November Watchlist

October flew by it seems and now it is already time to consider which stocks will make the short list for screening in November. After a bumpy September, October seemed to offer a small recovery in terms of North American markets. Here is how these major markets fared since the end of August: (DJIA 3.6%, S&P 500 1.7%, NASDAQ 2.1% and the S&P/TSX -5.7%). I have a long-term horizon and plan to hold my stocks through significant volatility. The way I see it, downturns are excellent buying opportunities.

I plan on purchasing a new holding in the Canadian financial sector, or adding to my existing position in RY.

Eventually, I plan on holding Canadian, U.S. and international equities in my portfolio. Given the loonie is still trading at 10 year lows against the greenback, I doubt I will be purchasing USD denominated stocks this month.

Here are my Canadian financial shortlist options for consideration this month: TD, BNS, RY, and BMO. Before making my purchase, I will screen these shortlist contenders against several other equities in the sector to find the best fit.

The Toronto-Dominion Bank (TD) provides financial products and services. The bank operates through three business segments: Canadian Retail, U.S. Retail, and Wholesale Banking.

Ticker TD
Stock Price $53.37
EPS $4.16
Dividend $0.51 $2.04
P/E 12.83
Dividend Yield 3.82%
Payout Ratio 47.0%
Div Growth Rate 6.57% 2014/TTM

The Bank of Nova Scotia (BNS)
operates as a diversified financial services institution that provides a wide range of financial products and services to retail, commercial and corporate customers.

Ticker BNS
Stock Price $59.00
EPS $5.32
Dividend $0.70 $2.80
P/E 11.09
Dividend Yield 4.75%
Payout Ratio 63.7%
Div Growth Rate 14.56% 2014/TTM

Royal Bank of Canada (RY)
engages in the provision of diversified financial services. It operates through the following business segments: Personal and Commercial Banking, Wealth Management, Investor and Treasury Services, Capital Markets, and Insurance.

Ticker RY
Stock Price $73.94
EPS $6.56
Dividend $0.79 $3.16
P/E 11.27
Dividend Yield 4.27%
Payout Ratio 46.4%
Div Growth Rate 3.46% 2014/TTM

Bank of Montreal (BMO) provides banking and financial services to individuals and institutions. BMO operates through three segments: Personal and Commercial Banking, Wealth Management & BMO Capital Markets.

Ticker BMO
Stock Price $74.24
EPS $6.32
Dividend $0.82 $3.28
P/E 11.75
Dividend Yield 4.42%
Payout Ratio 49.3%
Div Growth Rate 1.92% 2014/TTM

Even though they aren’t under consideration this month, here are the US/International financial stocks currently on my foundation watch list: HSBC and WFC.

I look forward to hearing your ideas on dividend stocks in the financial sector.

Disclosure: long RY, no current holdings in any of the other stocks mentioned.


7 thoughts on “November Watchlist

  1. All solid names to consider. It’s no secret that I really like the large Canadian banks and hold TD, BND and RY in my ROTH. I fully contributed to my ROTH last month and have to wait till 2016 before I can add to my Canadian banks once again. Oh well. If I had to choose from the above I pick TD and RY and my 1 an 2 picks at this point. Really each has its own merit but I see those two as facing the least amount of near term headwinds as both have solid Canadian and U.S. exposure.


    1. I must say it is tough to choose. The big five each have their own appeal and talk about long term dividend streaks. I look forward to holding a few of these quality bank equities in my fund soon. TD and RY are my top two picks for now. I look forward to sharing the results of my screen soon.


  2. Hi Adam – Hard to go wrong investing in the big Canadian banks. Noticed you were across the river in Ottawa and wanted to say ‘hi’. Enjoyed your watchlist and look forward to reading more about your journey to FI!


    1. Hi DiH, always nice to meet a fellow DGI blogger. It is indeed hard to resist the stability and longevity of these big bank dividend stocks. I look forward to sharing more updates soon, including the results of my November screen. Cheers


  3. TD, BNS, and RY are three of my largest holdings (in that order). I like TD because of their growing operations in the US. I like BNS because of the fantastic dividend yield and their growing Latin American operations. RY is a Canadian juggernaut that also has growing US operations.

    Altogether, fantastic growth prospects both in terms of capital appreciation and dividend growth.


    1. My largest Canadian holdings are BNS, TD, RY. I look forward to building them all up more this year and in early 2017. Can’t agree more with your points on each one, great to see their footprint growing abroad. There was a good investment piece in the Globe and Mail recently: If you had invested $10k in RY in 1996 and reinvested all the dividends, your RY holdings would be worth $219k in 2016! Now that is a dividend snowball!


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