Recent Dividend Increase

    As individuals and investors we are always looking for a bargain.  If you like Pepsi and Coke and one of these is on sale at the grocery store when you go, you will grab the one on sale. But I am not talking about that type of bargain.
     We all live busier lives than a few years ago. We never had things to consider before like checking facebook or twitter feeds.  Due to the rise in the cost of living, both parents NEED to work to make ends meet.  The dual income households also usually means your personal health in way of great home cook meals suffer.  The food that is often prepared at home is usual just something thrown together quick to satisfy the hunger after a long day at work and the daily commute.  Sometimes they choose to go to a restaurant or a fast food restaurant.
      As we know most fast food is unhealthy. Some of the common fast food chains are Kentucky Fried Chicken, McDonald's, Burger King, Wendy's and Tim Horton's.  Tim Horton's use to be just a coffee and donut shop, but started to become a restaurant by offering sandwiches and the likes. At these restaurants there are some healthy things on the menu.  These healthy food items cost a little more. People have been more concerned about their diet in the past several years.  Some of these concerns are is the food free of hormones and genetically modified or non-genetically modified.
        In Canada, a fast food chain the is ahead of their peers is A&W.  Some of the things A&W has done in recent years is as follows:

• Serve beef raised without the use of hormones or steroids.
• Serve eggs from hens that are fed a vegetarian diet without the use of animal by-products
• Serve chicken from chickens that are raised without the use of antibiotics and fed a vegetarian diet without animal by-products.
• Serve pork that is raised without the use of antibiotics

   An investor can not buy ownership in A&W Foods, but receive a share of profits.  A&W has a royalty fund called the A&W Revenue Royalties Income Fund (ticker symbol:  AW.UN).  The income fund trades on the Toronto Stock Exchange.

The Fund is a limited purpose trust established to invest in A&W Trade Marks Inc. (Trade Marks), which indirectly owns the A&W trade-marks used in the A&W quick service restaurant business in Canada. The trade-marks comprise some of the best-known brand names in the Canadian food service industry. Trade Marks licences these trade-marks to A&W Food Services of Canada Inc. in exchange for a royalty of 3 per cent of the sales of 861 A&W restaurants in Canada.  

This structure makes the A&W Revenue Royalties Income Fund a "top-line" fund because income is based solely on the sales of A&W restaurants minus the Fund's and Trade Marks' minimal operating expenses, interest on Trade Marks' term debt and income taxes. The Fund is not subject to the variability of earnings or expenses associated with an operating business. (Source: A&W Income Fund) 

  A&W is feeling the effects of the sluggish economy in Alberta.  The oil and gas sector is the largest employer in Alberta and affects a lot of other businesses.  It is said that one operating rig creates 135 jobs directly and indirectly.  The indirect jobs are restaurant workers, hotel staff, convenience stores etc.  Over the coming years A&W plans to expand more in Ontario.
    The price of food at A&W is little more expensive than other fast food restaurants.  The food is better for you and you will less likely to get sick eating A&W over other fast food restaurants.

  A&W Income Fund recently released its 3rd quarter earnings. Some of the highlights are as follows:

• Q3 same stores sales growth of 3.7%
• Royalty income up 6.6%
• 22 new restaurants opened year to date
• Distributions increased by 2.3% (from $1.596 to $1.632 per year )

   The monthly distribution will be increased starting with the November distribution payment on November 30 for unit holders on record date of November 15. 

    I owed 38 units of AW.UN.  Therefore, my annual dividend income is increased by $1.37.  This is not a huge amount but it is better than nothing.

 

DISCLAIMER

I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.

Recent Dividend Increase

    As I go about my daily life, I am amazed at people who through money away.  I have worked with so many people, who can not wait to get their paycheck.  They have plans before they even get the money.  These types of people are broke within a couple days of receiving their pay check.  These type of people complain about power bills saying the power company is robbing us blind.  I often hear things like "Those greedy bastards make millions of dollars in profits this quarter".   I usually say things like, "Instead of complaining about their profits, "Why don't you invest in the power company to get a piece of their profits?"
 
   I like many others, like to make money while I sleep.  I own shares in a utility company called Emera Inc., whose ticker symbol is EMA.  Emera trades on the Toronto Stock Exchange.  Every time someone in Nova Scotia flicks on a light switch, Emera makes money. Emera has operations in other provinces,  the United States, and some other countries.

Conclusion:

      The board of directors of EMA recently announced a dividend increase of $0.17 annually.
The dividend is increasing from $2.09 per share per year to $2.26 per year.  This represents an increase of 8.13%.   This increase is well above an increase in inflation.

       I own 100 shares of EMA and therefore my annual dividend income will increase by $17.00.  This is equivalent of my investing $485.71 of my own money.

       I have owned EMA for a few years now and have been rewarded with multiple dividend increases over years.

Disclosure:  Long EMA

DISCLAIMER

I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.

Dividend Income Update: September 2017

      The month of September is another month of dividend income landing in my accounts. This money is used to help pay my expenses if it is needed. If the money is not needed, it is ALL used to purchase new investments to further increase my cash flow.

       

 Non-registered Account

• Cineplex  (CGX) - $14.00
• Enbridge (ENB) - $9.97
• Enerplus (ERF)  -$ 5.58
• Dream Office REIT   (D.UN)  - $52.58
• High Liner Foods (HLF) - $14.00
• Shaw Communications (SJR.B)    - $19.75

TFSA

• A&W Royalties Income Fund (AW.UN) - $5.05
• Boston Pizza Royalties Income Fund   (BPF.UN) - $26.91
• Canadian National Railway (CNR) - $15.68
• Enbridge (ENB) - $20.13
• iShares 1-5 yr Laddered Canadian Corporate Bond ETF (CBO) - $0.59
• Cominar REIT (CUF.UN) - $16.72
• Dream Office REIT   (D.UN)  - $14.00
• Horizons Natural Gas Yield ETF (HNY)  - $5.03
• Killam Properties REIT (KMP.UN) - $  15.60

Total = $235.59

    
    I had a big position in D.UN that I did not account for until last September. As a result of this large position being added to the dividend income total, I did not do a year over year comparison for the previous 12 months.

    I received a total of $235.59 in dividend income for the month of September 2017.  This represents a 8.39% decrease from 3 months ago and 0.51% increase year over year.  The small increase year over year is a result of distribution cuts to D.UN and CUF.UN and offset increase unit numbers from these positions and some other transactions.

    I received $57.10 from option premiums in September 2017.

     I will update my dividend income tab with the new amount I will include my option premium income also.  It is great to see money from passive income sources deposited into my brokerage account every single month.

How was your dividend income for September?

Disclosure : Long all securities above.

Photo Credit: www.mipaq,co.za

DISCLAIMER

I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.

Portfolio Update: September 2017

  The month of September 2017 is now behind us.  Like any month, there is lots of news.  We have the ongoing battle with the price of a barrel of crude oil.  The price of oil effects the amount of jobs in the oil and gas industry.  It is often said that one rig creates 135 jobs directly and indirectly.

   Currently the United Conservative Party of Alberta is in the midst of a leadership race.  The Rachel Notley led NDP government has raised the minimum wage from $12.20 to $13.60 an hour on October 1.  I have noticed that a lot of places have already raised their prices to offset the minimum wage. Some analysts think that the increases to minimum wage in Alberta and Ontario at the drastic amounts will lead to lots of layoffs.

   I sold out of my position in TD.TO.  My average price was around $69.62, so I sold my 100 shares at $70.18.  The stock has risen some since then but I believe the stock will fall  below $70.00 again.  If my average price was lower,  I would not of sold my position.  Unfortunately, you or I cannot predict the right side of the chart.  Recently, the Trump administration wants to reduce taxes for Americans and American businesses.  TD has a lot of branches in the United States, so this news on potential tax cuts could be putting upward pressure on the stock.  I will invest in TD Bank again if the stock falls below the price I am willing to buy.

   We often hear that lots of people do not get enough seafood in their diets. People are often stretched for times these days as lives seem to be always busier.  People often end up going to a restaurant they cannot afford or going to get fast food.  An alternative to this is to buy frozen stuff and cook at home.  High Liner Foods (ticker symbol HLF.TO ) is one such company that is in this space.  High Liner Foods is a market leader in the frozen fish market which has products for residential consumers and business customers.  High Liner Foods is also a supplier to McDonald's Restaurants.  I purchased 100 shares of High Liner Foods at $13.45 per share foe a total cost of $1349.95 including commissions.  I now own 200 shares of High Liner Foods..

    Another way of making money in the markets is to sell option premiums.  I sold one put option contract in RY.TO  with a October 20 2017 expiration day for a total premium of $21.05 including commissions.  The stock was trading higher, so I wrote a covered call for RY.TO with an October 20 2017 expiration date for total premium of $36.05 including commissions.  Therefore, I collected $57.10 in option premiums for this stock. The covered call is currently way in the money.

     Last September, I started to included my position in Dream Office REIT (ticker symbol D.UN) in my margin account. I also have a position in D.UN inside my TFSA.  So starting this month when I post about my dividend income, I will do a year over year comparison on top of the three month comparison.

As of  Sept 1,  the value of the portfolio is $106918.63.  This is a 2.37% increase over last month's total.  The spreadsheet in the investment tab above has been updated.


Disclosure:  Long D.UN, RY.TO

Please Note:  All stocks are from the Toronto Stock Exchange except TTR which trades on the Venture Exchange.
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DISCLAIMER

I am not a financial planner, financial advisor, accountant or tax attorney. The information on this blog represents my own thoughts and opinions and should NOT be taken as investment or business advice.

Every individual should do their due diligence to make their own financial decisions based on their financial situation and tolerance for risk.