Just a VERY quick update. For the sake of transparency – I always like to try and post when I buy or sell a stock. Today I closed a position in one of the stocks I’ve held for quite some time. I sold all my shares of Plaza Reit. This was actually one of the first stocks I ever owned, and although I ended up making a profit on these shares, and the monthly dividend was nice to see hitting the account each month – truth be told the annual returns have been sub par. I’ve been wanting to add some Canadian Banks to my portfolio and was torn between which one to add, so I ended up using the proceeds and buying 363 shares of RBNK. This is an ETF that has just 6 holdings (All 6 of the big Canadian banks). The best part is, it pays a monthly dividend, and I’ll have enough to drip 1 additional share each month!
I still like Plaza Reit, and may consider adding it again on dips. I could definitely see myself moving back into Plaza in retirement as well when monthly cashflow will be more important – but for now, I am much more comfortable holding the big Canadian Banks, and I believe they will outperform Plaza (by quite a bit) over the next 10 years.
Stocks on my current watchlist are:
Equitable Group (do not own)
Metro (do not own)
Manulife (recently added to my position)
GoEasy (currently own)
CCL (do not own)
CP Rail (do not own)
Empire (do not own)
With the recent purchase of Manulife and now RBNK, the TFSA’s are pretty empty as far as cash reserves go – so I’ll be slowly adding cash until I am ready to make another purchase (thinking EQB will be next).
In the RRSP, I am still sitting on quite a bit of cash, and will be looking for some US companies to nibble on. Ideally I’d like to see a dip and either up my position in XAW, or start positions in: Visa, Disney, Microsoft.
Once or twice a year I like to update my watchlist for stocks to keep an eye on in the coming months. My favorite way of doing this is by running a custom stock screener, using multiple metrics to slowly narrow the list down. Since there are so many stocks to go through – I like to start by first narrowing it down to some quality names, who have a history of paying dividends , and luckily there is a great tool for this- The Canadian Dividend All Star List. This list is updated each month and is a great starting point for anyone looking for quality dividend stocks in Canada.
This list includes just about every metric you can think of. Personally I use about 25-30 different metrics when I run my custom screen, and for each I consider a value that meets my risk profile and investment goal. I then highlight any stocks in green that meet/exceed this target and any in red which do not. For a very basic example, let’s say the metric I am evaluating is payout ratio. In this example, let’s assume I think a payout ratio of 40% or less is great, and anything over 70% concerns me. In this scenario I would highlight all stocks with a payout ratio under 40% in green(and score them +1), and all stocks over 70% in red(score of -1). Anything in between would be left as is(no score). If you want, you can also assign different weights to different metrics. For example, perhaps “value” is most important to you – so you may weight P/E higher than dividend growth rate. I do this for each metric, and when I am done I tally up the scores. What I like about this method is that although it’s not really scientific in it’s approach, it allows each individual investor choose stocks that fit THEIR own personal comfort level. I would also like to note that I use this ONLY as a starting point. Once I end up with my top scoring stocks – I never dive right in and purchase them. This is just a starting point. Once I’ve narrowed it down to my top 10, I then go to the company website to learn more about the company, read the investor presentations, financial statements and analyst comments to dig in further.
Blind Stock Screen
As regular readers may know, I am a pretty big fan of whisky (specifically bourbon), and sometimes I like to do blind taste tests. I prefer to do tastings blind, because I want to know which bourbons truly provide the best value, and I want to ensure I am not tricking myself into thinking I like it because it’s expensive, or because a bunch of people say how great it is. When I am looking for value in stocks, I take the same approach. Here is a pic from the last blind tasting we did (back when we could still see people in person):
Prior to starting the screen I always HIDE the company name & stock symbol. I do this because I don’t want any bias to come into play, and honestly, I like being surprised at the end to see if certain companies I assume fit my investing profile actually do or not. In the past, some of my top performing stocks have come from this method, including: Goeasy, Manulife & Transcontinental.
Stock Screener Metrics Used
I would again like to reiterate that each investor will probably have different metrics they use, since a lot of us have different goals. Personally, I consider myself a value investor who is interested in long term dividend paying stocks who pay a growing dividend. Here are just a few of the metrics I used in my stock screener (in no particular order) :
Dividend Growth Rate (I use the 1,5 & 10 year growth rates)
Dividend Growth Streak (# of years)
Payout ratio (Trailing 12 month & Estimated next 12 month)
Trailing 12 month Earnings Per Share & Estimated EPS
Earnings Per Share Growth (1 year, 3 year, 5 year & 10 year)
Sales Per Share Growth
Difference between analyst price target & current share price (I don’t put too much stock into this one)
Canadian Dividend All Stars To Watch
So which companies scored best on my most recent screen? There are a few names I was not surprised to see, a few that I was surprised to see, and if I am being completely honest, a couple of names I had never even heard of. By doing this blind screen it can:
Introduce you to new potentially great stocks (to do further research on)
Confirm that some preconceived notions you had about some stocks are correct (or incorrect)
Takes any sort of bias/group think out of your decision making.
Top 10 Canadian Dividend Stocks
Here are the 10 stocks that ranked highest in my blind screen.
Equitable Group Inc (nearly a perfect score)
Enghouse Systems Ltd
iA Financial Corporation
Canadian Tire Corp Ltd
Canadian Pacific Railway
The top 10 includes a few companies I either already own, or have been looking to purchase(Equitable Group, Go Easy, Empire, CCL, etc), as well as one company I had never heard of (PFB Corp). $EQB scored the highest of all stocks by quite a bit, though I believe almost every company on this list would be a great long term hold. I’ve now officially added PFB to my watchlist and plan to dig a little deeper into it.
I would also like to include a couple that fell just outside the top 10 that I will also be adding to my watchlist. They are:
Hardwoods Distribution Inc
Alimentation Couche Tard
Brookfield Asset Management
Having recently purchased Couche Tard I am happy to see it ranked highly in my screen. I’d also like to point out that although I don’t know much about Hardwoods Distribution Inc, every single time I have run a screen in the last couple of years it has shown up. I am not sure why I haven’t bought it yet (I wish I did, as it has gone up about 90% since my last screen).
I’m glad I’ve been able to add a bunch of names to my watchlist, now I just need this damn market to cool down so I can dive in and make some purchases! If you have any questions or metrics that you use when evaluating stocks, please let me know in the comments or reach out on twitter!
Another year has come and gone – although this particular year feels like it’s dragged on for a decade. I think I speak for most of the world when I say I cannot wait for this dumpster fire of a year to be over. Although I don’t expect 2021 to be a complete return to the norm – I am hopeful we will start to see things slowly open back up, and there is definitely a lot of promising news on the vaccine front.
Two years ago I created a list of some of my favourite Canadian investment blogs, which a lot of people seemed to like. I didn’t do one last year, but decided I’d create a new list (with some familiar names, and a few new ones). This year has been so ridiculous that I haven’t put nearly as much time into updating this site, or reading other sites, but I still spend a lot of time on twitter which I believe is a great way to consume a lot of info a short period of time. On that note -I’ll include twitter accounts to follow that I highly recommend as well.
While this year will still be quite heavily focused on Canadian Investing websites(since the majority of my investing/research is focused on Canadian Equities) – I will be including a few friends from down south and overseas as well. Okay enough blabbering. Here is my list (in no particular order) of the top Investments sites & twitter personalities to follow in 2021!
Great for both beginners and advanced investors. The site is largely focused on building wealth over time, does in depth reviews of ETFs & Stocks and shares his portfolio/journey. Mark has been around for quite some time and was one of the first Canadian Investing Sites I started reading. He is also very active on twitter, and like me enjoys beer, whisky and hockey! Website: https://www.myownadvisor.ca/ Twitter: https://twitter.com/myownadvisor
Matt from All About The Dividends is another Canadian investor about the same age as me. What I like most about Matt is his openness in sharing his portfolio and thoughts behind his investment decisions. Matt may also be the most positive and encouraging person you will ever find on twitter. Website: https://allaboutthedividends.wordpress.com Twitter: https://twitter.com/AllAboutTheDivi
Bert & Lanny are the two diplomats behind the site. They are the first non Canadian investors on my list, but they deserve to be mentioned. I enjoy reading their site for a few reason: -to get some ideas on non Canadian dividend (USA) stocks – to check up on their portfolios (which they share freely) – to read my favorite posts each month- when they highlight other investors passive income journeys They have also recently launched a youtube channel. Website: https://www.dividenddiplomats.com/ Twitter: https://twitter.com/DvdndDiplomats
The boys in the garage are great fun. They discuss everything from personal finance, investing, tax efficiencies and more. They do this on their website, twitter as well as their podcast (they had me on as a guest earlier this year). You can check out that episode HERE. Another reason I love listening to these guys, is they are very down to earth, and along with discussing finance on each podcast, they also have a beer (or bourbon) and discuss those as well.
Another non Canadian site to add to the list. Cheesy Finance chronicles the journey of a young dutch as they pursue F.I.R.E. The site has sections in both English & Dutch, and they are very active on twitter as well. Cheesy also enjoys beer – and likes to taunt us on twitter with his superior beer collection. Website: https://cheesyfinance.nl/ Twitter: https://twitter.com/CheesyFinance
This is a site I was just recently introduced to, but I am glad I was. The in depth coverage on Canadian REITS is fantastic. They first got my attention when I read their pieces on Sandpiper/Artis Reit. They don’t post new updates as often as I’d like, but when they do they are very in depth. They are active on twitter as well. Website: https://konekoresearch.com/ Twitter: https://twitter.com/KonekoResearch
Need a laugh? Look no further than the Stonk Market. Picture the onion if it only focused on investing and finance. Admittedly I don’t visit the website that often – but I laugh out loud to myself a few times a week just reading their tweets. So if you need a break from doing stock screeners, fundamental or technical analysis of stocks – then give them a read.
Gen Y makes the list again for good reason. Her site focuses a lot more on the personal finance side of things (credit card rewards, budgeting, etc and is also a great resource for new investors starting out). We also own a lot of the same stocks and I like to have friendly competitions with her about who is earning more in dividend income. *Spoiler Alert* She is kicking my ass! Website: https://www.genymoney.ca/ Twitter: https://twitter.com/genymoneyca
Dale from Cut The Crap Investing is quickly becoming very well known in the Canadian personal finance space. He contributes to Moneysense, Million Dollar Journey and Seeking Alpha. He is a champion of low cost ETF’s (he probably cringes to know I pay 1.4% MER on a Canadian Mutual Fund) and is always willing to share his thoughts on stocks and suggestions on twitter. Website: https://cutthecrapinvesting.com/ Twitter: https://twitter.com/67Dodge
Rob from Passive Canadian Income seems like one of the guys in the online personal finance community that I’d most likely wanna go grab a beer with. He is super down to earth, very open about his financial journey and has multiple streams of income including dividends, solar power & a private investment which pays him a nice sum each month. His taste in beer is definitely lacking – but I am sure he will grow up one day.
Tyler from Canadian Value stocks is one of the few sites who continually puts out quality, in depth article and deep dives on specific stocks. One thing I love about his site is how clean/to the point it is – it’s just straight down to business. Nothing fancy – just quality stock analysis. He focuses on Canadian stocks, and is very knowledgeable about the Canadian REIT sector.
Bob from TAWCAN (which is short for Taiwanese Canadian) is another Canadian finance site with topics ranging from dividend stocks, ETFS, F.I.R.E and more. His website is another great resource for people wanting to learn more about investing in Canada. He also shares his monthly dividend income – which is very impressive!
I am always looking for new content to consume – so if you have any recommendations of investing blogs or twitter accounts that focus on Canadian Dividend Stocks, or Canadian Equities – please let me know in the comments.
June 19 was our 10 year wedding Anniversary. Originally I had wanted to do a European trip to celebrate, however due to Covid, things were a lot more quiet and a lot less expensive. That said, thanks to the grandparents offering to take the kids to the lake for a couple days, we were still able to go out for dinner (first time in a restaurant in months), and have 2 nights alone with no kids. It was nice, we went to a nice steakhouse, I opened up a fancy bottle of bourbon I’ve been saving for a special occasion(pictured below) and most importantly we got to sleep in!
We’ve been spending most weekends out at the lake, and it has been HOT. This last weekend was 32-34 degrees and we went for a lot of swims. The kids absolutely love going to the lake. So far, not selling the cabin seems to have been the right move. That said, next year I think I am definitely going to hire a company to come spray for mosquitoes and spiders…holy smokes they are bad this year.
I’ve definitely gained some weight since the Covid pandemic. I had just gotten into a decent routine of running on the treadmill almost everyday, I was playing soccer again, and I had cut my beer intake down quite a bit. Once Covid hit, and the kids were home all day, it changed everything, and made things a lot more difficult. The good news is the kids are heading back to daycare tomorrow, so hopefully we can all get back into our routines right away.
Normally on Canada day there is a big parade out at the cabin, and a bunch of fireworks, celebrations, etc. This year there was nothing. That said, the kids still had a great time, and we did our best to represent some Red & White.
Financial Highlights for June:
Pre authorized bi-weekly contributions continued into both TFSA & Spousal RRSP. I may have to look at reducing the amounts now that we will be paying for daycare again.
June was an expensive month. Cabin taxes were due, had to fix my eavestroughs, spent a decent chunk on our anniversary dinner, and pre paid for next 2 weeks of daycare.
On the plus side, June was also the month XAW paid one of its semi annual distributions.
I was paid dividends from 6 companies, and 2 funds this month. I dripped a total of 80 new shares/units.
Passive Income Update For June 2020.
Diversified Royalty: $22.85(dripped 12 shares)
Canadian Western Bank: $0.29
Artis Reit: $28.35 (dripped 3 shares)
Interrent Reit: $4.29
Plaza Reit: $29.91 (dripped 8 shares)
Intertape Polymer: $55.12
TFSA’s Total: $140.81
Canadian Equity Income Distribution: $353.49(dripped 13.748 shares)
XAW Distribution: $1172.13 (dripped 44 shares)
Total Passive Income June 2020:$1666.43
My portfolio was up slightly to: $343,539.41 This represents a increase of 2.69% from last month. I expect continued volatility in the market (and my portfolio) for the foreseeable future.
My long term plan hasn’t changed. I haven’t sold a single stock, and I continue to look for good deals. I’m sitting on a bit of cash, and I’ve updated my watchlist, which currently contains: Manulife, First National Bank, Alimentation Couche-Tard, Telus, Metro and Canadian Western Bank (among a few others). I haven’t pulled the trigger on any of these yet, because I still think things are going to get worse before they get better.
Passive income in June was $1666.43. June was my second highest month in 2020. So far in the first six months of the year I’ve earned $6225.84 in passive income. The second half of the year unfortunately shouldn’t be as strong, as there won’t be another big XAW distribution until January 2021.
Assuming no dividend cuts or increases, my current Forward 12 month dividend income is $11,405.96.