe makes me really not care too much about the next few years. The share price can fluctuate but I'll be happy collecting my dividends and knowing that TD will excel long term. It is really a proxy on the Canadian economy which will recover mid-long term.
Companies I Invest In? Those With a Future [View article]
If every company I own cuts its dividend by 50% then I am probably making some bad decisions by trying to buy quality stocks when they are cheap and yielding more than 4.7%. Are corporations that manufacture branded alcoholic beverages, and produce and distribute electicity likely to be affected by a very weak economy, probably not to th extent that they'd cut their dividend 50%.
For that matter, will insurance companies and banks in Canada be in situations where they'll be forced to cut their dividends? Perhaps, but I am betting that they won't. Bank of America cut their dividend by 50% after losing billions on bad mortgages, etc., yielding over 8% at times, and making two industry changing acquisitions. Canadian financial institutions are in much better shape than any of the major U.S. banks that have faltered or cut their dividends.
Surprise: Bank of America Cuts Dividend By 50% [View article]
As much as I like companies to 'pay daddy', these are unprecedented times and i belive that the CFC and MER acquisitions will pay dividends in the future.
Dividends: A Bright Spot In a Bleak Time [View article]
Saying that my yield is going up is not an accurate way to represent anything. My yield on cost will only go up if the companies that I own raise their dividends or I buy more at depressed prices. I don't really expect my income from investments to decrease, at the very least it should grow more slolwly than it has in the past. This will give me an opportunity to buy more shares at depressed prices.
Husky Energy: High Yielding Oil Play [View article]
Husky just raised their dividend by 25% and announced an earnings increase of 89%, the stock is now yielding about 4.9%.
I am a little confused as to where this conversation has gone. A yield of 4% for any stock is pretty solid if the underlying growth is still there. Yes dividends cushion falls, another reason why dividend investing is a great strategy for long term capital appreciation.
Husky Energy: High Yielding Oil Play [View article]
While I am certainly not an 'expert'. A rising dividend with a starting point absolutely beats inflation unless the rate is out of control. Canada's inflation rate is expected to peak at around 4.3%, but is usually kept below 3%. Husky is not a pink sheet stock for me, as I live in Canada. In Canada we have few energy stocks that yield at this level of dividends which are very tax favourable.
Sort by:
Latest | Highest ratedWhy Shoppers Drug Mart Should Raise Its Dividend [View article]
Why I Bought CAT [View article]
High Expectations for Canadian Banks Is Unrealistic [View article]
To Chez,
Just as the sell off was overdone, the rally is overdone in Canadian banks. I would have alluded to all banks if I actually felt that way. I feel US banks offer better long term value still.
All your points are common knowledge and I was not disputing any of them except for the fact that I did not say that a 4.7% yield is unsustainable; just not as attractive as 7-9%. The point is, what has changed since the yields were 7%+, not much. I had as much confidence in the dividend then as I do now. These should be bought when fear is commonplace not when euphoria overshoots on the upside. Any return on investment in these slow growth entities has been diminished significantly since Feb-March.
After a Dividend Freeze: Hold or Sell? [View article]
Trading Under Book Value [View article]
Bank of America Seems Serious About Retaining Its Dividend [View article]
TD Bank - Too Good to Pass Up [View article]
Sysco: A Surprising Inflation Hedge [View article]
TD Bank - Too Good to Pass Up [View article]
Companies I Invest In? Those With a Future [View article]
For that matter, will insurance companies and banks in Canada be in situations where they'll be forced to cut their dividends? Perhaps, but I am betting that they won't. Bank of America cut their dividend by 50% after losing billions on bad mortgages, etc., yielding over 8% at times, and making two industry changing acquisitions. Canadian financial institutions are in much better shape than any of the major U.S. banks that have faltered or cut their dividends.
Surprise: Bank of America Cuts Dividend By 50% [View article]
Dividends: A Bright Spot In a Bleak Time [View article]
General Electric Presents a Dividend Opportunity [View article]
Husky Energy: High Yielding Oil Play [View article]
I am a little confused as to where this conversation has gone. A yield of 4% for any stock is pretty solid if the underlying growth is still there. Yes dividends cushion falls, another reason why dividend investing is a great strategy for long term capital appreciation.
Husky Energy: High Yielding Oil Play [View article]