Today we have sifted through and picked out Canadian dividend stocks that are considered more conservative on the basis of dividend growth and lower volatility
SmallCapPower | July 25, 2019: Investing in stocks can be risky, yet most investors are risk averse. The term risk-adverse refers to a person who when faced with two investment opportunities with a similar expected return, would always prefer the low-risk option. Dividend stocks can be a risk-averse investor’s best friend, as they provide consistent income that can offset the unsystematic risk associated with individual stocks. Today we have identified four Canadian dividend stocks that could appeal to more risk-averse investors. These stocks have consistently increased their dividend payment over the last four years and have low volatility as measured by the stock’s beta.
*Share prices as at close Tuesday, July 23, 2019, data obtained from S&P Capital IQ
Cargojet Inc. (TSX:CJT) – $93.71
Air Freight and Logistics
Cargojet is Canada’s leading provider of time-sensitive overnight air cargo services and carries over 1,300,000 pounds of cargo each business night. CJT’s air cargo business activities include operation of domestic overnight air cargo co-load network between 14 cities in Canada, as well as provisions of dedicated aircraft to customers. CJT also operates scheduled international routes for various cargo customers between the U.S. and Bermuda, between Canada and Germany, and between Canada, Columbia, and Peru. On June 13, Cargojet announced that is has been awarded the Shipper’s Carrier of Choice Award by Canadian Shipper magazine, a leading industry publication.
- Market Cap: $1.3B
- YTD Return: 32.9%
- 90 Day Average Trading Volume: 40,000
- Dividend Yield: 1.0%
- 5 Year Beta: 0.96
Dollarama Inc. (TSX:DOL) – $48.54
Value Retail
Dollarama is a Canadian value retailer offering a broad assortment of consumable products, general merchandise and seasonal items both in-store and online. The Company has 1,236 retail locations across Canada that provide customers with compelling value in convenient locations, including metropolitan areas, mid-sized cities and small towns. DOL offers consumable and general merchandise by the case online at www.dollarama.com. Dollarama sells merchandise at price points between $1.00 to $4.00. On July 2, 2019, DOL announced that it had acquired a 50.1% interest in Latin American value retailer Dollarcity. As of March 31, 2019, Dollarcity operated 180 stores in El Salvador, Guatemala, and Colombia, with a growth plan to target up to 600 stores by 2029.
- Market Cap: $15.3B
- YTD Return: 49.7%
- 90 Day Average Trading Volume: 810,000
- Dividend Yield: 0.4%
- 5 Year Beta: 0.73
Transcontinental Inc. (TSX:TCL.A) – $14.33
Commercial Printing
Transcontinental engages in the flexible packaging business in Canada, the U.S., Latin America, the United Kingdom, Australia, and New Zealand. The Company puts a heavy focus on corporate responsibility throughout each stage in its value chain. On July 16, Transcontinental released its 2019-2021 Corporate Social Responsibility Plan titled “Acting Together.” The initiatives of Acting Together include moving towards a more balanced gender representation in leadership, optimizing waste management, and investing in Transcontinental’s communities. This follows an announcement from June 4, 2019, when the Company was named eighth out of the Top 10 Corporate Citizens, recognizing the Company’s ethical revenues, gender diversity at senior management and board levels, and a solid record of employee safety.
- Market Cap: $1.3B
- YTD Return: -26.5%
- 90 Day Average Trading Volume: 310,000
- Dividend Yield: 6.1%
- 5 Year Beta: 0.88
Chesswood Group Limited (TSX:CHW) – $9.85
Equipment Finance
Chesswood Group is an equipment finance company focused on financing hard assets for small and medium-sized businesses. Chesswood’s strategy is to acquire financial services businesses that have proven management teams with a market poised for growth. On July 22, Chesswood announced that its subsidiary Pawnee Leasing Corporation closed an $80M funding facility with Sun Life Assurance Company of Canada. Colorado-based Pawnee Leasing Corporation, founded in 1982, finances a highly-diversified portfolio of commercial equipment leases and loans through relationships with over 600 independent brokers in the U.S.
- Market Cap: $160.2M
- YTD Return: -6.7%
- 90 Day Average Trading Volume: 20,000
- Dividend Yield: 8.6%
- 5 Year Beta: 0.88
Disclosure: Neither the author nor his family own shares in any of the companies mentioned above.
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