Welcome to August’s monthly update. It’s been a crazy market these days with the inverted yield curve now giving you less money on a 10 year bond and more on let’s say a 5 year bond. If you follow history this usually leads to a recession within 18 months. Could this time be different? Maybe but unlikely. Trumps trade war continues with China, can’t see this being a good thing for all.
On the other hand we’ve had a pretty busy month, here are a few things we have been up to during the month before I get into what we have been doing.
- C got a big boy bed.
- Z is registered for Dance.
- Maria performed in Notre Dame of Paris at the Fringe.
- Celebrated Nico’s (cousin) birthday.
- Celebrated Grandma’s 95th Birthday!
- Celebrated a friends birthday and even played some pool.
Here are a few pictures
Now let’s get down to business
As you know if you have been following my blog we slightly changed the strategy using about 5% of the portfolio to trade mainly well respected companies, when short term noise has hurt the stock price we purchase these companies and then move on to the next candidate. This month saw the strategy bring in $200 selling a stock that we held for 2 years. This bring’s the 2019 total to $3,542 not including any dividends received.
Sienna Senior Living (SIA.TO)
We held Sienna for 2 years however I really wanted to increase our holdings in banks and insurance. Recently the senior space has slowed slightly, although this is still my favourite sector space. We sold around $19.20 and bought a few years ago at around $17.00. So this was a nice $200 profit not including the other few hundred we received in dividends. This is still on my buy list however I’d like to add it around the $17.00 mark so we will keep an eye on that.
Diversified Royalty Corp (DIV.TO)
Really we just sold off the remaining 24 shares we had. They recently acquired a restaurant and after two years of waiting to see what they would purchase we were not thrilled on the choice they made.
Sleep Country Canada (ZZZ.TO)
We reduced our holding by selling 45 of 154 shares. We took a $100 profit from the sale. Sleep Country has proven themselves that they know how to make money. With the next quarter in my mind to be the best of the year we decided to continue to hold the remaining shares.
Added to our position in Manulife (MFC.TO) by purchasing 50 shares at $22.30.
Who is Manulife?
Manulife Financial Corporation is a Canadian multinational insurance company and financial services provider headquartered in Toronto, Ontario, Canada. The company operates in Canada and Asia as “Manulife” and in the United States primarily through its John Hancock Financial division.
Manulife has proven to be a big player in China by putting up big numbers. China is too big to ignore the potential. Growth in Canada is still growing and they are working on improving their business within the US. The PE ratio is under 8 and the 5 year average is about 15. You can tell some people that held them years back still have a bad taste in there mouth. Manulife is undervalued vs. it’s competitors. With a very nice dividend that they have continued to raise at a 12% average over the past 5 years this one is worth owning.
We added to our position in TD by purchasing 31 shares at a average cost of $71.73.
Who is TD?
TD Canada Trust is the commercial banking operation of the Toronto-Dominion Bank in Canada. TD Canada Trust offers a range of financial services and products to more than 10 million Canadian customers through more than 1,100 branches and 2,600 “Green Machine” ATMs.
What it doesn’t say above is they have a huge market share in the US. TD is my favourite bank of the big 5 and we wanted to add in this sector. Recently the market has been shaky and brought TD down to a more reasonable valuation. TD is a good way to diversify into the US market. Currently the PE ratio of TD is slightly over 10 with an average of 13 over the past 5 years. The dividend growth rate over the past 5 years is almost 10%. This is now our largest holding.
Added to our position in Suncor (SU.TO) by purchasing 27 shares at $37.75.
Who is Suncor?
Suncor Energy is a Canadian integrated energy company based in Calgary, Alberta. It specializes in production of synthetic crude from oil sands. Suncor ranks number 134 in the Forbes Global 2000 list.
Suncor is one of the best managed oil and gas companies. This is my second time adding to my position. I go out to the facility in Edmonton often and have been impressed on how they run business. Current PE ratio is around 10, payout ratio is around 43% and dividend growth rate over the past 5 years is 12.4%. I’d also like to point out Warren Buffett bought a massive amount in Dec/2018. On it’s recent downfall if you were to pick it up like I did you would be paying less than Warren which these days doesn’t happen very often. By adding these shares this finally gets me to able to DRIP.
Dividend increases or decreases
EIF.TO increased the dividend by 10%
CJ.TO increased the dividend by 50%
No decreases this month
2016 – 2017 – 2018 – 2019 Dividends
Dividends received in August were $165.59 which is a 27% increase year over year and this keeps us on track to hitting our 2019 dividend goal..
Dividends received per stock
Over the next few months we will be focusing on adding to companies that have a record of increasing dividends. This may also mean that some that don’t will be dropped from our holdings.
The above statement was made in July and that’s exactly what we started to do in August. Reduced companies that have failed to increase dividends and added companies that have a proven track record.
Any companies that meet the criteria above that you believe are undervalued I’d love to hear it?
Thank you for reading, see you next month and remember:
INVEST IN YOURSELF