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Canadian All-Star Stocks: Dividend Increases - Week Of June 8

Published Fri, 05 Jun 2020 16:21:14 -0400 on Seeking Alpha

Canadian Dividend All-Stars are companies that have raised dividends for at least five consecutive years.
Laurentian Bank became the latest All-Star to cut the dividend.
Only one All-Star, Andrew Peller, is expected to raise dividends this week.
We are in the tail end of the most recent earnings season, and dividend growth has been virtually non-existent - at least here in Canada.
Since the last update, Canada's banks reported earnings. Typically, it would have resulted in dividend raises from the Bank of Montreal (BMO) [TSX:BMO] and the National Bank of Canada (OTCPK: NTIOF) [TSX:NA].
Although the lack of a raise may have disappointed investors, it was expected. At the height of the pandemic, the Office of the Superintendent of Financial Institutions ("OSFI") requested that the banks not raise dividends during these difficult times.
It is also for this reason that Equitable Group (OTC:EQGPF) [TSX:EQB] also kept the dividend steady after six consecutive quarters of increases.
Laurentian Bank (OTCPK: LRCDF)[TSX:LB] was also on the same bi-annual raise pattern as the Bank of Montreal and National Bank. However, the regional player made waves when it announced a 40.3% cut to the dividend.
It is a notable development as it marks the first time a Canadian bank has cut the dividend since National Bank cut in the early 90s. Is this a warning sign for the other banks? Not in the least.
Laurentian was already struggling. It is the only bank with a unionized workforce and it was recently embroiled in a mortgage scandal. To make matters worse, it is undergoing a significant digital transformation that is driving up costs. Bottom line, this was a bank struggling pre-COVID-19 and is not a precursor to future cuts by Canada's other financial institutions.
Outside of banks, the pace of dividend cuts and suspensions has slowed. That is the good news, the bad news is that there are now over 80 TSX-listed companies have either cut or suspended the... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
BANK OF MONTREAL 72.60   10.2 7.15 3.10 4.33
MOLSON COORS BREWING 56.25   13.6 4.13 2.28 4.03
LAURENTIAN BANK OF CANADA 34.05   0.0 0.00 0.00 0.00


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