Saturday, February 8, 2020

Recent Dividend Increases

Over the last couple of weeks a few stocks I owned have reported earnings.  These stocks are Canadian companies but trade on both the Toronto Stock Exchange and the New York Stock Exchange.  These stocks are in 2 complete different industries.

First off, Canadian National Railway, aka CN Rail, reports earnings on January 28.  CN Rail trades on both Toronto Stock Exchange and New York Stock Exchange under ticker symbols CNR and CNI, respectively.

Q4 2019 vs Q4 2018
  •  Revenues of 3.584 billion CAD, which is a decrease of 6%
  •  Adjusted diluted EPS of $1.25 CAD, which is a decrease of 16%
  • Operating ratio of 66.0%, which is an increase of 4.1 points
  • Adjusted operating ration of 65.2%, which is an increase of 4.0 points
  • Operating income of $1.218 billion CAD, which is a decrease of 16%.
During Q4 2019, CN had an 8 day labour strike.  The lead to masses loss of revenue as the trains were only operating at a 10% capacity.  

The economy is starting to slow, which affects the transportation industry.  

CN Rail network involves serving 3 coasts.  Due to winter in Canada, the trains must be shorter in length due to the effect the cold has on air brake lines.  This leads to a higher operating ratio compared to the average for the year.

CN announced a dividend increase of 6.97%.  The quarterly per share dividend was increased to $0.575 CAD from $0.5375 CAD, or $2.15 CAD per share annually  to $2.30 CAD per share annually.  I currently own 38 shares of CNR.TO.  Therefore, this increase adds $5.70 CAD.

This dividend increase represents the 24th consecutive year that the dividend was raised.  CN Rail became a public company in 1995. 

Second Raise

On Feb 6, Bell Canada Enterprises ( ticker symbol: BCE) released its Q4 earnings and full year earnings. 

Some of the highlights of the Q4 earnings release are as follows:
  • Net earnings increased 12.6% to $723 million CAD
  • Net earnings attributable to common shareholders grew 10.9% to $672 million CAD, or $0.74 per share.  This is an increase of 8%.
  • Q4 cash flows from operating activities increased 16.9% to $2.091 billion CAD
  • Q4 free cash flow of $894 million CAD contributed to 7% growth  for full year 2019. 
BCE announced a dividend increase with the earnings release.  The dividend was increased from $0.7925 per share quarterly to $0.8325 per share quarterly, or from $3.17 per share annually to $3.33 per share annually.  This represents an increase of 5.05%.  I currently own 100 shares of BCE.  Therefore, this increase adds $16.00 CAD to my annual dividend income.

Disclosure:  Long BCE, CNR


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.

No comments:

Post a Comment