Quality Dividend Index in June, 2026

 

The off and on opening of the Strait of Hormuz with the current, hopefully resolved Iran-US conflict shows that oil still rules in the world although the electric/battery powered sector continues to slowly grow ... more in some counties than others.

Meanwhile that sparked a want for alternate routes for oil and natural gas from producers and customers around the world to avoid similar future strait blockages trapping shipping and that favours the producers in Canada. Although the price of oil has come down for now, inflation has gone up due to higher transportation costs for goods, passed on to the consumer. That always gets me muttering with political agendas where it hits me in the wallet more in groceries and gas as if they weren't high enough already. Along with that ugly word ... tarrifs.

I read over the "Before the Bell" market news with quick snapshots of what's going on currently although I'm a long term investor. Tech stocks are volatile at times but they rule the S&P 500 for now and that usually turns into collateral damage for other markets at times like the TSX 

When some of my stocks go down due to short term moves, I look at it as a further buying opportunity. Today's headlines ...

Equities     Global markets fell as expectations for imminent interest rate hikes by the U.S. Federal Reserve and debt-backed corporate spending on AI weighed on investor sentiment.     Wall Street futures were in the red after the Nasdaq closed sharply lower yesterday, dragged down by declines in the Megacap technology stocks including SpaceX and Alphabet.     TSX futures followed sentiment lower.

“These are far from dull markets,” said Chris Weston, head of research at Pepperstone Group in Melbourne. “The former generals of the market appear to have lost momentum, and investors are rotating into other areas of the market that are more defensive, less AI-focused and offer more predictable cash flows.”

With "defensive" I'm thinking utilities like Capital Power, CPX.TO. with an ex-dividend date of June 30th, 2026. CPX has been increasing their dividends by about 6% before it's ex-dividend dates in November looking at past years but no guarantee that will occur again this year. Besides data centre builds, the Feds are also talking about nuclear power plants so companies like Capital Power could benefit but that's the government plans for the future. 

CPX has increased in price by about 28% year-to-date and over-valued looking at the Graham Number but I figure investors are factoring in current and future power grid expansions to meet demand.

With pipelines and energy producers, I have South Bow, SOBO.TO and Gibson Energy, GEI.TO on my radar for the last days of June being the 30th and 29th with ex-dividend dates, respectively.  

South Bow is mulling over running a new pipeline into the US given permits for the Keystone project which was halted before when it was part of TC Energy, TRP.TO. losing a substantial investment cost at that time. Now SOBO wants additional assurances from the US before deciding to go ahead sometime in 2027. You burned me once, not twice sort of thing with a wise management.

That gives me confidence they are not rushing into projects although they are green lighted.

Gibson Energy, GEI.TO I've had on my Watchlist for a long time with an attractive yield but with a lengthy research of the company, it has a long history and it's a multi asset business with refinery, railroad, terminals and storage of oil an natural gas along with by products. 

GEI's distributal cashflow currently is running around 90%, where ideal is around 50 to 70% but with expansion and growth comes more debt at times until more revenue kicks in to bring the DCF down.  It's got me interested so I'll probably get involved with a buy.

Earlier this year I was looking for an equity focused growth ETF with decent monthly distribution. I decided on Blackrock's iShares Core MSCI Quality Dividend Index ETF with a Year-to-Date gain of 21%. Impressive after I bought in April. 

I own all the stocks in the current top ten list individually except QSR, Restaurant Brands. Meanwhile XDIV provides additional monthly distributions.

Gordon Pape wrote an article on the Globe and Mail recenty recommending XDIV as a buy on his site.

More information below on XDIV after reading a Morningstar article today among 7 ETFs they ranked by performance.

iShares Core MSCI Canadian Quality Dividend Index ETF

• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★★★

This C$5.5 billion fund has climbed 42.53% over the past 12 months, outperforming the average fund in its category, which rose 29.40%. The BlackRock fund, launched in June 2017, has climbed 26.01% over the past three years and 18.59% over the past five.

Reading about investors and ETFs, it's a personal choice of home country, international, sector based along with income related distributions or growth and adding to that ETF market these days are single stock specific ETFs with enhanced income strategies. Overall, there's a variety of ETFs out there and more being launched while others which are not performing as expected are merged or dropped by providers.

In my portfolio, the end of June into July is mainly Canadian Banks ex-dividend month and I'll be looking at adding to those ETFs which hold the big banks and more. The bank sector is strong and like in a continuous growth bull cycle for now while the stocks are getting expensive although there are partial share options out there now.

  

   

Pipelines and Energy in Focus for June, 2026

 

It's been a comfortable spring with some cool and rain days. With wild fires always a threat this time of year, more rain days are a good thing. 

The recent Big Bank earning reports were no surprise and upbeat. Notable to me was the Bank of Nova Scotia, BNS.TO buying into banks and investment firms in the US. Scotiabank gained over 52% in the last year and increased their dividend by 4% with the next ex-dividend date occurring on July 7th, 2026.

Unusual and unexpected (in a good way) is the higher increase in price of a covered-call Canadian Bank ETF I hold. BMO's ZWB has a current increase of 15% over the last 6 months, 41% in the last year. The distribution cash increased as well but that could change where covered-call ETFs tend to roll with Market ups and downs.

In focus for June is pipelines and energy related with my portfolio highlighted more these days as Canada is looked at as a trustworthy source of oil and natural gas with the Iran/US conflict continuing and the daily news about an on and then off possible resolution.

 A natural gas storage company I've been watching released it's 1st quarter report for 2026 with a majority stake holder being Brookfield and it's trillion dollars worth of assets. The gas goes through high and low demands during a year and during less demand, additional storage of the gas is needed.

Rockpoint Gas Storage, RGSI.TO is based in Alberta but also has storage facilities south of the border with California being the state highlighted. Expansion of  Warwick Gas and Battery Storage projects are ongoing. With investors, Rockwell is buying back stock and has a target of a 3 to 5% dividend increase going forward while increasing it's current dividend by 5% with an ex-dividend date of June 15th, 2026.

Personally, I believe it's an interesting company and provides a needed service for the natural gas producers which use it's storage facilitates. I'll see where it takes me with regards to earnings and income.

With the Globe and Mail, I read the monthly updates and insights from CIBC's Sid Mokhtari, Chief Marketing Technician who has a record of beating the TSX index. No doubt highly paid for his position and results so I take notice.

For June, utilities are more in focus but the pipeline and energy producer, Keyera, KEY.TO is a carryover over from May where he adjusts his portfolio by using his specific metrics.

KEY has been in the headlines making more acquisitions and a recent agreement with CNR to build a railway hub for more accessible transporting of their resources. Where I hold the stock, I'll grow my position there.

I rarely sell a stock unless the comparable price performance in that sector or general market is not performing as expected over time and/or the current dividend payout is in question.

In the second half of June, I'll be looking at more energy and pipeline stocks such as South Bow Corp., SOBO.TO and Gibson Energy, GEI.TO, perhaps a new addition to the portfolio. Capital Power, CPX.TO based in Alberta, is also on my radar in the last of week of June with my ex-dividend calendar.

I got interested in the Morningstar Canada Indexes and the stocks I hold are ranked within as a guide and reference. A great resource to look over for ideas as mentioned below. The higher the Star rating... the more undervalued a stock is within their ranking system with Brookfield Infrastructure Partners, BIPC ranked with 5 stars in their Top Performing Canada Dividend Stocks list for May and a June stock pick by Sid Mokhtari mentioned above but with the ticker BIP.UN  

The Best Dividend Stock Leaders: More Ideas to Consider

Investors who would like to find more top-performing or cheap dividend stocks can do the following:

• Use our Morningstar Stock Screener tool to find the best dividend stocks according to your specific criteria. You can search for stocks based on their dividend yields, valuation measures like price/earnings ratios, and more.
• Review the full list of dividend stocks included in the Morningstar Canada Dividend Yield Focus Index. Those dividend stocks with Morningstar Ratings of 4 or 5 stars are undervalued, according to our metrics.
• When it comes to buying stocks, it’s more than just dividends. Read here how valuations and competitive advantages—known as economic moats—matter when it comes to a stock’s potential for outperformance.
• Read Morningstar’s Guide to Stock Investing to learn how our approach to investing can inform your stock-picking process.