Dividend Income – April 2017 Update

Can you believe that it is already May? Thanks to the warmer and dryer weather, Mrs. T, the kids, and I have been spending more time outside. This past Sunday we spent most of the day working in the yard, mowing the lawn, weeding the vegetable garden, and seeding more vegetables. As you can see from the picture above, things are growing nicely in our vegetable garden. We have a lot of strawberry plants and I can’t wait for strawberry harvest!

One of the things I have been debating lately is whether to continue DRIPing in our investment accounts. I often get the feeling that the market is near its peak. Does it make sense to continue DRIPing stocks like TD, Royal Bank, Enbridge, and Telus? Or is it better to stop DRIPing, lock in our Adjusted Cost Base (ACB), and use the cash to purchase other discounted stocks? It’s a tough question. πŸ™‚

April Dividend Income

In April 2017 we received dividend income from 25 companies:

  • Pure Industrial REIT (AAR.UN)
  • Agrium (AGU.TO)
  • BCE Inc (BCE.TO)
  • Bank of Nova Scotia (BNS.TO)
  • Corus Entertainment (CJR.B)
  • CIBC (CM.TO)
  • Canadian Natural Resources (CNQ.TO)
  • Dream Office REIT (D.UN)
  • Dream Global REIT (DRG.UN)
  • Dream Industrial REIT (DIR.UN)
  • General Electric (GE)
  • H&R REIT (HR.UN)
  • Inter Pipeline (IPL.TO)
  • KEG Income Trust (KEG.UN)
  • Coca-Cola (KO)
  • Prairiesky Royalty (PSK.TO)
  • Rogers (RCI.B)
  • RioCan REIT (REI.UN)
  • Smart REIT (SRU.UN)
  • Telus (T.TO)
  • TD (TD.TO)
  • TransCanada Corp (TRP.TO)
  • Domtar Corp (UFS.TO)
  • Vanguard All-World Ex-Canada (VXC)
  • Wal-Mart (WMT)

In total we received $1,212.18 in dividend income.

Woohoo! We have achieved a major milestone! This marked the first time that we received over $1,200 in monthly dividend income. We have been very close in February and March, so it was great to finally reach this milestone. Look out $1,300, we are coming for you!

Out of the $1,212.18 dividend income that we received in April, $164.11 was in USD and $1,048.07 was in CAD. Please note, we use a 1 to 1 currency rate approach. Therefore, we do not convert dividends received in USD to CAD. We are ignoring exchange rate to keep the math simple. This is our way to avoid fluctuations in dividend income over time due to changes in the exchange rate.

The top 5 dividend payouts in April 2017 were TD, BCE, Bank of Nova Scotia, Coca-Cola, and CIBC. The top 5 payouts accounted for 50.2% of our April dividend income.

Dividend Growth

Compared to April 2016 we saw a YOY growth of 17.26%. It was the lowest YOY performance so far in 2017 but I was still pretty happy with this performance. We need to continue adding more dividend growth stocks to boost our dividend income.

Dividend Increases

In April a number of companies that we own in our dividend portfolio announced dividend increases:

  • Johnson & Johnson raised dividend by 5% to $0.84 per share
  • Omega Healthcare raised dividend by 1.61% to $0.63 per share
  • Procter & Gamble raised dividend by 3% to $0.6896 per share
  • Unilever plc raised its dividend by 12% to β‚¬0.3585 per share

If we ignore the Unilever dividend raise (because it is tough to figure out the exact impact due to exchange rate), the other raises have increased our annual dividend income by $21.93.

Dividend Stock Purchases

I was very happy to see some volatility in April. I took advantage of the volatility and made a few purchases.

  • 14 shares of Canadian Imperial Bank of Commerce (CM.TO)
  • 100 shares of Enbridge Income Fund (ENF.TO)
  • 46 shares of Metro Inc (MRU.TO)

These purchases added $251.22 toward our annual dividend income.

Due to the poor CAD to USD exchange rate, we plan to avoid converting CAD into USD in the short term. Hence, we will be focusing mostly in the Canadian stock market.

Summary

April dividend income was excellent. It felt so nice to finally reach the $1,200 per month milestone. Although the market appears to be near its peak, we plan to continue executing our investing strategy. There’s no change in course for us.

So far in 2017 we have received a total of $4,688.02 in dividend income. This comes to an average of $1,172 per month for the first four months of 2017. At an hourly wage of $40, this means we have saved ourselves over 29 working hours each month. Or almost 4 working days each month. This is a perfect example of having our money work hard for us so we don’t have to.

Dear readers, how was your April dividend income?

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52 thoughts on “Dividend Income – April 2017 Update”

  1. Hi Bob, what are your thoughts on owning Enercare as a dividend stock? The price seems attractive this week but curious on your take on it? Thanks!

    Reply
    • I don’t know too much about Enercare but at initial look, PE is pretty high and the payout ratio is over 100% so both are concerning. But if the stock is more like an income fund then need to look at FFO to determine if payout is sustainable.

      Reply
  2. Hi Bob, I love following your dividend updates. I was going to ask earlier but decided not to haha. I’ve been looking for a good value dividend with a great return and an under $20 stock price. A lot of reading says Superior Plus Corp is a strong, stable company returning over 5%. I figure at these numbers, you would have come across them. If you have, just curious about your opinion in holding a position in them. Thanks!

    Reply
    • We used to own SPB a long time ago but sold it. I haven’t looked at it in a while but years ago I wouldn’t label them as a strong, stable company.

      Reply
  3. Great work Bob, very impressive month and even yearly numbers! With the drip why not keep dripping they are great companies. keep stacking the dividend all stars! nice garden, sucks this was the weekend in Ontario to put out the vegetables but still getting the siding done and cant plant at side of house yet. soon enough!

    Reply
  4. Great report Tawcan. Dividends are truly passive income that has no real parallel in the investing world. At my quantum of dividends, I don’t expect massive increases but 8-10% should happen this yeae, let’s see. The important point is that dividends cover our living expenses since 2016, though we are reinvesting.

    Reply
  5. Congrats on $1200 Bob! In terms of DRIP, are you setup to DRIP through your brokerage or through the individual company’s transfer agent? I’ve got a few positions that are still pretty small and so are not enough to purchase full shares from the dividends and therefore the brokerage DRIP does not provide any benefit. I’m just learning about how to set up the DRIP and SPP without the brokerage now.

    Reply
    • Hey Lee,

      I set them up through TD and Questrade. Both TD and Quetrade only offers synthetic DRIP so you need to have enough dividend income to DRIP 1 full share. We do have full DRIP set up for the kids on their dividend portfolio where you can DRIP partial shares.

      To set up full DRIP requires you getting a share certificate and setting it up with the respective transfer agent typically (a bit of a long process). Alternatively, ShareOwner (https://www.tawcan.com/creating-legacy-dividend-portfolio-kids/) is a good option to go if you don’t want to spend the time yourself.

      Reply
  6. 17% dividend growth is nothing to sneeze at Tawcan! It seems like you’re doing great.

    Since I’m no longer working, my dividend growth has slowed. That said, I’m still looking for 10% growth this year.

    Reply
  7. Congratulations on reaching $1200 in a month for dividend income!
    Although my dividend income in April was not the greatest, I hold a few of the companies mentioned in this post. In regards to your drip question, as long as nothing has fundamentally changed with the companies, I would continue to drip. It depends on your goals and investment time frame though. Thanks for sharing the great report! I’m planning on getting back into the dividend income reports in June.

    Reply
  8. You’ve done extremely well and the growth of your income attest to a well chosen path. I’m reading Concentrated Investments and though the eight people are in a different league, they seem to agree on several key points:
    – Invest in the best companies
    – Invest for the long term
    – Invest when the companies are value priced
    – Diversification reduces returns
    – Hold large position in a few great companies (anywhere from 3 to 10)
    Not what most investors would adhere to, but overall sound advice. We don’t need to become the best investor or even a great one, but investing for income and income growth will allows one to see the results of their efforts and know that its working regardless what the market is doing.

    Reply
  9. Awesome dividend return for the month, and even cooler veggie garden (maybe I’m hoping you’ll start a blog on growing a backyard veggie patch, I’m not really sure ;)).

    Do you often report your non-DGI holdings or are they included in these updates too?

    Reply
  10. What made you change your mind about MRU? A few months ago (when the price was lower πŸ˜‰ ), I recall you mentioning that the grocery space is too competitive in Canada.

    Reply
    • Good question. I spent a bit more time reading MRU financial filings. While the grocery space is very competitive, we all have to eat, so there’s going to be profits to be made somewhere. Definitely wished that we purchased MRU a few months ago when price was lower. Oh well.

      Reply
  11. Impressive to see how you keep hovering around the 15-30% YOY dividend increases each month. Well done mate! Congrats on hitting the CAD 1200 milestone.

    Reply
  12. “Although the market appears to be near its peak”

    Oh cool Thanks Bob, can you tell me where that peak is ?

    Reply
    • I can argue for hours on whether the market is near its peak or not. I don’t have the magic 8 ball to know for sure where the market peak (or market bottom) is. If I do then I’d be a billionaire. πŸ™‚

      Reply
  13. Excellent year over year growth continues for you this year. Amazing consistency down the months too. Congrats! Looking forward to the next one!

    Reply
  14. That is some impressive dividend income. That is almost 3 times as much as my April 2017 income, which is my all time highest.

    Our banks have traded in the 4% to 5% yield for the most part for a while, with TD having the lowest yield. So I think the banks are highly valued right now. There are analysts predicting if Canada has a housing correction, it will create a really good buying opportunities with the banks.

    Reply
    • Canadian banks do provide pretty decent yield. I can’t say whether we’ll see a housing correction or not. If we do I don’t think it’s going to be as dramatic as what we saw in the US during the financial crisis.

      Reply
  15. “Meowing” the lawn? You’ve gotta teach me that technique! πŸ˜‰

    You have a lot of REITs in your portfolio. Aren’t you worried about being over-leveraged in the real estate market especially as you have a house in Vancouver?

    Reply
    • Haha it’s a Canadian thing. πŸ˜‰ :p

      About 13% of our portfolio is in REITs, the REITs we invest in are in different sectors, not worried about being over-leveraged at all.

      Reply
      • Hi Tawcan,

        With so many malls closing and big box warehouses reporting declining sales, what are your thoughts about the future income generated by REITs that have significant investments in commercial properties?

        Thanks in advance for your answer!

        Reply
        • Good question Muki. I think there will always be a need for shopping malls. Yes Amazon of the world is gaining popularity, but there are so many things that people prefer seeing them before making a purchase. For example, would you buy an appliance without actually looking at it?

          Reply
  16. Awesome income so far this year. I truly hope the market is near its peak so that is drops and we DGI folks can buy a basket of companies at a discount. Who knows when that will happen though.

    Reply
  17. As usual a nice long list of companies paying you for the month. Pretty diversified. Looks like you are firing on all cylinders as that year over year gain demonstrates. Of course, having many solid dividend payers raise their dividends doesn’t hurt either. Regarding DRIPs. I’m still DRIPing on all positions. Deciding whether to DRIP or not is kind of like asking what’s the best time to buy a stock or time to buy a stock. DRIPing allow for faster compounding. Great results for April. Keep it up!

    Reply
    • Very true whether to DRIP or not is like asking what’s the best time to buy a stock. Hard to time it. Best to just let things compound.

      Reply
  18. Saw a lot of talk on blogs last year about the market peaking. If you had sold then like a few did, you’d have missed out on the massive run since πŸ™‚

    Awesome month btw, congrats!

    Reply
    • Haha very true. Can’t time the market. I’m just wondering if it’s better to leave things the way it is or let the dividend accumulate and buy stocks that are cheaper.

      Reply
  19. Great results! Looks like it is the year of all months above 1k and some above 1.3k and that in only 6 years.

    Like your strawberry, I look forward to our raspberries!

    Reply
  20. Tawcan –

    The streak is alive! The 4 digit marks are incredible. Just wow. Speechless. Love how you break it down into days and hours. This definitely gives you more time in working on the garden, that’s for sure! Keep it up, loving it. Also – nice increases and purchases this past month.

    -Lanny

    Reply
  21. Great steady increases and congrats for the month. We had three record months in our own portfolio, my mom’s and my kids..posts will be out soon starting with my own portfolio tomorrow.

    We hope to catch up with you :-)) although I consider it a nice challenge.

    Reply

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