With lower payout ratios than some of their peers, the TSX dividend stocks on our list can likely maintain their dividend even in a downturn
SmallCapPower | November 9, 2016: Dividend policy refers to the way in which a company structures its dividend payouts. One of the more important questions that management has to decide is exactly how much they will pay out to its shareholders? How do they set it to minimize the risk of having to cut it in the future? This is always the last thing a business wants to do, as it not only reduces the cash its investors receive, but it also generally creates a large capital loss as the stock price will fall. Thankfully, the TSX dividend stocks on our list today all have payout ratios less than 56%, meaning that their current dividend payout should be safe from the ups and downs of business, but also have attractive dividend yields between 3% and 8%.
Tricon Capital Group Inc. (TSE:TCN) – $8.37
Real Estate Services
Tricon Capital Group Inc. is an asset manager and principal investor focused on the residential real estate industry. The Company operates through five segments. Through Tricon Housing Partners, its land and homebuilding investment vertical, it invests or co-invests in private commingled funds, separate accounts and sidecars. Tricon American Homes, its single-family rental home investment vertical, has an integrated platform responsible for the acquisition, renovation, leasing and property management of singlefamily rental homes. Tricon Lifestyle Communities is focused on acquiring and managing existing three- to four-star manufactured housing communities.
- Market Cap: $942.19(mm)
- Net Income After Taxes (LTM, CAD, Millions): $119.59
- Payout Ratio: 0.27
- Div Yield: 3.4%
High Arctic Energy Services Inc. (TSE:HWO) – $4.61
Oil Related Services and Equipment
High Arctic Energy Services Inc. is a Canada-based company, which focuses on providing contract drilling, completion services, equipment rental and other oilfield services to the oil and gas industry. The Company operates through providing oilfield services to customers in Canada and Papua New Guinea (PNG) segment. In PNG, the product line consists of contract drilling services, workover services and equipment rental including rig mats, cranes and oilfield related equipment. In Canada, the product line consists primarily of snubbing services and the supply of Cryogenic Liquid Nitrogen Pumping Services and equipment rentals.
- Market Cap: $242.61(mm)
- Net Income After Taxes (LTM, CAD, Millions): $32.60
- Payout Ratio: 0.32
- Div Yield: 4.3%
Superior Plus Corp. (TSE:SPB) – $11.81
Oil & Gas Refining and Marketing
Superior Plus Corp. (Superior) is a Canada-based diversified business company that operates through three segments: Energy Services, Specialty Chemicals and Construction Products Distribution. Superior’s Energy Services segment provides distribution, wholesale procurement and related services in relation to propane, heating oil and other refined fuels under Canadian propane division and U.S. refined fuels division. The Specialty Chemicals segment is a supplier of sodium chlorate and technology to the pulp and paper industries, and a regional supplier of potassium and chloralkali products in the United States Midwest. The Construction Products Distribution segment is a distributor of commercial and industrial insulation in North America, and a distributor of specialty construction products to the walls and ceilings industry in Canada.
- Market Cap: $1,686.97(mm)
- Net Income After Taxes (LTM, CAD, Millions): $182.40
- Payout Ratio: 0.56
- Div Yield: 6.1%
Transcontinental Inc. (TSE:TCL.A) – $17.65
Commercial Printing Services
Transcontinental Inc. is a printing company with operations in print, flexible packaging, publishing and digital media, both in Canada and the United States. The Company’s segments include the Printing and Packaging Sector, and the Media Sector. The Printing and Packaging Sector includes the manufacturing activities of the Company, and generates revenues from various activities, such as the printing of retail flyers, magazines, newspapers, color books, personalized and mass marketing products, and the production of flexible packaging solutions in Canada and the United States. The Media Sector generates revenues through print and digital publishing products, in French and English, of various types, such as newspapers, educational books, specialized publications for professionals, retail promotional content, mass and personalized marketing, mobile and interactive applications, and geotargeted door-to-door and digital distribution services.
- Market Cap: $1,364.08(mm)
- Net Income After Taxes (LTM, CAD, Millions): $192.30
- Payout Ratio: 0.29
- Div Yield: 4.0%
Just Energy Group Inc. (TSE:JE) – $6.83
Natural Gas Utilities
Just Energy Group Inc. (Just Energy) is an energy management solutions provider engaged in electricity, natural gas, solar and green energy. The Company’s segments include Consumer Energy and Commercial Energy. The Company operates in the United States, Canada and the United Kingdom, offering a range of energy products, including long-term fixed-price, variable rate and flat bill programs; home energy management services, including smart thermostats and tools to manage energy use at the appliance level, and residential solar panel installations. It markets under the brands, such as Just Energy, Hudson Energy, Amigo Energy, GreenStar Energy, Just Solar, Tara Energy and TerraPass.
- Market Cap: $1,005.35(mm)
- Net Income After Taxes (LTM, CAD, Millions): $4,071.25
- Payout Ratio: 0.17
- Div Yield: 7.3%