Dividend News for the Week Ending July 20, 2018

Enbridge Income Fund Holdings Inc.

Ticker ENF.TO
Amount $0.19
Projected Annual Dividend for 2018 $2.26
Record Date July 31, 2018
Payment Date August 15, 2018
Market price as of July 16, 2018 $32.72
Forward Yield 6.91%
Rating AB2
CAGR (since 2011) 9.91%
CAGR (since 2003) 12.01%

Enbridge Income Fund Holdings Inc. is a publicly traded corporation. The Company, through its investment in Enbridge Income Fund indirectly holds high quality, low-risk energy infrastructure assets. The Fund’s assets consist of a portfolio of Canadian liquids transportation and storage businesses, including the Canadian Mainline, the Regional Oil Sands System, the Canadian segment of the Southern Lights Pipeline, Class A units entitling the holder to receive defined cash flows from the U.S. segment of the Southern Lights Pipeline, a 50 percent interest in the Alliance Pipeline, which transports natural gas from Canada to the U.S., and interests in more than 1,400 MW of renewable and alternative power generation assets. Source: Company Filings

The firm has been paying a dividend since 2003 but made a switch to a dividend paying corporation in 2011. Given its long track record it ranks as an A1B3 stock, but for comparison purposes CAGR is better measured since the conversion to a dividend paying corporation. Even then, since 2011 CAGR is an impressive 9.91%.

First National Financial

Ticker FN.TO
Amount $0.15
Projected Annual Dividend for 2018 $1.85
Record Date July 31, 2018
Payment Date August 15, 2018
Market price as of July 16, 2018 $28.80
Forward Yield 6.42%
Rating AC2
CAGR (since 2006) 12.00%

First National is Canada’s largest non-bank lender, originating and servicing both commercial and residential mortgages since 1988. Source: TSX.

FN moved to a dividend paying corporation in 2011, precipitating a cut in its payment to shareholders. Because of the cut, the stock was cut to a C dividend payer rating. That said, it has increased its dividend every year since the conversion, which gives it an overall rating of A1C2.

SECURE Energy Services Inc.

Ticker SES.TO
Amount $0.02
Projected Annual Dividend for 2018 $0.27
Record Date August 1, 2018
Payment Date August 15, 2018
Market price as of July 16, 2018 $7.49
Forward Yield 3.60%
Rating A
CAGR (since 2013) 21.98%

Secure Energy Services Inc is a diversified energy services company providing specialized services to upstream oil & natural gas companies operating in in western Canada and in certain regions in the United States. Source: TSX

SES has a relatively short history but has increased its dividend every year since inception in 2013, except for 2016 where it remained flat. This growth has given it a 22.0% CAGR over that period and earns it an A1 rating.

Vermilion Energy Inc.

Ticker VET.TO
Amount $0.23
Projected Annual Dividend for 2018 $2.72
Record Date July 31, 2018
Payment Date August 15, 2018
Market price as of July 16, 2018 $47.26
Forward Yield 5.74%
Rating B2
CAGR (since 2003) 2.52%

Vermilion is an international energy producer that seeks to create value through the acquisition, exploration, development and optimization of producing properties in North America, Europe and Australia. Our business model targets annual organic production growth, along with providing reliable and increasing dividends to investors. Vermilion is targeting growth in production primarily through the exploitation of light oil and liquids-rich natural gas conventional resource plays in Canada and the United States, the exploration and development of high impact natural gas opportunities in the Netherlands and Germany, and through oil drilling and workover programs in France and Australia. Vermilion holds an 18.5% working interest in the Corrib gas field in Ireland. Vermilion is targeting production of between 75,000 – 77,500 boe/d in 2018. Source: Company Filings

While not a consistent grower, VET has paid out a dividend every year since 2003 with no drops. This rates it as a B2 dividend payer, with a CAGR of 2.52%.

Exchange Income Corporation

Ticker EIF.TO
Amount $0.18
Projected Annual Dividend for 2018 $2.18
Record Date July 31, 2018
Payment Date August 31, 2018
Market price as of July 20, 2018 $32.10
Forward Yield 6.78%
Rating A2
CAGR (since 2004) 8.32%

The Company is a diversified, acquisition-oriented corporation focused on opportunities in two sectors: aviation services and equipment, and manufacturing. The business plan of the Company is to invest in profitable, well-established companies with strong cash flows operating in niche markets. Source: Company Filings

EIF has paid a dividend for the past 15 years, and except for 2010, has increased it every year since 2004. This was even after converting from an income trust to a dividend paying corporation in 2009, which is normally the time that companies cut the amount paid out to shareholders.

MTY Food Group Inc.

Ticker MTY.TO
Amount $0.15
Projected Annual Dividend for 2018 $0.60
Record Date July 31, 2018
Payment Date August 15, 2018
Market price as of July 20, 2018 $57.04
Forward Yield 1.05%
Rating A1
CAGR (since 2011) 18.77%
CAGR (since 2010) 38.23%

MTY Food Group Inc is a Canadian franchisor operating in the quick service food industry. It franchises and operates corporate-owned locations under different banners and brands offering multiple cuisines such as Korean, Japanese, and Mexican.

I’m very attracted to companies such as MTY which offer an easy to understand business model with great realized returns to shareholders. Since starting its dividend in 2010, it has increased it every year except for 2017. At the current pace, the dividend is projected to increase 30% year over year, paying $0.60/share vs. 2017’s $0.46/share. While the company started paying a dividend in 2010, for comparison reasons we measure against 2011 since that was the first full year of payments. Based on that, the CAGR is 18.8%, which is not that bad.

Cineplex Inc.

Ticker CGX.TO
Amount $0.15
Projected Annual Dividend for 2018 $1.72
Record Date July 31, 2018
Payment Date August 31, 2018
Market price as of July 20, 2018 $29.48
Forward Yield 5.83%
Rating A1B2
CAGR (since 2004) 2.92%
CAGR (since 2003) 19.99%

A leading entertainment and media company, Cineplex (CGX) is a top-tier Canadian brand that operates in the Film Entertainment and Content, Amusement and Leisure, and Media sectors. As Canada’s largest and most innovative film exhibitor, Cineplex welcomes over 70 million guests annually through its circuit of 163 theatres across the country. Cineplex also operates successful businesses in digital commerce (CineplexStore.com), food service, alternative programming (Cineplex Events), cinema media (Cineplex Media), digital place-based media (Cineplex Digital Media), amusement solutions (Player One Amusement Group) and an online eSports platform for competitive and passionate gamers (WorldGaming.com). Additionally, Cineplex operates a location-based entertainment business through Canada’s newest destination for ‘Eats & Entertainment’ (The Rec Room) and will also be opening new complexes specially designed for teens and families (Playdium) as well as exciting new sports and entertainment venues across Canada (Topgolf). Cineplex is a joint venture partner in SCENE, Canada’s largest entertainment loyalty program. Source: Company Filings

Love the movies? Then you’ll love Cineplex. The company has been a mainstay in the Canadian movie industry for decades, paying shareholders since 2003. Initially it was an income paying trust but converted to a dividend paying corporation in 2009. Its CAGR since 2004 (first full year of distributions) is 2.92%, which not stellar, has definitely beaten out inflation. At today’s prices it has a forward yield of 5.83% and may be a worthy addition to your portfolio as an income payer from the entertainment industry.