- A new investor, looking to explore possibilities without shelling out too much, may explore stocks that cost only a few dollars
- These stocks are top dividend payers that cost less than C$10, just about the price of a coffee or two
- They all have price-to-earnings ratios under 2.4
It does not take huge sums of money to be part of the stock market. There are plenty of stock options available for cheap.
A new investor, looking to explore possibilities without shelling out too much may explore stocks that cost only a few dollars.
One way of receiving passive income is via investing in dividend stocks. Here there are options like looking into mutual funds or investment companies prioritizing dividend income.
This year hasn’t been great for equities in general, but let’s look at some TSX-listed stocks under C$10 that are some of the top dividend payers.
North American Financial Split Corp (TSX:FFN)
The company invests in large cap US and Canadian companies in the financial sector and its stock closed at C$6.25 Friday, May 5.
Its price is down 16 per cent year-to-date and is it arguably in undervalued territory. Earlier this year, it was around the same price range and it rebounded. It is currently just three per cent above its one-year low of C$6.07 seen on March 8.
The stock’s monthly dividend of C$0.113 per share means that its dividend yield in 21.76 per cent. Dividend yield is the amount paid out to shareholders in dividends relative to stock’s current price.
It has a price-to-earnings (P/E) ratio of 2.4. The P/E ratio denotes how many dollars need to be invested for each dollar earned, which would mean the lower it is compared to its peers, the more desirable.
Dividend 15 Split Corp II (TSX:DF)
It is a mutual fund that prioritizes investing dividend yielding companies that are large caps. DF closed at C$6.22 Friday and has risen four per cent in 12 months.
This year, it is marginally in the red by 0.32 per cent. It might also be inching toward undervalued territory, but it isn’t there yet.
DF’s dividend yield comes in at 19.29 per cent with a C$0.10 monthly dividend payout. Its P/E ratio is lower than FFN’s and that stands at 2.02.
Dividend Growth Split Corp (TSX:DGS)
DGS is in the green year-to-date by three per cent and ended at C$7.01 Friday. In the last year, it has improved by nearly eight per cent.
The stock’s dividend yield is 17.12 per cent and it comes with a dividend yield of C$0.10. Over the last 12 months, the stock moved between C$7.48 and C$5.69.
The stock has a P/E ratio of 2.2.
Brompton Lifeco Split Corp (TSX:LCS)
LCS has been falling in recent weeks and has lost nearly eight per cent in a month. For this year, it is in the red by 20 per cent.
Priced at C$5.53 at market close Friday, LCS may be on the brink of being undervalued.
LCS’ dividend yield is 16.28 per cent with a monthly dividend payout of C$.075 per share. Its P/E ratio of 1.8 is the best in this list.
Financial 15 Split Corp (TSX:FTN)
Like LCS, FTN too has had a bit of a dive, off late, down over six per cent in a month. It is in the red by 13 per cent for this year.
FTN, which closed at C$9.99 Friday, may be said to be undervalued. It saw a 52-week low of C$9.91 and is less than one per cent above that, currently. It hasn’t been in this low a range in the past 12 months.
Its dividend yield is over 15 per cent and it comes with a monthly dividend of C$0.126. Its P/E ratio is 2.2.
Some of the above stocks might be said to be or near to being undervalued and they are top dividend payers that cost less than C$10, just about the price of a coffee or two.
The dividend income they bring, may be reinvested into the stock market, or used for spending. They all have P/E ratios under 2.4 although, in this regard, LCS may seem to be the most attractive.
However, four out of five are in the red for the year but DF’s loss is probably negligible.
Please note, the above content constitutes a very preliminary observation based on the industry, and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.