Thursday, 11 September 2014

Recent Buy! September 2014

    Today I was able to add another solid Canadian dividend paying company to my portfolio. I pulled the trigger and bought 20 shares of Suncor (SU) for $43.10. This adds $22.40 to my yearly dividend income, at a yield of %2.6 and represents 7% of my portfolio. As I explained in my recent watchlist post, Suncor is Canada's largest energy company with a market capitalization of over 63 billion!

    I feel pretty good about this buy, since I was working today and not much access to my brokerage
account I managed to put in a limit order on the stock during my morning break. At the time Suncor was trading at around $43.35 but it had opened lower and was also down quite a bit the previous day due to lower oil prices announced the previous day. With that in mind I set the limit order to $43.10 with Suncor's fluctuating price in mind. When I went for lunch I was quite pleased to see that the order was filled and that the stock had subsequently risen higher than my purchase price! Always nice to indulge in a little instant gratification.

    However, had I gone on my lunch break and the order wasn't filled and Suncor was trading at $44 I still would have bought it since I am not a day trader and am acquiring solid, dividend paying companies for the long term. At the moment my 20 new Suncor shares will pay me $5.60 every quarter, for a total yearly dividend income increase of $22.40! Better yet Suncor has been raising its dividends very consistently, so in the long term my income from them will rise over time. An additional perk for me is that Suncor's quarterly dividend is paid out in months which none of my other quarterly paying companies payout, which helps to smooth out the portfolios income. Consistency is never a bad thing in my books!

    With the addition of Suncor, I've now updated my portfolio page to reflect it.

I would also like to note that if I could with more cash to invest I would probably also go ahead and have bought Manulife Financial (MFC), perhaps next time with some fresh research :)


  1. Wisp,

    I like SU. I took a decent look at the company not long ago for Daily Trade Alert, and it seemed to be a well-run company. The dividend growth as of late has been impressive, along with the underlying fundamentals. Looks solid!

    Keep up the great work.

    Best regards.

  2. Agreed! SU's 2.6% div yield is lower than I would usually look for but its long term div growth rate more than makes up for it. And in the long term I like its prospects more than say RCI.B which may face increasing competition here in Canada if a big new entrant comes around, in which case my current Telecom holding BCE would also get hit pretty hard and combined that would represent around 15% or so of my current portfolio holdings. Overall for my situation felt this was a little bit safer for the moment.
    Thanks for stopping buy!

  3. SU should deliver shareholder value for decades to come.

    Nice call, I suspect it will be a long-term hold for you.


  4. Thanks for sharing your recent purchase of SU. Canada has many great long term dividend payers and SU is no exception. I see I own several of the large Canadian banks that you do as well, TD, BNS and RY. Good to know I have company with my holdings. Look forward to your next update.

  5. Always happy to share :) SU and oil companies I think are in for a bit of a rough ride the next little bit as oil prices seem to be declining a bit, with it at ~$94. IIRC from what I read of the Morningstar report on them, the price target was still a bit higher than SU's current pricing and that was with the assumption of oil at $90 so I am not overly worried and for quite some time oil will most certainly be needed. Looking forward to being able to do a dividend increase update for SU in the next few months as well!