Canadian Dividend All-Stars Expected To Announce Dividend Increases - Week Of June 4

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Includes: ADWPF, BMO, LRCDF, NTIOF
by: Mat Litalien

Summary

Five Canadian Dividend-All Stars are scheduled to report earnings this week.

Only 1 All-Star is expected to raise dividends.

All three banks raised dividends as expected last week.

As the earnings season comes to a close, only five Canadian Dividend All-Stars are scheduled to report this week. Of which, only one is expected to announce a dividend increase. First, let’s see how the banks fared last week.

LAST WEEK - RESULTS

Last week there were a trio of banking All-Stars expected to announce a dividend increase. The week unfolded as expected with all three coming through with dividend raises in-line with expectations.


EST

DGR

EST

Increase

ACTUAL

DGR

ACTUAL

Increase

NEW

DIV

Bank of Montreal

3.23%

C$0.03

3.23%

C$0.03

C$0.96

National Bank

3.33%

C$0.02

3.33%

C$0.02

C$0.62

Laurentian Bank

1.59%

C$0.01

1.59%

C$0.01

C$0.64

Bank of Montreal (BMO)[TSX:BMO] and National Bank of Canada (OTCPK:NTIOF)[TSX:NA] both deviated from historical raises last quarter. As a result, it was not a surprise to see them both maintain this new standard.

For Bank of Montreal, this meant a C$0.03 per share raise, or 3.25% for a new quarterly dividend of C$0.96. As for National Bank, they announced another C$0.02 per share raise, or 3.33%, for a new quarterly rate of C$0.62 per share.

With its stock price under pressure due to bad mortgages, Laurentian Bank of Canada (OTCPK:LRCDF) [TSE: LB] still managed to raise dividends. The C$0.01 per share raise, or 1.59%, results in a new quarterly rate of C$0.64 per share.

As an aside, the company updated investors on its mortgage situation. Two things stood out. The bad news, was that it found mortgages that were CMHC insured that did not meet CMHC portfolio insurance eligibility criteria. As a result, it expects to re-purchase another $125-$150 million in mortgages related to the CHMC audit. The good news is that the company expects to resolve the mortgage issues by end of year.

EXPECTED INCREASES

Andrew Peller Ltd. (OTC:ADWPF) [TSE: ADW.A]Current Streak – 12 YRS, Current Yield – 0.98%

Earnings Release Date: Wednesday, June 6

What can investors expect: Andrew Peller is one of Canada’s most renown wine producers. It has wineries across Canada and owns and operates over 100 independent retail wine locations in Ontario. The company yields less than 1% which isn’t all that attractive. However, its dividend growth rate has been on the rise and it last raised dividends by 10%. The highest in the company’s history. Andrew Peller’s payout ratio is currently a respectable 46%.

Is another double digit raise in the cards? I would not expect anything above 10% given that it made significant acquisitions in the first three quarters of 2017. This has led to negative free cash flow.

EST DGR

EST INCR

EST NEW DIV

10.00%

C$0.0045

C$0.0495

Disclosure: I am/we are long BMO.

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.