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BEST DIVIDEND STOCKS
a Dividend Detective
Premium feature
Canada Corps: Excluding Energy
This portfolio contains Canadian corporations
that are not involved in energy exploration and production. We maintain a
separate portfolio
for Canadian E&P corporations.
Tax Considerations
If you're a U.S. citizen, Canada dividend payers withhold 15% of your
dividends for Canadian Taxes. However, you can apply for
to the U.S. IRS for a
refund (foreign tax credit) for at least a portion of the amount withheld. For U.S. Dollar vs.
Canadian Dollar currency exchange rates,
click here.
Currency Exchange Rates
As of April 30, the Canadian Dollar was worth $1.06 U.S. dollars, up 3%
from March 31, and up 5% since December 31, 2010.
Thus, for Canadian stocks, so
far this year, currency exchange rates have increased U.S.-based investors'
returns by 5%.
Recent News
(since 5/3)
5/18: Liquor stores reported March
quarter operating cash flow of $0.15 per share, up 67% vs. year-ago. Revenues
were even with year-ago at $116.0
million. The gross margin was 25.1% of sales vs. year-ago 24.3%.
5/13: Morneau Shepell reported March
quarter earnings of $0.13 per share. Operating cash flow rose 33% vs.
year-ago to $16.2 million ($0.33/share). Revenues rose 5% to $85.4
million.
Overview
(5/3/11)
Our portfolio broke even, on average, in April. Morneau Sobeco returned
3%, but both Genivar and Liquor Stores dropped around 2%.
None of our picks announced significant news during the month.
New Picks
This month we're adding two new picks to the portfolio.
Canfor Pulp Products, which converted from an Income Fund to a
corporation on January 1, holds a 49.8% interest
in Canfor Pulp Partnership, which produces
pulp and Kraft paper products at three mills located in British Columbia.
Canfor is the largest North American and third largest global producer of
pulp and Kraft papers. Pulp producers are enjoying strong and growing
demand from China, which will likely drive both volumes and prices higher.
Canfor is currently paying a 9.0% dividend yield and we expect around 10%
dividend growth over the next 12 months.
Vicwest, which also converted from an Income
Fund to a corporation on January 1, directly owns and operates steel
fabrication and distribution businesses.
Vicwest manufactures and distributes steel construction products such as
roofing and siding, and also fabricates metal structures for storing
grains, fertilizers and liquid products. Vicwest pays dividends equating
to a 6.8% yield.
Sell Genivar
We're advising selling construction consultant Genivar, which pays a 4.8%
yield, so that we can focus on higher yielding stocks.
Corporate Conversions
All of our picks converted to corporations on
January 1. As part of the conversion, Morneau Sobeco changed its name to
"Morneau Shepell, Inc." Here's how the conversions affected dividends.
Genivar changed from monthly to
quarterly dividends, but its $0.375 quarterly payout equates to the same
annual rate ($1.50) as before. Liquor Stores cut its monthly dividend by
33% to $0.09 per share. Morneau Shepell cut its monthly
dividend by 17% to $0.065/share.
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