5 TSX stocks to buy that have hiked their dividends


  • The highest dividend increase posted by one of the below mentioned companies was 50 per cent over the previous quarter.
  • The stock price of one of the listed companies returned close to 67 per cent in the past year.
  • The highest ROE among them was 69.74 per cent, and ROA was 64.70 per cent.

An increase in dividends signals a healthy cash position and increases the confidence of investors in the stock. Newport Exploration Ltd (NWX), one of the stocks covered in this story, has been recognized by the TMX group in terms of highest dividend yield, which stood at 17.77 per cent.

On that note, let us explore some of the companies that hiked dividends recently across industries and sectors.

1. Cascades Inc. (TSX: CAS)

Cascades Inc. is a company engaged in forest products. It recycles fibers, thereby producing and marketing tissue paper, packing products, and other containerboards. The products manufactured by the company are used across industries.

The investors of Cascades are expected to be paid quarterly dividends of C$ 0.12 per share on September 2, 2021.

As per the latest quarterly report, the dividend of the manufacturing company increased from C$ 0.08 in the first quarter of the fiscal year 2021 to C$ 0.12 per share to be paid in Q2 FY2021. This increase in dividend by 50 per cent on a quarter-on-quarter (QoQ) basis is expected to boost investors' confidence.

Cascades Inc posted sales of C$ 956 million in Q2 FY21, down from over C$ 1 billion in Q2 FY20. The net earnings in the same quarter were C$ 3 million. The pandemic increased the volatility in demands and prices of raw materials in Q2 FY21 as well.

The company's stock price closed at C$ 15.68 on August 31, 2021, and the one-year stock return was 13 per cent. The company held earnings per share (EPS) of 1.47 and a return on equity (ROE) of nine per cent on August 31.

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2. Elysee Development Corp (TSXV: ELC)

This C$ 19.75 million market cap firm is a venture capital and private equity company that invests in the natural resources sector. Their investments are made in publicly traded enterprises ranging from small to medium-sized.

Elysee Corporation held a price-to-earning (P/E) ratio of 3.3 and ROE of 33.35 percent. Moreover, the investors of this company were paid a semi-annual dividend of C$ 0.03 per share on March 3, 2021. These dividends paid on March 3, 2021, were increased from C$ 0.01 (November 27, 2020).

Elysee Corporation posted net earnings of C$ 2.05 million in Q2 FY21, and its net investment income was C$ 2.14 million in the same quarter.

On August 9, 2021, the company's stock price reached its 52-week high of C$ 0.85, and it closed at C$ 0.70 on August 31. Within one year, the stock price expanded by nearly 67 per cent.

Also Read: 5 Top dividend-paying metal stocks for 2021

3. Diversified Royalty Corporation (TSX: DIV)

This company earns management fees and royalty fees as its revenue. Diversified Royalty Corporation held outstanding shares of 121.94 million and a market cap of C$ 346.3 million on August 31.

At the market close of August 31, stocks of the company were priced at C$ 2.84. On this day, it traded nearly four per cent below its 52-week high of C$ 2.95 (August 5, 2021). It surged up by 59 per cent over the past year, but it only increased by 19 per cent on a year-to-date (YTD) basis.

The asset management company announced its next monthly dividends of C$ 0.018 on August 31, 2021. The dividend yield stood at 7.39 per cent.  The company's board of directors increased the monthly dividend from C$ 0.01667 per share (July 30, 2021) to C$ 0.0175 (August 31, 2021).

Diversified Royalty held an EPS of 0.05, ROE of 3.55 per cent, and return on assets (ROA) of 1.91 per cent (at the time of writing).

4. Telus Corporation (TSX: T)

Telus is one of Canada’s leading telecom giants providing wireless internet, mobile and land phone services. The company stood with a market cap of C$ 37.15 billion and 1.28 billion outstanding shares.

Stocks of Telus closed at C$ 29.07 on August 31 and traded 29 per cent above its 52-week low of C$ 22.5 (November 2, 2020). The stock price increased by 4.5 per cent on a quarter-to-date (QTD) basis, but it climbed up by 21 per cent over the past year.

The shareholders of Telus are expected to be paid quarterly dividends of C$ 0.316 on October 1, 2020. The company increased dividends from C$ 0.311 paid on April 1, 2021.

Telus posted total revenue of C$ 4.1 billion in Q2 FY2021. In valuation metrics, the debt to equity (D/E) ratio was 1.36, ROE was 9.35 per cent, and ROA was 2.91 per cent.

Also Read: 5 shockingly cheap TSX dividend stocks to buy under C$ 10

5. Newport Exploration Ltd (TSXV: NWX)

The dividend-paying metal and mining company held 105.58 million outstanding shares and a market cap of C$ 47.51 million. The shareholders of Newport Exploration are scheduled to be paid quarterly dividends of C$ 0.02 on September 10, 2021. The dividend yield stood at 17.77 per cent.

The historically paid dividend increased from C$ 0.01 paid on March 12, 2021, or Q1 FY 2021, to reach C$ 0.02, which was paid on June 10, 2021, or Q2 FY 2021. 

The average price of oil increased by 10 per cent quarter-on-quarter (QoQ) as per the latest update provided by the company.

The stock price of the mining scrip reached its 52-week high of C$ 0.6 on February 11, 2021, and on August 31, it closed at C$ 0.45. On a QTD basis, the stock price increased by 2.3 per cent.

The valuation metrics show that the company held a P/B ratio of 5.6, ROE of 69.74 per cent, and ROA of 64.70 per cent.

Bottom line:

An increase in dividends at regular intervals signifies a healthy cash proposition of the company. It increases investor confidence and signals better management of the operations of the company.



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