Welcome to October’s edition of money while you sleep. Hope everyone had a fantastic Halloween. Both our kids rocked their costumes and loaded up on the candy. Of course Maria and I had to tax it but at lower rate because we really don’t want all the extra pounds that come with it. Dividends were solid this month and we made a couple portfolio changes, I will get to that shortly.
I like to put a personal touch on these updates so that you viewers see that you can have a life, enjoy each moment and still invest for the future. Some in my opinion spend too much time on the future and not enough on those day to day moments, for me it’s all about balance. So in saying that here is what we have been up to this October.
- We got some annual family photos with Joanne Hobbs Photography definitely not disappointing. If your in the Edmonton and surrounding area and looking for photos check her out!
- Celebrated my Niece Emma’s 4th birthday.
- Kids went back to school and C had his first day of kindergarten.
- Went to the Edmonton Oilers season opener.
- Celebrated Z’s 9th birthday.
- Celebrated my childhood friend Jevon’s 40th birthday.
- Maria got away for a girls/business trip in Canmore.
Portfolio details:
Blue chip companies have continued to outperform our Growth stocks. Now that the world is beginning to open up we should start to see Growth start to perform better. The overall mix hasn’t changed all that much over last month. We did sell off a couple stocks and add the totals to other companies we already own which I will get to in a bit.
Quick trades:
No quick trades in the month.
Please note: I only do this with companies I’m comfortable holding for a long period of time.
Sold:
Full position in Kirkland Lake Gold Inc (KL.TO) @ $56.50/Share
Our why:
Agnico Eagle announced that they would be merging with Kirkland Lake Gold in a partnership that would put them in with the top heavy weights of the sector. Kirkland Lake Gold shareholders will receive 0.7935 of an Agnico Eagle common share for each Kirkland Lake Gold common share held. I felt the deal was not really in favor for Kirkland Lake Gold shareholders as you would be getting less than what the stock was trading at when the news went official. Agnico’s balance sheet is not as good as Kirkland’s IMO. This could be beneficial to both shareholders long term but short term it wasn’t very appealing for me. The good news is we didn’t sell right away and the stock went above $56 and then we unloaded. It is now trading in the $51 area so good timing for once. These were sold at a small profit and we put this money to work elsewhere. Here is a link to the announcement if anyone would like to read up on it.
https://ca.finance.yahoo.com/news/agnico-eagle-kirkland-lake-gold-103000141.html
Full position in Purpose Bitcoin ETF (BTCC.TO) @ $11.30/Share
Our why:
Bitcoin has been on a roll as of late with hitting all-time highs. We took our small position off the table now that the printing press has stopped. We will revisit this sector in the future.
Bought:
Added to our SU.TO position by purchasing 45 shares at $29.22
Who is Suncor Energy:
Suncor Energy Inc. operates as an integrated energy company. The company primarily focuses on developing petroleum resource basins in Canada’s Athabasca oil sands; explores, acquires, develops, produces, transports, refines, and markets crude oil in Canada and internationally; markets petroleum and petrochemical products under the Petro-Canada name primarily in Canada. It operates in Oil Sands; Exploration and Production; Refining and Marketing; and Corporate and Eliminations segments. The Oil Sands segment recovers bitumen from mining and in situ operations, and upgrades it into refinery feedstock and diesel fuel, or blends the bitumen with diluent for direct sale to market. The Exploration and Production segment is involved in offshore operations off the east coast of Canada and in the North Sea; and operating onshore assets in Libya and Syria. The Refining and Marketing segment refines crude oil and intermediate feedstock into various petroleum and petrochemical products; and markets refined petroleum products to retail, commercial, and industrial customers through its other retail sellers. The Corporate and Eliminations segment operates four wind farm operations in Ontario and Western Canada. The company also markets and trades in crude oil, natural gas, byproducts, refined products, and power. The company was formerly known as Suncor Inc. and changed its name to Suncor Energy Inc. in April 1997. Suncor Energy Inc. was founded in 1917 and is headquartered in Calgary, Canada.
Our why:
Last year during the start of the pandemic Suncor slashed the dividend and the stock got crushed. With all the uncertainty at that time they felt it was the right thing to do. With oil prices making 7 year highs and setting up companies in the sector to make crazy cashflow I felt it was time to add to this position and really they have been lagging the industry average. So on October 12th we added really having confidence that the results to follow were going to be really good and there was a potential for an increase to the dividend. Well on October 27th Suncor posted results and also included that they would be doubling the dividend. This was followed by a nice 10% in stock price. This purchase brings in $75.60/year and brings our total to 111 shares which in turn brings in $186.48/year, we are back into DRIP territory. For those interested in the read up of the dividend increase, here it is!
Added to our FTS.TO position by purchasing 34 shares at $55.72
Who is Fortis:
Fortis Inc. operates as an electric and gas utility company in Canada, the United States, and the Caribbean countries. It generates, transmits, and distributes electricity to approximately 433,000 retail customers in southeastern Arizona; and 98,000 retail customers in Arizona’s Mohave and Santa Cruz counties with an aggregate capacity of 3,233 megawatts (MW), including 59 MW of solar capacity. The company also sells wholesale electricity to other entities in the western United States; owns gas-fired and hydroelectric generating capacity totaling 65 MW; and distributes natural gas to approximately 1,048,000 residential, commercial, and industrial customers in British Columbia, Canada. In addition, it owns and operates the electricity distribution system that serves approximately 572,000 customers in southern and central Alberta; owns 4 hydroelectric generating facilities with a combined capacity of 225 MW; and provides operation, maintenance, and management services to five hydroelectric generating facilities. Further, the company distributes electricity in the island portion of Newfoundland and Labrador with an installed generating capacity of 143 MW; and on Prince Edward Island with a generating capacity of 130 MW. Additionally, it provides integrated electric utility service to approximately 67,000 customers in Ontario; approximately 270,000 customers in Newfoundland and Labrador; approximately 31,000 customers on Grand Cayman, Cayman Islands; and approximately 15,000 customers on certain islands in Turks and Caicos. The company also holds long-term contracted generation assets in Belize consisting of 3 hydroelectric generating facilities with a combined capacity of 51 MW; and the Aitken Creek natural gas storage facility. It also owns and operates approximately 91,000 circuit Kilometers (km) of distribution lines; and approximately 49,500 km of natural gas pipelines. Fortis Inc. was founded in 1885 and is headquartered in St. John’s, Canada.
Our why:
It is no secret that were big fans of Fortis and the stock has been flat, really the sector as a whole. We wanted to bring our sector allocation up in utilities and we felt Fortis is the right one to add to. You won’t get massive growth here but if there are any global issues that arise you can be sure they will perform well regardless. They recently increased dividend by 6% and have committed to increase through 2025. For a company that has increased the dividend 48 consecutive years I’m sure they wont disappoint. This purchase will add another $72.76 annually in dividend income.
Dividend increases and decreases
2016 – 2021 Dividends received
We were looking at making a new all-time high however Power Corporation of Canada who usually pays in Oct on the last day of the month moved the official payment to Nov 1. We ended up coming in at $356.73 with 8 shares in DRIP status over 4 companies. If nothing changes we would beat our goal of $3,600 by 10.56%%, 1.5% higher than last month numbers. Those dividend increases coming in are really helping beat our goal. Hopefully banks will be able to increase the dividends before the end of the year to really help jumpstart 2022. Looks like that may just happen, have a read.
https://www.bnnbloomberg.ca/banks-set-to-find-out-if-they-can-hike-dividends-repurchase-shares-1.1675691
Dividends received
| Stock List | Dividend | Drip | Account |
| FRU.TO | $5.85 | No | TFSA 1 |
| EXE.TO | $7.44 | Yes, 1 share | TFSA 1 |
| CSH.UN | $16.42 | Yes, 1 share | TFSA 1 |
| ALA.TO | $5.58 | No | TFSA 1 |
| PLZ.UN | $10.50 | Yes, 2 shares | TFSA 1 |
| NPI.TO | $14.10 | No | TFSA 1 |
| SIS.TO | $5.63 | No | TFSA 1 |
| EIF.TO | $6.84 | No | TFSA 1 |
| CNQ.TO | $37.60 | No | TFSA 1 |
| CM.TO | $61.32 | No | TFSA 2 |
| AQN.TO | $81.18 | Yes, 4 shares | RESP |
| KL.TO | $22.88 | No | TFSA 1 |
| TD.TO | $79.79 | No | RESP |
| Total: | $356.73 | |
Current economy conditions
Canada unemployment rates % have now started to fall which seems obvious due to Canada starting to open for business. As you can see from the chart below we hit unemployment of 7.5% in July which is down slightly from 7.8% in June. August came in at 7.1% followed by a slight decrease in September of 6.9%. Governments are making it pretty clear that Canada will not be going into another lockdown and CERB might be coming to an end so going into Christmas season I would not be shocked to see this continue to driver downwards. October numbers are not in but they expect to see this drop slightly to 6.8%.
Gold Prices
Gold continues to hang around $1,700-$1,800 USD range. With the amount of inflation were starting to see and tapering of printed money it remains to be seen how this plays out. Gold prices almost always have been pretty strong in January so we will see where we end up.
Market
Thanks to a great performance by the banks our sector weighting has risen above 27.5%, although I’m happy with the performance I will not be adding to this sector at this time.
Utilities have not performed all that well this year and with potential increase in interest rates they may be flat for a while but this also gives the opportunity to add as we all know they just pass on the costs to consumers.
More than likely my next purchase or two won’t be in the dividend space and will be looking at adding into the growth list below. Some great name sin there trading at IMO undervalued territory.
Sectors I’m currently looking at
- Technology
- Utilities
- Renewables
Current Dividend watch list (Already own 2 of the 5)
- Fortis
- Quebecor Inc..
- Enbridge
- Brookfield Renewable Partners L.P.
Current Growth watch list (Already own 4 of the 5)
- Nuvei Corporation
- WELL Health
- Good Natured Products
- Bragg Gaming Group
- BRP Inc
Thanks for reading and feel free to leave a comment!
Invest in yourself
Brian
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.
Lots of interesting reading. Have some new money to invest so good to have the guidance
Awesome Barry, thanks for reading!
Brian
Hi Brian, thank you so much for your article.
Just wondering in regards to utilities do you hold Canadian utilities? CU .
I have a small holding but the stock is going no where.
Thanks
Hey Jason,
I do not hold CU. Not a big fan of their lack of growth the past several years. Definitely prefer FTS.
All the best,
Brian
In reply to Jason above, I don’t know if you can access it at the Globe & Mail but John Heinzl wrote an article on CU just the other day. Otherwise, you may want to try your local library. He continues to hold Canadian Utilities, and so do I. I also own shares in four other power utilities though.
I’ll have to read your blog more, Brian.
I haven’t look at it recently so things may have changed. I’ll take a peak as its always nice to add a value pick when its warranted.
All the best!
Brian
Thank you both for your replies and I’ve just finished reading the article in the Globe & Mail so perhaps there’s an upside potential to the company anyways a 5% yield beats any bond yields ourdays.
Thanks again