The Dividend Growth Story. December 2011

Transcription

1 The Dividend Growth Story December 2011

2 Canadian Equity Model Portfolio Canadian Equity Model Portfolio (As of December 31st 2011): Dividend Yield: 3.41% Dividend Growth Rate: One Year: +4.5% Five Years: +7.5% The BCV Asset Management Canadian Equity Model Portfolio consisted of twenty five companies at the end of December In 2011, seventeen companies increased their dividend and eight companies maintained their dividend at the same level as in This trend represents an improvement over 2010, where eleven companies increased their dividend, twelve companies maintained their dividend, and two companies decreased their dividend. The six companies that increased their dividends in 2011 after not increasing their dividend in 2010 were from the banking and mutual fund sectors. The Canadian banks which increased their dividends (Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Canadian Western Bank, National Bank of Canada, Royal Bank of Canada) were able to do so because the impact of the increased capital requirements under Basel III became known, the economy continued to strengthen, and earnings continued to recover. The mutual fund company that increased its dividend (IGM Financial Inc.) was able to do so because the economy continued to strengthen and earnings continued to recover. The eight companies that did not increase their dividend in 2011 were from the banking, diversified financial services and energy sector. The one major Canadian bank that has yet resume dividend increases is Bank of Montreal, although it is widely expected that this will happen in Five of the six diversified financial services companies that have not increased their dividend (Great-West Lifeco Inc., Industrial Alliance Insurance Inc., Manulife Financial Corporation, Power Financial Corporation, and Sun Life Financial Inc.) continue to have earnings that lag pre-recession levels, as investment performance is an important component of earnings. Brookfield Asset Management Inc. and Cenovus Energy Inc. are the other companies that did not increase their dividend in A full outline of the five year history of the companies in the BCV Asset Management Canadian Equity Model Portfolio is provided on the following page.

3 Dividends Paid Growth Rate Year 5 Years Bank of Montreal (BMO) % 4.4% Bank of Nova Scotia (BNS) % 6.4% Brookfield Asset Management Inc. (BAM.A) % 6.1% Canadian Imperial Bank of Commerce (CM) % 4.9% Canadian National Railway Company (CNR) % 14.9% Canadian Natural Resources Ltd. (CNQ) % 19.3% Canadian Pacific Railway Ltd. (CP) ) % 9.9% Canadian Western Bank (CWB) % 16.7% Cenovus Energy Inc. (CVE) % N/A Fortis Inc. (FTS) % 11.6% Great-West Lifeco Inc. (GWO) % 5.8% IGM Financial Inc. (IGM) % 7.0% Imperial Oil Ltd. (IMO) % 6.6% Industrial Alliance Insurance Inc. (IAG) % 10.3% Manulife Financial Corporation (MFC) % -6.4% National Bank of Canada (NA) % 6.9% Power Financial Corporation (PWF) % 7.7% Royal Bank of Canada (RY) % 7.6% Saputo Inc. (SAP) % 13.0% Sun Life Financial Inc. (SLF) % 5.4% Suncor Energy Inc. (SU) % 23.4% TELUS Corporation (T) % 14.3% Tim Hortons Inc. (THI) % 37.2% Toronto-Dominion Bank (TD) % 8.0% TransCanada Corporation (TRP) % 5.6%

4 First Quarter 2011 Second Quarter 2011 Third Quarter 2011 Fourth Quarter 2011 Canadian National Railway Company paid 32 cents per share (27.5 cents). Canadian Western Bank paid 13 cents per share (11 cents) Fortis Inc. paid 29 cents per share (28 cents). National Bank of Canada paid 66 cents per share (62 cents). TELUS Corporation paid 52.5 cents per share (50 cents). Tim Hortons Inc. paid 17 cents per share (13 cents). Bank of Nova Scotia paid 52 cents per share (49 cents). Canadian Natural Resources Ltd. paid 9 cents per share (7.5 cents). Canadian Western Bank paid 14 cents per share (13 cents). Suncor Energy Inc. paid 11 cents per share (10 cents). Toronto-Dominion Bank paid 66 cents per share (61 cents). TELUS Corporation paid 52.5 cents per share (50 cents). TransCanada Corporation paid 42 cents per share (40 cents). Canadian Pacific Railway Ltd. paid 30 cents per share (27 cents). National Bank of Canada paid 71 cents per share (66 cents). Royal Bank of Canada paid 54 cents per share (50 cents). Saputo Inc. paid 19 cents per share (16 cents). TELUS Corporation paid 55 cents per share (52.5 cents). Canadian Imperial Bank of Commerce paid 90 cents per share (87 cents). IGM Financial Inc. paid cents per share (51.25 cents). Toronto-Dominion Bank paid 68 cents per share (66 cents).

5 United States Equity Model Portfolio The BCV Asset Management United States Equity Model Portfolio consisted of twenty four companies at the end of December In 2011, twenty three of these companies increased their dividend and one company paid a dividend for the first time (Cisco Systems Inc.). This trend represents an improvement over 2010, where eighteen companies increased their dividend, four companies maintained their dividend, and two companies decreased their dividend. A full outline of the five year history of the companies in the BCV Asset Management United States Equity Model Portfolio is provided on the following page. United States Equity Model Portfolio (As of December 31st 2011): Dividend Yield: 2.66% Dividend Growth Rate: One Year: +15.7% Five Years: +8.8%

6 Dividends Paid Growth Rate Year 5 Years 3M Company (MMM) % 3.6% AFLAC Inc. (AFL) % 17.5% Becton Dickinson & Company (BDX) % 13.5% Cisco Systems Inc. (CSCO) N/A N/A Coca-Cola Company (KO) % 8.7% ConocoPhillips (COP) % 12.9% Exxon Mobil Corporation (XOM) % 7.6% General Mills Inc. (GIS) % 11.1% Hewlett-Packard Company (HPQ) % 4.6% Honeywell International Inc. (HON) % 8.6% International Business Machines Corporation (IBM) % 21.4% Johnson & Johnson (JNJ) % 9.1% Johnson Controls Inc. (JCI) % 11.4% JPMorgan Chase & Company (JPM) % -10.1% Kimberly-Clark Corporation (KMB) % 7.5% McDonald s Corporation (MCD) % 20.4% Medtronic Inc. (MDT) % 17.8% Microsoft Corporation (MSFT) % 12.9% PepsiCo Inc. (PEP) % 12.2% Procter & Gamble Company (PG) % 11.2% Teva Pharmaceutical Industries Ltd. (ADR) (TEVA) % 25.4% United Technologies Corporation (UTX) % 12.9% Verizon Communications Inc. (VZ) % 3.9% Wells Fargo & Company (WFC) % -15.0%

7 First Quarter 2011 Second Quarter 2011 Third Quarter 2011 Fourth Quarter M Company paid 55 cents per share (52.5 cents). Cisco Systems Inc. paid an initial dividend of 6 cents per share. General Mills Inc. paid 30.5 cents per share (28 cents). AFLAC Inc. paid 33 cents per share (30 cents). ConocoPhillips paid 66 cents per share (55 cents). Coca-Cola Company paid 47 cents per share (44 cents). Hewlett-Packard Company paid 12 cents per share (8 cents). Becton Dickinson & Com pany paid 45 cents per share (41 cents). Honeywell International Inc. paid cents per share (30.25 cents). Johnson Controls Inc. paid 16 cents per share (13 cents). International Business Machines Corporation paid 75 cents per share (65 cents). Exxon Mobil Corporation paid 47 cents per share (44 cents). Johnson & Johnson paid 57 cents per share (54 cents). JPMorgan Chase & Company paid 25 cents per share (5 cents). Medtronic Inc. paid cents per share (22.5 cents). Honeywell International Inc paid cents per share (33.25 cents). McDonald s Corporation paid 70 cents per share (61 cents). Microsoft Corporation paid 20 cents per share (16 cents). Verizon Communications Inc. paid 50 cents per share (48.5 cents). Kimberly-Clark Corporation paid 70 cents per share (66 cents). PepsiCo Inc. paid 51.5 cents per share (48 cents). Procter & Gamble Company paid 52.5 cents per share (48.18 cents per share). United Technologies Corporation paid 48 cents per share (42.5 cents). Wells Fargo & Company paid 12 cents per share (5 cents).

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