Canadian Dividend All-Star November Raises

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Includes: BOWFF, CBYDF, CDNAF, CGEAF, CGECF, CRBBF, EBGUF, ENB, EQGPF, GCAAF, GMICF, HLNFF, IIP.UN, IPPLF, SYZLF
by: Mat Litalien

Summary

15 Dividend All-Stars raised dividends in November.

Two All-Stars raised for the second time, while another raised for the third time.

Enbridge Income Fund provides investors with a good entry point at today's prices.

Dividend growth investors, such as myself, look for quality companies who have a history of raising their dividends on a regular basis. Although not as comprehensive as the U.S. Dividend Champions list, Canada's dividend paying companies also present investors with dividend growth opportunities and have thus far received limited coverage on SA. This is a monthly series that identify the most recent dividend increases of the Canadian Dividend All-Stars, companies who have raised their dividend for at least 5 consecutive years.

Of note, U.S. based investors should be aware that they are subject to a 15% withholding tax on dividends paid within a taxable account. On the other hand, should U.S. based investors hold their Canadian dividend paying stocks in their retirement accounts, there are no withholding taxes on dividends paid due to our mutual tax treaty.

November Updates

After a couple of slow months, there was plenty of action in November as 15 different All-Stars raised dividends. Of those, there were a few pleasant surprises as both Enbridge Income Fund (OTC:EBGUF) [TSE: ENF] and Equitable Group (OTC:EQGPF) [EQB] announced their second raises of the year, while Enbridge (ENB) [TSE: ENB] announced its third increase in 2017. Of the companies that raised their dividends in November, only Enbridge is dual-listed which means it can be found on both the major U.S. and Canadian stock exchanges, while the others can be purchased by U.S. investors either on the TSX or through the OTC market.

Ticker

Company Date Yield Old New

Inc.

(OTCPK:CGEAF)

Cogeco Communications

Nov-02-17

2.42

$ 0.4300

$ 0.4750

10.47

(OTC:CGECF)

Cogeco Inc

Nov-02-17

2.20

$ 0.3400

$ 0.3900

14.71

(OTCPK:GMICF)

Genworth MI Canada Inc

Nov-03-17

5.39

$ 0.4400

$ 0.4700

6.82

(OTC:EQGPF)

Equitable Group Inc

Nov-09-17

1.48

$ 0.2400

$ 0.2500

4.17

(OTCPK:CDNAF)

Canadian Tire Corp Ltd A Nvtg

Nov-09-17

1.88

$ 0.6500

$ 0.9000

38.46

(OTCPK:IPPLF)

Inter Pipeline

Nov-09-17

5.74

$ 0.1350

$ 0.1400

3.70

(OTC:HLNFF)

High Liner Foods Inc

Nov-09-17

2.93

$ 0.1400

$ 0.1450

3.57

(OTCPK:CBYDF)

(OTC:CRBBF)

Corby Spirit and Wine Ltd

Nov-09-17

3.74

$ 0.2100

$ 0.2200

4.76

(OTC:GCAAF)

Guardian Capital Group Ltd.

Nov-09-17

1.39

$ 0.0850

$ 0.1000

17.65

(OTCPK:BOWFF)

Boardwalk Real Estate Investment Trust

Nov-14-17

4.64

$ 0.1825

$ 0.0834

-54.30

(IIP.UN)

InterRent Real Estate Investment Trust

Nov-14-17

3.28

$ 0.0203

$ 0.0225

11.11

(BYD.CA)

Boyd Group Income Fund

Nov-17-17

0.61

$ 0.0430

$ 0.0440

2.33

(OTC:SYZLF)

Sylogist Ltd.

Nov-21-17

2.92

$ 0.0700

$ 0.0800

14.29

(OTC:EBGUF)

Enbridge Income Fund Holdings Inc.

Nov-29-17

6.01

$ 0.1711

$ 0.1883

10.05

(ENB)

Enbridge Inc

Nov-29-17

4.21

$ 0.6100

$ 0.6710

10.00

The markets have been on a tear as of late hitting all-time highs but despite this, there is some value to be had here. In particular, it appears that Enbridge Income Fund currently offers investors a good entry point.

Enbridge Income Fund [TSE: ENF] - Sector: Utilities: Industry: Independent Power Producers

(Streak: 6 Years)

The company has struggled lately and its share price has dropped approximately 14% year to date which has presented investors with a good opportunity. Of note, the company recently announced a guidance update where they expect continued strong free cash flow and a growing dividend at a 10% compound annual growth rate through 2020. They also announced a $500 million common share offering which was received with mixed reaction, but overall the company is well positioned for continued growth. The market seemed to be receptive to their announcements as the stock rose 3.18% on the day.

When comparing against their historical P/E ratio, the company seems to be trading slightly below their historical averages (See F.A.S.T. Graph below). Likewise, when looking at their Graham Number, they appeared significantly undervalued. The current share price of C$29.86 is almost 30% below their Graham Number of C$38.72, which is not surprising given they are also trading below book value at 0.95x. Finally, 10+ analysts have an average target share price of $34.60, with a low of C$31.00 implying upside of about 16% from today's share price.

On the other hand, their PEG ratio is currently at 1.18x which indicates that the company's share price is keeping up with expected earnings and is trading in-line with fair value.

Despite the slight share price appreciation after this week's guidance, Enbridge Income Fund provides good value. At these prices and with the anticipated growth over the next few years, investors should be comfortable initiating or adding to existing positions and can look forward to double digit dividend increases through 2020.

Disclosure: I am/we are long EBGUF.

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 covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.