Welcome to the July edition of Money While You Sleep. During the month we added to a couple companies, some dividend growers and some growth stocks that are on the rise.
Here are a few highlights as we continue to get back to a normal society
- Went camping for a few days.
- Boat rides and beaches.
- Maria and I celebrated our 9 year anniversary.
- More golfing.
This month the market continued its gains as we saw the TSX go from $15,512 to $16,169. We started to dip our feet in a few companies but are still around 12% cash ready to be deployed. Company purchased but not mentioned below DND.TO (Dye & Durham Corporation)
We added to POW.TO (Power Corporation of Canada) by purchasing 50 shares @ 24.48
Who is POW.TO:
Power Corporation of Canada operates as an international management and holding company with interests in the financial services, sustainable and renewable energy, asset management, and other business sectors in North America, Europe, and Asia. The company operates through Lifeco, IGM Financial, and Pargesa segments. It offers life, disability and critical illness, and reinsurance products; annuities, securities, and mortgage products; retirement and estate planning; and investment, protection, and wealth management services. The company also manages and distributes mutual funds; and offers investment products, including equity, fixed income, and absolute return and alternative strategies, as well as investment advisory and related services. In addition, it generates renewable energy through solar and wind facilities; manufactures specification-grade LED lighting solutions and zero-emission vehicles; and operates equity investment funds. Further, it holds interests in various businesses, such as mineral-based specialty solutions for industry; testing, inspection, and certification; cement, aggregates, and concrete; wines and spirits; sportswear design and distribution; materials technology and recycling of precious metals; disposable hygiene products; and regional leisure parks, as well as in oil and gas, chemical, and food and beverage sectors. The company was founded in 1925 and is headquartered in MontrÃ©al, Canada. Power Corporation of Canada operates as a subsidiary of Pansolo Holding Inc.
Well it goes back to December of 2019 when the company announced the Desmarais brothers were retiring and they put R. Jeffrey Orr as both President and CEO of the company. This gives new eyes to a company that has unperformed over the past 10 years. Already good things are happening as they have amalgamated Great-West Life, London Life and Canada Life into a single company which now goes under Canada Life. Working in the corporate world this tells me there will be plenty of synergies to come from this. They also own more than 85% of WealthSimple which has shown great growth recently. As of March 31 they had over 350,000 clients and 6.8 billion under management. Over the past few months I’m sure it’s a heck of a lot more with the amount of interest in trading platforms seeking low fees. They have a solid portfolio and diversified with business in Canada, USA and Europe. They currently pay a yield of around 7.5% annually, carry a PE ratio of 10.52 and a P/B currently at 0.81. The purchase brings us to 141 total shares and brings annual dividends to $252.39
We added to our position in DOC.V (CloudMD Software & Services Inc) by purchasing 2000 shares at an average price of $0.59
Who is DOC.V:
CloudMD is part of CloudMD Software & Services Inc.. The company offers SAAS based health technology solutions to medical clinics across Canada and has developed proprietary technology to deliver quality healthcare through the combination of connected primary care clinics, telemedicine, and artificial intelligence (AI).
We have been looking for potential growth positions for quite some time. We have plenty of solid blue chip companies however we have been very light on future technology. Cloud MD fits the bill. As we know the world is changing and so is how we see our Doctor. Ever have to wait in doctor’s office for a few hours? Ever have to wait days for a non emergency visit? CloudMD offers a comprehensive virtual care solution that helps more people access high-quality care when they need it. They currently have a combined ecosystem of 315 clinics, over 3000 licensed practitioners and almost 3 million registered patients. CloudMD has developed tailored solutions to digitize the healthcare experience connecting doctors, allied health professionals and patients.
They have developed an innovative healthcare application that enables and supports physicians in the longitudinal care of their patients’ health. Their patient centric focus places the power back in the hands of patients via a personalized health record that stores, manages and enables sharing of health information. Their patients will have increased access to their charts, lab results, the ability to securely chat with clinical staff, reorder prescriptions and share remote health monitoring data with their doctor – all at their fingertips.
How cool is that? They have be acquiring companies like crazy to continue the vision that they have implemented. With Covid19 currently making appointments difficult this gives a company like CloudMD the opportunity to blossom into the future.
We added to our position in PIF.TO (Polaris Infrastructure Inc) by purchasing 80 shares @ $14.00 (2/4 position)
Who is PIF.TO:
Polaris Infrastructure Inc., a renewable energy company, acquires, explores, develops, and operates renewable energy projects in Latin America. The company, through its subsidiaries, owns and operates the San Jacinto project, a 72 megawatt (MW) net capacity geothermal facility located in northwest Nicaragua. It also operates three run-of-river (ROR) hydroelectric facilities, which include Canchayllo facility with an approximate 5 MW net capacity located in the Canchayllo district, Peru; El Carmen facility with an approximate 8 MW net capacity located in Maravillas, Peru; and 8 de Agosto facility with an approximate 20 MW net capacity located in Aucantagua, Peru. The company was formerly known as Ram Power, Corp. and changed its name to Polaris Infrastructure Inc. in May 2015. Polaris Infrastructure Inc. was incorporated in 1984 and is based in Toronto, Canada.
We decided to add into PIF.TO as we continue to like the renewable energy sector. In the sector we have had a hard time finding a company that isn’t trading at a high evaluation. Polaris meets that criteria. Polaris knocked it out of the park in the 4th quarter with an earnings per share of $0.83 vs the street expectation of $0.21, They followed that up meeting earning expectations with an earnings per share of $0.27 in the first quarter, they are expected to have an earnings growth in the second quarter of approx 156%, they have a current 5 year peg ratio of 0.14 and a dividend of 5.78% with a payout ratio of 63.16%. This company is more than just a dividend company, they have the growth piece as well which is hard to find these days. As the Energy industry shifts to renewable energy I’m happy to hold Polaris. This purchase now adds an annual dividend of $96 based on 160 shares.
Dividend increases and decreases
- No Raises
- No Cuts
Were very happy with a no decrease July and for the second month in a row
2016 – 2017 – 2018 – 2019 – 2020 Dividends and Rebates received
July was a huge month with $282.48 of dividends coming in. This was an increase vs. last July of 88%. Our next big month will be September and should keep us in line with our goal of $3,100 in annual dividends.
Dividends received in TFSA 1
Dividends received in TFSA 2
Dividends received in RESP
My thoughts moving forward
Current economy conditions
Unemployment rates are starting to improve by going from 13.7% in June to 12.3% in July but not at the same rate these jobs disappeared back in March. It seems the fed will do whatever they need to do to ensure the economy returns to better days. In July they announced an extension to the CERB payments to 6 months. They are trying to print their way out of this and it’s hard to tell if it’s going to work. If they chose not to turn on the printing press we would be in some very dark days as a global economy. We have started to see 2nd quarter results come out and although some companies have been hammered the market for the most part already factored this in. Air Canada is a prime example. Their results were terrible posting a 1.7 billion dollar loss in the quarter and yet the price of the stock is back to where it was the day before they announced.
Careful where you put your money
It is so important especially right now that you do your homework before you buy. This isn’t the type of market to be a blind folder investor (Not that you should ever be one) because you can be burned very easily. Personally you won’t find me buying something like AC due to the amount of unknowns in the future. Will they go bankrupt? Will business travel ever be the same? When with Covid improve enough that people are comfortable traveling there? When will the 14 day quarantine be a thing of the past? Only time will tell what happens with AC but I would say they have a higher probability of going broke than going back to pre covid numbers. You work hard for your money so put it in places that you can see a strong future.
Sectors I like
Some sectors are having to think differently as Covid19 has shown that business cannot run the same way as it did at the beginning of the year. Take Doctors for example, they are finding it difficult to be able to see patients and have relied heavily on cloud based technology to be able to change that. Your seeing the telemedicine technology start to speed up. Look at Telus for example: Most don’t know that Telus is in this market and for good reason. Sectors i currently like are Financials, Communications, Healthcare and utilities.
What to look for
Check those balance sheets as they are changing quite quickly. Do you see liabilities moving from short term debt to long term debt? How much cash do they have? Do they have more assets than liabilities?
Does the company have any catalysts that could provide growth in the future? How did the company manage in the last recession? Do they pay a dividend? Do they continue to increase dividends over time? Have they cut the dividend before and how often? What is their current payout ratio? Is the company raising cash just to pay those dividends? Dilution is not always the solution!
Current companies I’m watching. I own some of these but don’t have a full position that’s why they are still on the list
PIF.TO, ARE.TO, TD.TO, RY.TO, EQB.TO, MFC.TO, SLF.TO, NWH.UN.TO, FTS.TO,CPX.TO, AQN.TO, T.TO, ENB.TO, NFI.TO,BCE.TO, POW.TO, MIC.TO,DOC.V, DND.TO
As Warren Buffet would say:
“THE STOCK MARKET IS A DEVICE FOR TRANSFERRING MONEY FROM THE IMPATIENT TO THE PATIENT “
Invest in yourself
Disclosure: I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. Please ensure you do your own research.
6 thoughts on “Money While You Sleep 2020 July Edition”
Nicely done! $282.48 in dividend income is HUGE! Congrats on a great month and looks like you guys had a fun time boating around.
Thank you. Starting to see the growth now. It was really nice to get out on the water. Kids had a blast! All the best to you and thanks for reading
You really are amazing! I guess I invested in the right thing!
Thank you 🙂 Try to improve daily
Good stuff again Brian. I always appreciate your vision and the portfolio is solid. I especially congratulate you on picking up PIF at $14. I’ve like them for 2 yrs now and they continue to impress while growing assets and revenue in a difficult environment. Also, your boat handling skills are admirable, allowing your daughter to take Maria’s pic. Loads o’fun! Cheers buddy.
Thanks Bob. It people like you that inspire me to keep going day in and day out.
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