Money While You Sleep 2019 January Edition

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Welcome to my first 2019 edition of money while you sleep. Before we get started with the portfolio this is what we have been up to while the dividends continue to roll in. 

Here are a few things we have been up to:

• Went back to work Booooooooo
• Z went back to school
• Completed my reading of the Intelligent Investor
• Spent most weekends bringing the kids skating, swimming and other activities
• Celebrated my step dad’s birthday
• Maria attended Tony Robbins
• Attended year end work party at the Comic Strip

Here’s a few picture’s

Step dad’s birthday

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Wife and I after the year end party

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Maria with her business teammates

Late Christmas dinner put on by my Sister as she was away during the holiday

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Now lets get down to business

Portfolio details:

Well after reading the Intelligent Investor it has really changed how I think of buying and selling stocks. I find myself using 5% of my cash to make plays on stocks that I’m comfortable holding however selling out when the stock moves 5-10%. The criteria is to purchase either companies that had an over sell or extremely undervalued companies. Again I still am focusing on my portfolio as a whole and holding 95% positions long term however what I’ve learned is it’s important to take gains when stocks price is out performing what the company is actually doing. So I tried this strategy and was able to bring in an additional $1055.17 in January alone only using $5000. The stocks that I traded in and out of this past month were: BTH, N, TGOD, CLIQ, EIF and NFI.

Sold

Sold my full position in CLIQ (Alcanna) of 475 shares @4.70

These shares were purchased last month after Alcanna eliminated their dividend fully. I saw a huge over sell take place and once that trend finished I made my position. Alcanna is set to announce their next results in early February, I felt it was best to sell as the plan was never to hold them for very long. I’m happy with a 15% profit just for holding them for one months time. Regardless if their financial results are good or bad it doesn’t matter and its time to move on.

Sold my full position in CPG of 53 shares @ $4.40

CPG announced that they would be reducing their dividend 75%. This was one of my first purchases a couple years back and one of my worst decisions. Knowing what to look for now in a company I know there’s a good chance I won’t make a mistake like this one again. The good news is I didn’t make a huge investment in them so that helps with the pain of selling a stock at a loss.

Sold my full position in NVU.UN of 80 shares @ $26.15 and 127 @ $26.88

This has been a great performing hold for me for quite some time however its trading close to it’s 52 week high and from a technical perspective I would like to repurchase below $26. If and when that happens I can then decide to use the capital gains received and buy additional shares above the 207 shares I originally had (200 purchased and 7 DRIP’s) at no additional cost or buy back the 207 shares and reinvest difference for future purchases. Either way I received plenty of dividends along the way and capital gains from the sell so if the stock goes higher well you can’t win them all.

Purchased

Added to my position in Manulife with the purchase of 50 shares @ $21.08

Who MFC is:

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.

My why:

Since my trading days only goes back a few years I never went through the pain of MFC many years back. I purchased them for a few reasons, they have great assets, I believe there is still more growth to come out of China for them regardless of what the news tells us, they continue to increase their dividend each year by 10% or more, Recently had a lawsuit scare from something that happened like 15-20 years ago that really hurt the stock value which regardless of  outcome is already factored into the price. In my mind based on  quarterly revenues MFC should be trading closer to $30 a share.

I purchased 70 shares of Northland Power Inc. (NPI) at an average price of $23.60/share

Who NPI is:

Northland Power is an independent power producer founded in 1987, and publicly traded since 1997. Northland develops, finances, builds, owns and operates power generation facilities in Canada and internationally that produce energy using wind, natural gas, biomass, and solar technology.

My why: Renewable energy is the future. They have many different ways of  producing energy and have diversified themselves globally. $23.60 a  share is fairly valued here however the potential growth over the next year is about 15.5%. PE ratio is just over 15 currently and revenue is  consistent. Debt has been coming down since September and interest rates increases look like they are going to pause for a while which is good for them. I’m happy to collect a nice monthly dividend as well with a good chance of increase this year. If the stock gets to  around $25 i will reassess based on earnings and future outlook. This will increase dividends received by $7.00/month.

I purchased 120 shares of Exchange  Income Corporation @ $28.58 (I had sold 55 shares earlier in the month  at  $29.02)

Who EIF is:

Exchange Income Corp is Canadian diversified acquisition-oriented corporation focused on opportunities in two sectors, aviation services and equipment, and manufacturing. In particular, the company is focused on businesses that are suited for public markets, except, in certain circumstances, for their size. The business plan of the Corporation is to invest in profitable, well-established companies with strong cash flows operating in niche markets. The Aviation segment recognizes revenue on the provision of flight, flight ancillary services, and the sale or lease of aircraft and aftermarket parts. The Manufacturing segment recognizes revenue on the sales of manufacturing products and services.

My why:

EIF is very well diversified with multiple companies under their umbrella such as: Perimeter,Keewatin Air, Jasper Tank, Overlanders Manufacturing, Stainless, Water Blast, Calm Air, Bearskin, Westower Canada, Custom Helicopters, Regional One, Provincial Aerospace, Ben Machine Products, Quest Window Systems,Moncton Flight College and a couple being finalized within the past few weeks. EIF has also increased their dividend for 14 consecutive years, yes please! They carry a PE ratio of 13.3 which is below it’s 5 year average of 29, to me this a healthy entry point. With the recent pullback in the market and the 8% yield this is a place i’d like to be. This will add over $20/month to dividend income. I will closely monitor this one as their debt level is high but revenues have been great!  Unchanged interest rates will benefit them short term.

We added to our current position in Chartwell Retirement Residences by purchasing 88 shares at $13.98 

Who is Chartwell Retirement Residences:

Chartwell Retirement Residences is an unincorporated, open-ended trust. The Company indirectly owns, manages and operates a range of seniors housing communities from independent living through assisted living to long term care. Its segments include Canadian Retirement Operations and Canadian Long Term Care Operations. It owns and operates senior residences in Canada. Its portfolio of residences includes independent living residences for seniors that include retirement units/townhouses/bungalows providing meals and general services; independent supported living residences for seniors that include retirement units/townhouses/bungalows with household general services; assisted living residences for seniors requiring personal care services; memory care units for seniors having Alzheimer’s or other form of dementia and requiring personal care services, and Long term care residences for people requiring professional nursing care on a daily basis and over 24-hour supervision.

My why:

I really like this space for many reasons. In 2011 those that were born in the baby boomer era started to retire (65). The baby boomer era are those who were born between 1946-1964 meaning more retirement homes and care centers will be required for many years to come. This means potential for new facilities, ongoing increased revenues and dividends, dividends, dividends. Eventually we will get into a market crash and this is the type of company I want to own. This is a very well managed company. From a trend perspective this stock over the past 2 years trades in a range of $13.43-$16.25. After another correction in the market in December the decision was made to pull the trigger at $13.98. This will increase our annual dividend amount from Chartwell from $121.32 to $179.93 with yield at time of purchase was around 4.25%. This is a full position and also finally DRIP’s 1 share per month as long as the price holds under  $14.99.  If the price goes above its 52 week high we will enjoy holding if  it tests and falls we may move out for a bit. Only time will tell but at $13.98 I’m happy to buy. 

We opened our first position in TD Bank with a purchase of 25 shares at $70.25

Who is TD:

The Toronto–Dominion Bank is a Canadian multinational banking and financial services corporation headquartered in Toronto, Ontario.

My Why:

I personally believe TD is the best bank in Canada. They have lots of exposure in the US which I like at this current time. TD has done a great job and increasing their dividend each year with a 5 year average increase of 9.2%. TD has been hit hard with the market as we all saw the market get ahead of itself. It has come back to a great level to make a first investment. At the time of purchase the yield was about 4%.
Dividends received per quarter will be about $16.75.

Opened a position in Sleep Country Canada with a purchase of 75 shares @ $20.90/share

Who is Sleep Country Canada:

Sleep Country Canada Holdings Inc. is a Canadian mattress retailer, with over 260 stores operating in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island and Nova Scotia. The company was ranked one of the top 50 companies to work for in Canada by the Globe and Mail.

My why:

This stock got hammered last year after it got ahead of itself. Based on forward earnings this stock should be trading between $30-$40. They recently acquired Endy for around 88 million which in my mind was a smart play. Endy is an online entity which has performed very well and was famous for selling the bed in a box. Endy will still run individually however this also gives Sleep country the right to sell it. I’m sure there will be synergies cost wise that they can take advantage of such as selling pillows and other accessories as well as possibly cutting down on indirect costs. Since going public they have increased the dividend quite nicely year over year and are still in a strong position to increase it if they so choose. Current dividend is around 3.75% with a low payout ratio of around 45% and don’t carry much debt. Happy to hold this one as they are the leader in the industry when it comes to mattresses. Dividends received will be around $14.00 per quarter starting in February.

Dividend increases as well as any dividend cuts

January

No dividend increases in January

No dividend cuts this month

2016 – 2017 – 2018 – 2019 Dividends

Dividends received in January were $118.42. Which is an increase from January 2018 of 23%. As we restructure were hoping to have the same  type if not a better trend line for the year of 2019 however as we will be taking gains where  necessary the portfolio may look a bit different as the year goes on. 

Dividends received per stock and if they’re set up within the DRIP program

Stock List	January	DRIP
CSH.UN	$10.83	NO
CJ.TO	$2.61	YES
NVU.UN	$27.97	YES
PLZ.UN	$8.87	YES
ARX.TO	$8.60	NO
ALA.TO	$5.36	NO
CPG.TO	$1.59	NO
ENB	$12.08	NO
EXE.TO	$6.88	NO
FRU.TO	$5.99	NO
GH.TO	$5.18	NO
SIA.TO	$8.80	NO
SPB.TO	$8.22	NO
REBATES	$0	N/A
DIV.TO	$0.44	NO
EIF.TO	$10.04	NO
CHW.TO	$7.00	NO
XTC.TO
POW.TO
C
Total	$118.42	N/A

Not sure on current watch list as I’m working on a new list with a  different outlook on what I’d like to add.

Currently sitting on 10% cash of portfolio for the right purchase.

What are you currently watching? Are you buying or hoarding cash and why?

Please feel free to leave a comment and be sure to sign up for my blog via email to stay up to date with each post!

See you all next month and remember…………………………

Invest in yourself

Brian