Category Archives: Canadian Dividend Watch List

Performance Review

Below we compare the performance of the top five stocks in the respective fundamental categories as published on May 20, 2018 covering the period from May 18, 2018 to June 18, 2019 (intraday).

On May 18, 2018, the Toronto Stock Exchange closed at 16,162.30 while on an intraday basis, The TSX currently trades at 16,504.73.  The change in the Toronto Stock Exchange from May 2018 to June 2019 is +2.11%.

Overall, our categories exceeded the TSX by a wide margin which is a testament to the overall methodology that we apply to ranking the stocks.

At the time of our posting on May 20, 2018, we thought that the “low” category stocks would perform the best however, only the low yield stocks came close in the performance ranking.

The consistency of the low yield group to beat the high yield group should change minds when it come to “Dogs of the TSX” investment strategy which espouses buying the high yield stocks in order to beat the Toronto Stock Exchange.  Yes, the high yield stocks did beat the TSX, however, wouldn’t the extra boost of nearly 12x the index be preferred over the 4x gain?

June 2019 Canadian Watch List Continue reading →

Below is the Watch List for September 2018.

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TSX 60 Performance Review

Below is the performance review of the TSX 60 stocks since December 13, 2017:

The TSX 60 is the sixty largest cap stocks in the Toronto Stock Exchange (TSX) index.  It is from this group of stocks that the “Dogs of the TSX” are selected.  The Dogs of the TSX are the 10 highest yielding stocks that are expected to outperform the rest of the index.

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Performance Review

Below is the performance of our Canadian Watch List dated May 14, 2017:

The average change of the entire watch list was –7.48% compared to the Toronto Stock Exchange gain of approximately +4.48% over the same period of time.  Worth noting are the stocks that the analysts got right in the assessment last year.  Those stocks are BCE Inc. (BCE.TO), Cineplex (CGX.TO), and Emera (EMA.TO).

Performance Review

Below is the total return performance of stock that appeared on our Canadian Watch List dated April 23, 2017 with prices adjusted for dividend.

The average return of the entire watch list was –4.90%.  This is contrasted with the Toronto Stock Exchange change of +0.07% over the same period.  The breakdown of the top five stocks in the individual fundamental categories is as follows:

The Canadian list continues to reflect stocks that perform better in the “low” categories as opposed to the stock in the “high” categories.  One point that stands out is that if CGX.TO were omitted from the “low yield” grouping because it appeared in two other “high” categories then the low yield stocks would have averaged +1.34% using four stocks or –0.02% if using the next stock in the ranking (Keyera Corp).

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Performance Review

Below we have provided the performance of the respective categories to show the difference between selecting the stocks that are in either the top 1st, 2nd, and 3rd ranking as opposed to selecting those stocks that are 2nd, 3rd and 4th ranking.

We find the results interesting as there is a material difference in performance.  the largest difference gained was in the high p/e stocks where the selection changed the performance from –17.81% to –3.14%.  Although not a gain, the improvement was substantial.  In fact, all categories gained except the high yield group where the gain was reduced from +11.88% down to +10.23%.

As a group, the entire watch list lost –1.20% on a total return basis as compared to the Toronto Stock Exchange change of +1.32% in the same period of time.  The best performing stock was Jean Coutu Group (PJC-A.TO) which gained +23.96% and was our strong interest stock of February 27, 2017.  The worst performing stock was Cineplex Inc (CGX.TO) which fell –36.33%.

Below is the total return performance of the Canadian Dividend Watch List from February 27, 2017 to February 16, 2018.

At the time, we thought that The Jean Coutu Group (PJC-A.TO) was likely to do better than an investment in REITs.  While PJC-A.TO did generate the highest total return, the REIT stocks did much better than we anticipated. 

Below we have ranked the performance by selecting the top three stocks from the respective fundamental categories.

The Toronto Stock Exchange was relatively unchanged over the last year while the entire watch list averaged +6.10%.

Below is the performance of the January 22, 2017 Canadian Dividend Watch List:

The average gain for the watch list was +6.66% while the gain for the Toronto Stock Exchange over the same period was +4.98%.  When broken down to the respective fundamental categories by only choosing the top three stocks, we get the following returns:

As we said in our December 13, 2017 Dogs of the TSX posting, “Note that all of the low categories performed better while all the high categories performed the worst.  This has been borne out in the few Canadian Dividend Watch List performance reviews that we’ve done so far.”  It appears that anyone buying Canadian stocks using the high yield methodology is underperforming when there are better alternatives.

Below is the January Dividend Watch List along with the our update on the Dogs of the TSX 60, the results are instructive.

Performance Review

Below are the actual returns from our Canadian Dividend Watch List dated September 2016.

The companies are ranked based on their expected performance from worst (on the left) to best (on the right), click on the chart to see how the analysts expected the stocks to perform last year. 

The standout performers from the analyst estimates were Dream Office REIT (D-UN.TO), Cogeco Inc. (CGO.TO), and Boardwalk REIT (BEI.UN.TO).  These stock met or exceeded the analyst estimates.  The stocks that underperformed analyst expectation were Imperial Oil (IMO.TO), Cominar REIT (CUF-UN.TO), and Riocan REIT (REI-UN.TO).

As compared to the Toronto Stock Exchange 1-year return of +4.67%, the watch list from last year gained +6.53%. Below is our watch list and analyst projections.