The Ultimate Canadian Dividend Stock Portfolio
It’s the dream for income investors and retirees…
Getting in on a stock before everyone else.
By the time you hear about a hot stock in the news, it’s too late.
Early investors drive up the stock price. And you miss a huge opportunity.
That’s no way to invest.
Especially for retirees and others living on a fixed income.
You need to get in before the herd. And at Wealthy Retirement, we know this.
So we scanned the market for the best Canadian dividend payers.
While everyone else is looking at U.S. companies, we’re looking north.
This way, you can outperform other U.S. investors. Also, Canadian stocks help diversify your portfolio. And they can help hedge against U.S. inflation.
In the end, we hand-selected four Canadian dividend stocks.
We created a high-value portfolio with a fat 5.75% yield.
Plus, we’ve included a BONUS stock with potential for enormous growth.
We will reveal this top-secret portfolio in a moment. But first, we need to cover the most powerful wealth-building force in the universe…
The Power of Compounding
We’ve seen compounding referred to as “the most powerful force in the universe,” “the royal road to riches” and “the greatest mathematical discovery in human history.”
Albert Einstein called it the “eighth wonder of the world.”
Compounding is a simple investment strategy in which you put your money in an investment that pays a return. At the end of the year, you take your return and reinvest it with your original stake. Your dividend, or interest, earns a return too, building a bigger dividend – or higher interest payments – the next year.
A snowball is the best analogy for compounding. As you roll the ball through the snow, the surface area gets bigger. The more surface area on the snowball, the more snow it picks up. The snowball gains mass slowly at first… but pretty soon, it’s so large you can’t move it.
Compounding is slow and boring at first. But gradually, the dividends grow and your reinvestments increase. One day, you wake up to find your account producing thousands of dollars per year in dividends and your wealth a giant snowball.
Here’s a mind-blowing example from a study conducted by Richard Russell of Dow Theory Letters on the power of compounding…
An 18-year-old girl puts $2,000 into an account each year from age 19 to 25, then stops contributing and lets it compound at a rate of 10% until age 65. That means she has contributed only $14,000 in total. But because of compounding, by age 65, she’s almost a millionaire, with $944,641 in her account.
Now, let’s say this girl has a twin brother. He’s not as disciplined and continues to blow his money on useless things. Finally, at age 26, he realizes he needs to start saving too.
He puts $2,000 per year into his account starting at age 26. He also lets his money compound at a rate of 10% until age 65. Except he contributes $2,000 every single year from age 26 to 65. That means he contributed $80,000 in total… more than five times what his sister had contributed.
By age 65, he’s almost a millionaire too, with $973,074 in his account.
Who’s the winner?
The sister contributed only $14,000 ($2,000 per year over seven years) and ended up with $944,641. That’s a net gain of $930,641, or 66 times her original investment.
The brother contributed $80,000 ($2,000 per year over 40 years) and ended up with $973,074. That’s a net gain of $893,074, or 11 times his original investment.
The sister was able to accomplish much better results with much less money… all because she realized the power of compounding over long periods of time.
If you missed this, go back and read the example again until you realize what happened.
Compounding is not only an incredible wealth builder but also simple to do. First, you need an investment that generates a return every year for many years in a row. Then, you need time and perseverance to let the dividends grow.
Compounding doesn’t require vigilance, activity or effort to make it work. In fact, it works best when you forget about it altogether.
So warm up your compounding engine and get your portfolio growing. It’s the only time-proven way to win the retirement income race.
And the best way to start is with a monthly income portfolio. You can reinvest these dividends every month like clockwork.
The Ultimate Canadian Dividend Stock Portfolio
The Canadian market is tied to the energy and commodities sector. For the sake of diversification, we have selected a company from each of the following sectors: energy, telecommunications, financials and utilities. Without further ado, here are our four hand-selected Canadian dividend stocks.
Suncor Energy – 7.75% Yield
Suncor Energy (NYSE: SU) may be the most popular NYSE-listed Canadian-based company at the moment. Warren Buffett recently acquired a stake of the energy company. Suncor specializes in producing synthetic crude from oil sands. The company operates across every step of the process from resource extraction, upgrading, refining and marketing. This holistic presence boosts its defense against price volatility in the energy sector. With a market cap of around $69 billion, Suncor is one of the largest energy companies in the world and the largest oil producer in Canada. Last year, it ranked 134 on the Forbes Global 2000 list.
On February 5, the company’s board of directors approved a quarterly dividend of $0.31 per share. The dividend hike represents a 17% increase over the previous quarter’s dividend. It is also the 17th year of consecutive annualized dividend increases. Expect Suncor to continue its reliable dividend.
Telus – 4.76% Yield
Telus (NYSE: TU) is one of the biggest telecommunications companies in Canada, and the biggest in British Columbia and Alberta. It offers a wide range of services, including internet access, voice, entertainment, healthcare, video and television. It receives $13.3 billion in annual revenue from its 13.1 million subscribers. Wireless customers make up the largest portion of those subscribers at 8.9 million.
On March 11, the company’s board of directors approved a quarterly dividend of $0.41 per share. Its annual dividend in 2014 was $1.14. It climbed to $1.57 in 2018, which is a 38% increase. Telus should continue its exceptional growth.
Toronto-Dominion Bank – 5% Yield
Besides the Royal Bank of Canada, Toronto-Dominion Bank (NYSE: TD) is Canada’s biggest bank. Operating in 15 states and Washington, D.C., Toronto-Dominion is now one of the top 10 retail banks in the United States. Its profitability is unmatched. It reported a net income of $1.79 billion through Q1, which is a 2.4% increase from last year.
It has a dividend of $0.22 per share, and many analysts believe that it will increase. The Canadian bank has increased its dividend for eight consecutive years. Toronto-Dominion has increased its annual dividend by 11% a year, from $0.25 in 1998 to $2.01 in 2018. Future dividend growth will depend on increased earnings and the payout ratio. With a current payout ratio of 33%, Toronto-Dominion’s board of directors has room to increase the dividend in the future.
Sun Life Financial – 5.45% Yield
Sun Life Financial (NYSE: SLF) is a financial services company that provides insurance, wealth and asset management solutions. It is one of the largest and oldest life insurance companies in the world. Its total assets exceed $726 billion, and it boasted a net income of $2.2 billion in 2018. Sun Life Financial began an aggressive expansion into the United States during the 2008 financial crisis.
On February 13, the board of directors declared a dividend of $0.50 per share. The dividend was made payable on March 29 to shareholders of record at the close of business on March 1. This is the same amount as was paid the previous quarter. With a payout ratio of 42%, Sun Life Financial’s board of directors has plenty of room to increase the dividend going forward.
Waste Connections – 0.7% Yield
Waste Connections (NYSE: WCN) is an integrated waste services company that provides solid waste collection, transfer, disposal and recycling services. It operates in Canada and the United States. Waste Connections has reported a 422% return over the last 10 years. It outperformed the S&P 500 over that time.
Lately, Waste Connections has been one of the hottest dividend growth stocks. Over the past five years, its free cash flow has gone from $300 million to close to $900 million. That massive increase has allowed Waste Connections to grow its dividend. It has eight consecutive years of annual dividend increases. On February 13, the board of directors declared a $0.16 dividend per share. Waste Connections’ massive free cash flow should allow it to continue paying dividends.
The portfolio of funds above hands you an average yield of 5.75%. That is more than double the “risk-free” rate that government bonds offer.
A $20,000 investment into each stock would hand you $4,600 in annual dividends. That’s money you could spend or reinvest as you see fit.
If you’re looking for an easy and cheap way to bring an extra income stream into your life, these Canadian dividend stocks are a springboard for success. They will boost your income in no time! Start growing your wealth with the power of compounding and live the lifestyle you want well into retirement.
Wealthy Retirement Research Team
P.S. I’ve been working for months on a secret income project, and I just hit a breakthrough.
“Since publishing my book, Get Rich with Dividends, I’ve helped thousands of people achieve their retirement goals.
And today, I’m going to share with you perhaps one of the most astonishing income strategies I’ve ever uncovered from our trusted partner, Alexander Green – Chief Investment Strategist at The Oxford Club.
This may help end the retirement crisis in America.
Hoping these Canadian Dividend Stocks help you, and looking forward to hearing from you soon,
Chief Income Strategist, The Oxford Club