CIBC and Royal Bank Raise Divdiends

My other two bank holdings came through and raised their dividends! This came on the back of BMO hiking dividends earlier this week. CIBC raised dividends 4% to 94 cents a share while Royal Bank increased dividends 5% to 60 cents a share. There was good news for all the Big Five banks as all of them increased dividends this quarter - the first time in recent memory where they all raised dividends at the same time. These hikes definitely help me with my goal of reaching $2200 in dividends payout but that goal may be out of reach seeing as September is coming around soon. I may have to re-evaluate my goals to make them more realistic. Anyways, this was good news and hopefully I'll be able to add my positions in the banks and eventually I plan to own shares in all five because they have consistently shown that they are solid blue-chips that will continue to increase dividends when they are able to.

-the Paperboy

BMO Increases Dividends

The Bank of Montreal announced that it will be raising its dividend distribution - the first time in 5 years. The company will now distribute 72 cents quarterly, a 2.9% increase. The dividend hike came with third quarter results that beat analysts' expectations. All the other banks are reporting this week as well so hopefully there's more good news on the horizon with my other holdings (i.e CIBC and Royal Bank, although both have already increased their dividends recently).

-the Paperboy

BCE Raises Dividends and More on the Astral Deal

Bell beat analysts' estimates for the quarter and decided to increase dividends distributions from $2.17 annually to $2.27 annually. This is great news for me especially because it's been awhile since any of my companies hiked their dividends. This also helps me rebuild my yield what with the fact that Canfor slashed its dividends.

Another reason that this is great is that I'll find myself with even more shares of Bell when the Astral deal closes. A recent issue with the deal has been a group of competitors, have complained that the deal would result in BCE having too much control on the market which would ultimately mean an increase in consumer costs due to less competition. However it seems like the complaint is more about keeping Bell out of their playground as opposed to the genuine concern for the consumer especially because the Astral deal would give Bell a much larger presence in Quebec where Quebecor Inc. (one of the groups with the complaint) is a dominant player.

There is always the possibility that the deal falls through due to government intervention which in that case my position in Astral would falls dramatically. However, I feel that this is a minor bump in the road and unless a more serious obstacle appears the deal carry on as planned and close in the fourth quarter. When it does, I'll be getting more Bell shares and some cash in exchange for my Astral shares which would further my overall yield and increase my position in one of the big telecoms of the country.

-the Paperboy

Canfor Slashes Dividends...Again

I really should follow my own advice. Yesterday Canfor announced that it will distribute $0.05 in dividends for the quarter. This is an enormous drop from the $0.22 that it was previously distributing This was 2 cuts in consecutive quarters and last time I said that I would be willing to let go of my position is need be. After the announcement, the stock price took a nosedive and now I'm pretty deep in the red for this one. On top of that, this pulls me further away from my goal of $2200 in dividends (which seems very unlikely now that more than half the year is over) and I'm now DRIPing a company that I don't actually want due to my own laziness. Things look grim but I'm not super worried; I know stuff like this happens and will continue to happen throughout my investing career so for now I'm going to sleep on it so I can decide my next move.

Don't get me wrong, I do plan to sell it like I said before, but maybe I'll be able to recuperate some of my losses if I wait for the initial sell-off to finish... or I may be delusional and clearly I should be cutting my losses. However I feel that I should be a little more patient and see what happens in a couple days because selling now is a knee-jerk reaction and from what I read, those are the worse reactions to have.

So Canfor has not only taught me to keep on top of my investments in terms of news of the company, but also to follow-through quickly when I have made a decision; if I sold my position after my post on the first cut, then I would have avoided this mess but instead I held on and now I'm paying the price. This was a very expensive lesson... almost as bad as paying for tuition. Almost.

-the Paperboy

DRIP finally on!

 

After what seems like an eternity, I finally got my first share from a Dividend Re-Investment Program! I received $27.26 in dividends from Sun Life which covered enough for one share. I automatically purchased a share at market value ($22.80) while the difference was added to my TFSA at Questrade. It was a long journey with some bumps in the road but I finally have the compounding machine in motion. Hopefully before long, I'll have DRIPs running for all my positions so that I can accumulate shares quicker.

The plan is once the dividends being distributed becomes a large enough amount, I'll turn off the DRIP and use the money to add to positions at my discretion. This way I'll be able to control what price I'm buying at as opposed to being forced to buy at market value which could be higher than I would like at the time of purchase.

-the Paperboy

DRIPing with Questrade...Again

I've planned to DRIP my positions in Questrade for quite some time now. After a couple of setbacks, I finally have it set up. The form that Questrade provides only allows the registration of 3 positions at a time so instead, I checked off the box that enrolls every eligible position in a DRIP. Now that that is out of the way, I can focus on increasing my positions so that the dividends distributed will be large enough to cover the price of one share. Then the compounding will start picking up and I'll start amassing wealth quicker. Let's just hope that everything is processed without a hiccup this time.

-the Paperboy

Cineplex Raises Dividends

Cineplex recently reported its best first quarter adjusted EBITDA (earnings before interest, tax, depreciation and amortization) result in company history. This was partly due to hit films such as The Hunger Games (which I enjoyed quite a bit) and Dr. Seuss' The Lorax.The Hunger Games had highest grossing first quarter weekend of all time and the third largest opening weekends of all time.

The company declared that it will raise the annual dividends from $1.29 to $1.35. This will be the 2nd increase since converting from an income trust to a corporation in 2011. Cineplex has the majority of the Canadian market and operates theatres under the names Cineplex Odeon, Galaxy, Famous Players, Colossus, Coliseum, SilverCity, Cinema City and Scotiabank Theatres.

Canadian Oil Sands Raises Dividends

At the end of April, Canadian Oil Sands Ltd announced that it will hike its dividends 17% from 30 cents to 35 cents. Sale volumes were low compared to the first quarter of 2011 mainly due to maintenance issues. The company also reported lower and lower net income compared to last year's first quarter.

Here's a quote from Marcel Coutu, President and Chief Executive Officer:

The increase in the dividend to $0.35 per share reflects confidence in our business fundamentals and the commitment to delivering excess cash to our investors," said Marcel Coutu, President and Chief Executive Officer. "Continued strength in oil prices and Syncrude's solid operating base generated strong revenues, resulting in a growing cash balance over the first quarter. Combined with our recent US$700 million debt issuance, we have the liquidity to fund our major capital projects over the next few years while maintaining a strong balance sheet and dividend.
 
From the highlights of the report, it seemed to me like the company wasn't having a good  quarter relative to last year. While increasing dividends is usually a boon for shareholders and I enjoy getting a raise when I sat around and did nothing, I'm bothered by the quote.

Canfor's Complicated Structure & Dividend Woe

Oh Canfor, why do you do this to me? Yesterday, the company announced they will be distributing a dividends of 22 cents (compared to 25 cents in the previous quarter). A little background on Canfor will help grasp a better understanding of the situation.

Canfor Pulp Limited Partnership (CPLP) is what owns two pulp mills and one paper & pulp mill. Canfor Pulp Products Inc. (CPPI) use to own 49.8% of CPLP (CPPI is what currently have a position in). Canadian Forest Products Ltd. (CFP) controlled the remaining 50.2%. Under the terms of the Exchange Agreement made back in January 2011 from all parties involved, CFP exercised its right to essentially exchange its 50.2% interest in CPLP for a 50.2% direct interest in CPPI in early March of this year. This resulted in CFP having a controlling interest in CPPI (with the remaining 49.8% of shares being owned by the old shareholders - like me) while CPPI took 100% control of CPLP. Confused yet? I sure was. Basically this is what happened:

Royal Bank Dividend Increase

At the beginning of the month, Royal Bank decided to increase it's dividends. Canada's largest bank hiked it's quarterly distributions to 57 cents a share which is a 6% increase. This is great because I plan to hold my position in the company for the foreseeable future. Hopefully Royal Bank (along with all my other positions) continue to increase dividend for years to come. Too bad CIBC didn't follow suit this quarter...

-the Paperboy

Canfor Cuts Dividends

I was recently reminded of one of the key points to investing; keep a tab on what you're investing in! Turns out in early February, Canfor cut dividends 38%. The company didn't say why they were cutting dividends specifically, but repeatedly stated weakness in global pulp markets as a reason for its performance. 

Even with the cut I have a high 8% yield. However, my long-term plan is to hold stock of companies that will consistently increase their dividends. This is counterproductive so when an opportunity arises, I may have to let this one go. Luckily for me, I doubled down awhile back and because of that, I can sell my position and even get a nice capital gain from it. If I knew about this sooner (which I should have - no excuses there) then I could have kept an eye out to see where a nice exit point would be.

For now, I'll hold the position. The payout ratio isn't too high and it seems like the debt is covered so I still like the company; it may just be going through a rough patch because of an extended outage at one of the mills and lower pulp prices. I also admire the fact that they aren't afraid to cut dividends when they feel that they need to - rather than attempt to keep up a dividend that isn't affordable and in the end would become detrimental to the company. However, I won't hesitate to pull the trigger because Canfor doesn't seem to fit with my overall plan and I think sticking to that is important so it may be time to part ways.

-the Paperboy

Progressive Waste Solutions Dividend Increase

Yesterday Progressive Waste Solutions announced a 12% increase in dividends distribution. They also posted a solid quarter with a 8.1% increase in revenue (acquisitions contributed 5.6%).  The company also seems like it has a long-term plan and is executing it nicely. Progressive Waste Solutions still has an active acquisition program and intend to be "disciplined" buyers after recently acquiring Waste Service Inc. which has operations in Canada and the Florida. They also plan to invest in internal infrastructure, and continue with the dividends and share buybacks which is great news for me because I essentially got a raise for doing nothing.

The company also redid their goodwill impairment test for their U.S. northeast reporting unit and concluded that due to a weak economic outlook, the carrying amount was overvalued. This resulted in a goodwill impairment of $360 600. This shows that the company is willing to fairly value their assets and not mislead investors. I just did a quick glance over the report and I may be missing something because as of right now, the stock is taking a beating. When I have time I'll comb through it and see what's up, but for now I'm not too worried; I may even take this opportunity to buy more shares if I feel that there isn't a major problem...

-the Paperboy

Corus Dividend Hike

Earlier this week, Corus Entertainment announced that the company will be increasing dividends by 10% this year after announcing a $9.1 million in profit in the first quarter (higher than the $90.7 million from the previous year).  Revenue from the radio division has dropped and advertising revenue is weaker than last year but the specialty channel business more than made up for the decrease. Things should start to pick up once other companies feel comfortable enough to start using a more liberal marketing budget. The hike is not a surprise to me since Corus has been increasing dividends on an annual basis for at least the last 5 years earning it a spot on the Canadian Dividend Aristocrat list (a great starting point for investment ideas by the way). Corus has been distributing dividends since 2003 and hasn't looked back since. I recently increased my position in Corus and I couldn't have done it at a better time. I'll be holding my position for the forseeable future so keep the hikes coming!

-the Paperboy

DRIPing with Questrade

I recently received dividends from my position Sun Life Financial and the amount was high...too high. In fact, the distribution was high enough to cover one share of SLF which means the DRIP that I set up wasn't actually set up. I contacted them through their online chat to see what was going on. Turns out that I wasn't enrolled in the DRIP (this was probably because I filled out two DRIP forms when I went in to their offices; they may have misplaced one). No problem though because the agent enrolled me in the DRIP and even bought a share for me and reimbursed me the commission charge. Great service although it did take awhile before I was connected to an agent.

One thing to note for people who plan to use DRIPs with Questrade is that they buy all the additional shares on the open market and not directly with the company. This means that all the discounts that the companies offer on their DRIPs will not be applied. The discount was a large incentive for me to start DRIPing so I'll have to reevaluate whether or not it's worth it for me. For now I'll just let my SLF DRIP run.

-the Paperboy

Dividends Progress Report: Beginning of the Year

2012 marks the first full calender year that I've become obsessed with personal finance. I started in late May last year and it has quickly become one of my pastimes. Since it's the beginning of the year, I thought it would be nice to see where I'm at in terms of dividends distribution right now and how far along I'll be when next December rolls around. I'll have monthly updates like the budgets to help keep track and hopefully I end up like Scrooge McDuck... the wealthy part... not the duck part.

On track for an annual dividends return of - $1375.35
Total yield of portfolio - 5.36%
Actual dividends received - $0
Expected dividends return if the current positions are held for 1 year - $1375.35

The difference between the first number and the fourth number is that as the year progresses and I add positions to my portfolio, I'll naturally be missing some distributions. The first number will show how much I expect to get at the end of the calender year while the fourth number shows how much I would have got if I had my positions since the beginning of the year. Having the two numbers will show how much of an impact time has on investing. As I collect more data, I'll start plotting a graph to help visualize my progress.

-the Paperboy

Astral Media Increases Dividends

Great news for Astral Media shareholders. The company has decided to hike the dividends by 33%. Along with this, the company announced its plans to buyback stock which will leave less shares outstanding, giving remaining shareholders a larger slice of the pie. Astral Media has 23 television services and is the largest radio company in Canada, with 83 radio stations. They also do outdoor advertisement and you may have seen the logo on billboards and bus shelters around your city. I'm currently long on Astral Media but I feel that I rushed into it and bought it at too high of a price. The increase in dividends makes me feel a little better though and hopefully this is something they'll continue to do because I plan to hold my shares for a long time.

-the Paperboy

How I Plan to Use DRIPs

Last time I talked a little bit about the pros and cons of using DRIPs in your financial plan. Now I would like to talk about how I plan to implement DRIPs to help me achieve my financial goals. Since my main concern with running a DRIP is the fact that I can't choose when to purchase more shares (it's automatically done for me), I decided that I would have some criteria that would have to be met in order for me to DRIP a stock.

Thinking about DRIPing

If you're new to dividend investing, there's no doubt that you'll come across DRIPs when you are doing research. Some people swear by DRIPs while others wouldn't touch them with a 10-foot pole. What exactly are DRIPs and how will you know if they will help you reach your financial goals? Let's take a closer look at Dividend ReInvestment Plans.

Investing 101: Dividends

Let's talk about what to do with all that money that you've worked so hard on saving up. In this section titled Investing 101, I'll go over different terms and ideas that every investor should know.* Hopefully the information provided will help give you a general idea of how things work and build a foundation for you to go and further educate yourself. Welcome to class. Today's topic? Dividends.