The Globe and Mail attempts to identify small-cap dividend payers in its Tuesday, edition. The Globe's Tim Shufelt writes in the Number Cruncher column that the market has been offering income
investors few alternatives
in this era of low rates.
With fixed income markets
generally offering miserly yields,
dividend stocks have served as
substitutes in generating income.
However, Canada's largest dividend
stocks are closely scrutinized by
the domestic investing community.
So Mr. Shufelt went looking for lesser-known dividend payers
among small-cap companies.
Eligible stocks had to have less
than $2-billion in market cap,
but no less than $100-million.
Mr. Shufelt set a minimum average
dividend growth over the
past three years at 10 per cent.
He filtered for
companies with the capacity to
increase dividends in the future. The payout ratio had to be less
than 50 per cent.
Since excessive debt can limit
the prospects of future growth,
he also looked for companies
with reasonable debt loads. He capped long-term debt to equity
at 50 per cent.
Stocks meeting Mr. Shufelt's criteria are Dorel Industries, Canyon Services Group, Nevsun Resources, Canam Group, Enerflex and Callinan Royalties.
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