Mid January, 2024 and the Undervalued

 

It's mid January, 2024 already and most investors are wondering what lies ahead for this year with probably a sense of optimism about the speculation of interest rates that affect companies and banks, coming down at some point this year.

I tend to label the months when ex-dividends occur with stocks in my portfolio and watchlist, with this month being Canadian Banks on my list to further buy. BNS and TD were in the first half of January and ahead is the popular Royal Bank (RY) plus Bank of Montreal (BMO), which recently announced a dividend increase. 

Reading the news about the Banks, the millions of dollars they have had to put aside to cover credit losses like mortgage defaults, continues to bother many an investor and that will play out for some time to come. This year and into next as mortgage renewal dates happen. 

I'm a fan of the "undervalued" stock (Graham Number) and a history of increasing dividends which brings on compounding over time. Currently, BNS, TD and BMO are undervalued with room to grow in price while RY is about at par. 

                                                 Courtesy of Yahoo Finance                                                                     

Looking over some popular Canadian equity ETFs with high yields, TD and RY tend to rank high in weighting or in the top ten holdings by the managers. For example, Vanguard's VDY and Blackrock's XEI both have low management fees and hold top companies with decent yields, paid out monthly.

The 31st of January is the ex-dividend date for one of my core utility holdings; Emera (EMA) with a current yield of 5.61%.

Since I'm into cash dividends, I'll end this post from Henry of Your Ever Growing Income showing examples of income/dividend growth over time.

As always, there's lots of informative reading on the Blog list on the right sidebar.

Happy New Year and the BTSX 2024

 

Happy New Year and best wishes for good health, family and finances.

To start off 2024, I had a look at this year's new BTSX, or Beat the TSX portfolio and strategy ... with it's list of 10 stocks.  Matt of Dividend Strategy, posted his first 2024 article about the past and looking forward plus how he "works" the BTSX strategy. Similar to me where I hold stocks on the list from the past and may end up on there again in future years. 

In the long term it does beat the TSX index, while there are years it falls short like 2023 but still a gain of 7.77% with dividends compared to the TSX benchmark of 11.31% considering 2023 was a flat year until October when the Bank of Canada put a hold on interest rates and speculation they may come down this year.

On my end, the only stock I don't hold in the BTSX portfolio is AQN, Algonquin Power although it started a turn around last October after the smoke cleared about it's past dividend cut.

Going forward, I'll concentrate on the undervalued stocks with a growing dividend in the BTSX and others I pick out of model portfolios that have a good record after checking the current stats, history and news.

                                                   Courtesy of the Financial Post

Strategies are everywhere online and in hundreds of investing focused books but I find it works to commit to a "do it yourself plan" for the long term with top listed dividend stocks and add from there.

Picking out of the top 20 stocks in the TSX 60 by dividend yield is a good place to start in my opinion.

With more on the BTSX, the always informative, Cut the Crap Investing by Dale.