If you are retired, whether you have a defined benefit pension or are living on income derived from your own investments, you may be interested in meeting with a few friends to discuss world events and what is driving the world economy. Our discussions can also offer insight into our own personal investments. If that catches your attention, come and join friends at the Probus Investment Club. We meet on the second Tuesday of every month at 2:00 pm via Zoom until we can meet again in person. Our next meeting will be on June 14th. New members are always welcome.
At our last meeting on May 10th, we reviewed dividend paying stocks. Robert shared an article from the Globe and Mail and Tim took us through a presentation of dividend paying stocks from Simply Wall Street that are paying dividends of 5% or higher. He also included further investigation through Yahoo Finance, the Globe and Mail and business news.
One of the differences between the list produced by Globe and Mail and the one generated from Simply Wall Street is the Financial Health of the companies. Note that Financial Health is defined by the following criteria:
- Short Term Liabilities – are they covered by short-term assets?
- Long Term Liabilities – are they covered by long-term assets?
- Debt Level – is the net debt to equity ratio high?
- Reducing Debt – is the company reducing this?
- Debt Coverage – is this covered by operating cash flow?
- Interest Coverage – are interest payments on its debt are well covered by EBIT?
We were not able to cover all nine stocks due to time restrictions but we did review six with the following results:
1) Manulife – We hold this stock in our portfolio. It shows growth of dividends as well.
2) Power Corporation – We agreed to investigate further. An international management company throughout North America and Asia. Dividend 5.43%. It shows growth of dividends. Positive review. Discussion ensued on size of Demarais family holdings. This has been followed up by an article from the CPA magazine shared with the group by Sharon.
3) IGM Financial – subsidiary of Power Corporation – Wealth Management Company – Dividend 6.17%. Not a dividend grower. High competition. Decision No interest.
4) AGF Financial – Publicly owned Management Company – Dividend 5.9%. Underperformed over last 10 years. Profit lower than last year. Decision – no interest.
5) Dexterra Group – Small cap company. Dividend 5.11%. 87% of earnings being paid out. 74% under fair market value. Decision – no interest
6) Pizza Pizza Royalty – Small cap company. Distribution: It was previously an income fund, now a regular stock trading company. Revenue forecast +70.11% over next year. Cash payout 101%. Buying opportunity? Continue to watch.
We discussed Shopify which is in our portfolio. Decision Hold.
Kirkland Lake Gold merged with Agnico Eagle Mines Ltd on February 9, 2022. The Agnico price was $62.65 on that date. Their dividend is 2.96%. Each Kirkland shareholder was entitled to receive 0.7935 share per share. This works out to $49.71 which is what our April statement shows for Kirkland. The share change and price will be shown in our next portfolio statement.
In view of the volatility of the market and the uncertainty in world events, we decided that we would meet again on Tuesday, June 14, 2022 via Zoom in order to review our portfolio and continue Tim’s presentation.
If you are interested in joining the Investment Club, please contact Linda Hasler lhasler@rogers.com or David Snow snow@sympatico.ca who will ensure that you receive an invitation.
Probus Club of Kingsway-Islington 