Happy 2019, everyone! It has been two years since I began my weekly coverage of Canadian Dividend All-Stars. Canadian Dividend All-Stars are Canadian stocks listed on the Toronto Stock Exchange that have raised dividends for, at minimum, five consecutive years. My series focused on anticipating upcoming dividend increases and subsequently estimating the amount of the increase. Typically, I base my estimates on historical data along with current events, and with 2018 in the rear-view mirror, let’s see how the year unfolded!
Accurate Estimates
As mentioned previously, I rely primarily on historical data to anticipate the timing of expected increases and the amount of the dividend increase. I'm happy to report that predicting the timing of dividend raises once again proved accurate.
Of those expected to raise dividends, 92% came through with a dividend raise, while only 8% failed to announce an increase in 2018. In comparison, 2017 results were 93% and 7% respectively.
Despite cross-referencing three different sources for dividend declaration dates and earnings releases, I missed about a dozen dividend announcements. On that same note, there were about a handful that announced a dividend increase which completely caught me off guard. These are companies that raised multiple times in a year and/or changed the timing of their dividend announcements.
My dividend growth rate predictions also proved to be accurate. Of those that raised dividends, 88% came in either in line with or above my estimates. Only 12% of estimates came in below expectations. Once again, this is right in line with my performance in 2017, where results were 87% and 13% respectively.
In 2018, the average dividend raise by companies on the All-Star list was 8.70%, which is right in line with 2017’s average of 8.65%.
I consider 2018 to be another successful year.
