Weekend Reading – Canadian Bank Earnings 2024
Hey Folks!
I hope you had a great week – welcome to a new Weekend Reading edition that highlights the week that was for Canadian bank earnings to an end for the 2024 calendar year.
Those updates soon!
Before that, some recent posts on my site:
Thanks to some reader questions, I wrote about this:
And…
Last weekend, I wrote why I continue to favour dividend stocks over bonds:
Weekend Reading – Should retirees buy dividend stocks over bonds?
Weekend Reading – Canadian Bank Earnings 2024
Really a mixed bag related to Canadian bank earnings…some highlights including dividend news for each:
Bank of Nova Scotia (BNS):
- Scotiabank just reported a fourth-quarter profit of $1.69 billion, up from $1.35 billion in the same period last year.
- No dividend increase; sustained at $1.06 per share but I would anticipate one dividend increase in 2025.
Royal Bank of Canada (RY):
- Q4 earnings were $4.2 billion; up from around $3.9 billion in the same period last year.
- Royal increased their dividend by 4% to a new total of $1.48 per share.
National Bank of Canada (NA):
- Q4 earnings were close to $1 billion; up from around $751 million in the same period last year.
- National Bank also bumped their dividend this period, to $1.14 per share.
Bank of Montreal (BMO):
- Q4 earnings were $2.3 billion, up quite a bit from $1.71 billion in the same period last year.
- BMO also raised their dividend this period, by 3%, to $1.59 per share.
CIBC (CM):
- Q4 earnings were $1.88 billion, also up quite a bit from $1.49 billion in the same period last year.
- This boost suggested to the CM Board they should (and they did!) boost their dividend by almost 8% to $0.97 per quarter.
TD Bank (TD):
- TD did well to post higher earnings, $3.6 billion this quarter vs. $2.87 billion in the same period last year.
- This is despite many lingering issues; namely a U.S. footprint that has a cap of assets; restricting growth along with being disqualified from acting as an investment adviser or underwriter for investment companies in the U.S. Geez.
- For these reasons, I still find it very surprising the Board increased the dividend this period, up 3 cents per share from $1.02 to $1.05.
Not to be finished, I also own a growth bank: EQ Bank. (Canada’s Challenger Bank™)
EQ Bank / Equitable Bank (EQB):
- EQB generated record earnings in Q4, but results were tempered a bit due to credit provisions in its equipment financing portfolio, including one particular / major credit exposure.
- Adjusted revenue in Q4 was $321.6 million fuelled by higher customer growth.
- EQB increased their dividend again this quarter, to $0.49 per share (up 2 cents) and up a whopping 23% year-over-year.
Disclosure: I own all banks above and have done so, in some cases, for well over a decade now.
However, not everything is roses in my portfolio.
Year to date, my remaining/lingering BCE stock is down and it will likely remain down in price into 2025 until the dividend is cut. Yes, they should cut the dividend. (I’m not sure what the Board has been thinking.)
Thankfully, I don’t own very much Bell Canada stock (next to nothing as of early 2024 and today) since I’ve divested almost all BCE shares over the years into what I believe are better stocks and/or simply low-cost ETFs for growth simplicity. When BCE does cut their dividend, well, my thinking is the price should rebound after a few months. It’s largely priced in. The market knows this. Cutting the BCE dividend from this so-called “orphan and widow stock” would be a good sign the Board along with management has finally seen the simple writing-on-the-wall. Time will reveal all though.
As disappointing as BCE has been over the last few years for many DIY stock investors who went heavy on yield, hopefully those same DIY investors have also considered loading-up on lower-yielding, higher growth performers that include but are not limited to Brookfield (BN) or Waste Connections (WCN). Both stocks are up nicely for me since the pandemic ended and through 2024 year-to-date:
- BN up 53% YTD and up about 90% over the last 5-years; adjusted for the BAM to BN spinoff. Recall BN is the parent company to Brookfield Asset Management (BAM) and the shares Bruce Flatt, CEO owns. At last check, Bruce Flatt owns about $3-billion of BN shares. Nice. 🙂
- WCN up 28% YTD and up about 108% over the last 5-years.
Source: Google Finance.
I haven’t done a Then and Now post about Brookfield but I might at some point. Here is the one about WCN.
I will continue to own both BN and WCN along with all Canadian banks above as part of my hybrid investing approach as I buy more XAW in registered accounts as well.
You might recall I shared some of those names and more in this Canadian Compounders edition.
Other stocks I own are also WAY UP in 2024 so I’ll share some updates in a Year In Review post that I’ve been thinking about writing in a few weeks. All individual stock investing has risks. BCE has gone from a great income to hold for a bond-proxy to a dud. Higher-yielding stocks and the dividends they pay present risks. While I continue to get paid from many of the stocks I own, I also want gains from my portfolio as well as I march towards semi-retirement…
Maybe all those stocks listed will go higher or come down in price by then – who knows?!
Back to Canadian banks, what’s your take? More growth to come? Which ones do you own and why? Are you buying more TD Bank or other banks that might be struggling?
More Weekend Reading – Beyond Canadian Bank Earnings 2024
Here are some other reads I’ve found from this past week, for your reading enjoyment:
John Heinzl from The Globe and Mail sold all his BCE shares in his personal portfolio and in his model dividend portfolio as well (subscription). From his article, thoughts on the pending dividend cut:
“Given BCE’s pledge to maintain its dividend through 2025, analysts don’t expect a reduction immediately. But longer-term, maintaining the dividend while reaching BCE’s payout ratio and debt leverage targets could prove to be challenging.
“We now assume a 25-per-cent dividend cut in 2026, to approximately $3.00″ per share, TD Cowen analyst Vince Valentini said in a note this week. That would represent a payout ratio of about 93 per cent based on TD Cowen’s estimate of BCE’s free cash flow in 2026 and a yield of about 7.9 per cent based on the current share price.
BCE’s shares closed Friday at $37.94 and are yielding about 10.5 per cent based on the current dividend rate. Such a high yield indicates that investors are skeptical that the dividend will be maintained at current levels.”
According to wealth manager BlackRock, investors should rethink the traditional 60/40 stock and bond portfolio.
(On Wednesday this week, BlackRock released its 2025 Global Outlook, hinting to be more dynamic with any portfolio.)
Also from this article, when it comes to owning U.S. stocks and the BlackRock report:
“The authors of the report said they view the U.S. as “standing out” compared to other markets due to higher growth and an ability to “capitalize on mega forces” that are driving corporate earnings.
“We up our overweight to U.S. equities and see the AI theme broadening out,” the report said.
The report noted that one of the mega forces, driving enthusiasm for U.S. equities is AI.
“We think the AI mega force will benefit U.S. stocks more and that’s why we stay overweight, particularly relative to international peers such as European stocks,” BlackRock said in the report.”
At the time of this post, I continue to own $0 bonds in our personal portfolio. I wrote about bonds again in May 2024 and reaffirmed by position.
How I’m safeguarding my income plan!
Sorry for the delay, but the TD YT page has been updated and my webinar on this subject is now ready to view for free!
As always, I look forward to your comments and feedback, including any subjects I should discuss in my next webinar with them / TD in 2025. Let me know!
Have a great weekend!
Mark
Hi Mark: They haven’t cut the dividend yet and even the analysts predicted a dividend drop from $3.99 to $3.00 so not cut in half and so just a reminder that it hasn’t been cut yet and the company says it is only going to pause it. As mentioned before if the analysts had not dropped the stock price by over 10 points then it would be yielding 8.2% instead of 10.5%. It appears that companies must first inform the analysts before they decide to make any deal as to not shock the market. The last line is a bit of sarcasm but well deserved. Most of this is just noise so read it and make up your own mind and don’t take the analysts view as gospel. Will BCE drop off the board? If not then make up your own mind if is worth the risk. As BCE is much bigger than Algonquin Power then I personally have decided to take the risk and to look at it as an opportunity to buy on the low side and to add to my position. I don’t buy high stocks that don’t pay me anything. I prefer to get paid while I wait.
Great stuff. It will be great to compare notes with BCE long-term. Yes, you will get paid to wait. 🙂
Mark
Morning Mark,
I’ve recently read this article re maximizing TFSA contribution room moving forward: https://www.thestar.com/business/personal-finance/use-this-win-win-tfsa-strategy-before-jan-1-to-maximize-earnings-and-grow-contribution/article_f8df7722-ae7f-11ef-b76e-3f6c7e07d7d7.html. I’d never thought of doing this but have some reservations. It seems by cashing out “gains”, I would indeed have “saved” that contribution room if my investments decline; however I also would want to re-invest in the New Year and have to pay a much higher price than I did originally. What do you think? Is it worth it to do so?
Thank you for you ongoing excellent articles. I enjoy your writing very much and have learned a lot over the years reading “you”. (<:
It is an interesting strategy, I couldn’t read/see the entire article due to paywall but I think I get the idea – strategic withdrawals/withdrawals in December to give back TFSA room in the next year.
I haven’t done that myself. Buy and hold inside the TFSAs. I’m down to a handful of banks, a few utilities and some pipeline stocks for a blend of income to go along with some growth inside both TFSAs via low-cost XAW. Very boring stuff we own.
https://www.myownadvisor.ca/whats-in-your-tfsa/
That said, I can appreciate the selling in December strategy to avoid keep any “down” stocks or ETFs. The same thinking would apply to taxable investing and selling stocks to offset gains during the year.
Thanks for the kind words and I appreciate your readership!
Happy investing in 2025 to you!
Mark
Hi Mark: As stated if the analysts hadn’t dropped the stock 10 points from were it was trading then the stock would be trading for 8.2% and not 10.5%. Still high but less then were it is now. I am well aware that analysts can talk a stock down but that doesn’t mean that they are right. In analysts upgrades and downgrades I find some of their reasoning odd and kind of funny too. Sometimes a company will make a miss but the analyst will say it was expected and raise the rating and other times a company will make a huge profit but the analyst will drop the rating and say that future profits don’t look so good so most times you have to use it as a guide and make up your own mind. The company doesn’t cut the dividend and they have said they will only pause it then I can sit on it and collect the 10.66% in my case. As for BCE an BN *I will sit on both as I will have 12000 shares of BCE and 12187 shares of BN. Both are catching up to ENB at 21000 shares. Yes I have done this before and got burned. the stock in question was Dome and I bought the preferred. The purchase price was $16.00 and when I sold it it was $2.84. Not a nice feeling but with BCE I don’t expect it to drop off the board so should be safe I don’t like the drop in TC Energy but between it and SOBO the 2 dividends will be more then the last dividend for TRP. Those are my reasons as companies don’t like to cut dividends as this could lead to a downward spiral which the company does not want to see but they want to save money so a pause does not seem as bad as a cut. Not raising the dividend saves the money they would have sent out if they had raised it. The analysts are feverish for a cut since it is their idea. Like I said, different strokes for different blokes. Everyone is entitled to their own opinion and this is mine.
Ronald, that blows my mind. 🙂
You own 12,187 shares of BN??
You still own 21,000 shares of ENB??
Wild. Amazing.
Ya, I hear you on the BCE. If you have 12,000 shares of BCE, that’s a lot but if you are OK with the dividend dropping bt 50%, well, so be it. All good. Just a risk I see and some opportunity costs for us since we don’t want to own many stocks that cut their dividend.
BCE might be the exception that we continue to own a few shares in for now….we’ll see. BCE is well less than <1% of our total portfolio.
Yes, true, “…analysts are feverish for a cut since it is their idea” but I also think BCE is in trouble if they pay out more money continually than they make! 🙂
Mark
Mark,
Thanks for this article. As a buy and hold investor with a good dose of Canadian banks, I enjoyed this week and enjoyed recalculating my yield on cost. I have no plans to sell, not even TD (they will recover, and, I feel people have short memories). On BCE, I have a small position and I am underwater, like I am with AQN. No plans to sell anything at this point. Keeping a loser or two in my portfolio serves as a reminder and keeps me humble.
CJ
Good stuff, CJ, and no plans to sell any Canadian banks here either.
Onwards and upwards for you.
Mark
Hi Mark: first the good news. Yes Brookfield is a great company and I have had it since ’99 when it was called Brascan. It seems that Bruce Flatt likes it too as in shares and DSU’s he is roughly worth $7492020549.50 in
BN and BAM so I don’t think he is missing many meals. Don’t do much to your portfolio because most stocks are to high to buy. On BCE maybe I’m a contrarian because I just bought 2000 shares. I’m not scared by the drop and speaking of drops what causes a stock to drop 10 points in one day. The analysts didn’t like the direction the company took and though buying Zipley the analysts thought that the company would take the money from their portion of MLSE and pay down debt and use the money to find companies to buy in the states. After they drop the stock it now yields 10.5% and now they say you have to cut the dividend because the yield is too high but before they dropped it it was yielding about 8.2%. Still high but not as high as 10.5%. Analysts are not always right. Earlier this year Enbridge posted a 2 fold profit But the analyst dropped their price target because the company missed their estimate by a cent Do you see the reasoning there. I look at it and say a 2 fold profit is real while an estimate is well an estimate. For buying a company in the states I don’t blame them one bit after all here in Canada they are continually getting kicked in the teeth by the government via the CRTC. As noted before now is a time to sit on cash and wait for a buying opportunity.
Ron!
Hi Ron!
Ya, only happy to buy more BN if and when I have the money to do so…I own some BIPC and BEPC as well.
As for BCE, I just don’t see how 10%+ yield is sustainable. I really don’t. The dividend will get cut in 2025, or at the latest 2026. If and when that happens, I do believe a 50% dividend cut should raise the BCE price again. I don’t own very many shares at all now and don’t intend to.
Your bold purchase is impressive. I would definitely like 2000 shares in BN vs. BCE. 🙂
Mark
Hi Mark, thanks for the overview as always there is always a lot to ingest.
My take on all of this is that it’s a mixed bag at best with increases sitting at the bare minimum. CM’s 8% is good but they have been a dog for some time. RY is okay EQ is the only real bright spot goes to show that like most industries we need way more competition. The other majors all are lethargic and all are having trouble growing both domestic (no GDP growth, capped immigration) and beyond once they leave the sheltered waters of Canada. I appreciate the sentimental value put on our banks and the good run they had this year but at this point in time I do not consider them great investments for me. You know my position on Canada vs, US.
I expect more of the same okay-ish results going forward. They are not going away and given they control 90% of the market they will make a ton of money don’t get me wrong. As an income focused investor a 5% yield and 3% dividend growth is not what I’m looking for. I still hold both TD and BNS be it the positions are being trimmed. I prefer to hold all banks (and lifeco’s) in a >15% yielding CC ETF I take my 10% income and reinvest 5% to beef up my capital & income over time and I’m good.
I don’t have a great deal of confidence in BCE, have been trimming my position and will exit early next year. I don’t see anything but a 50% cut as being realistic/useful but I am also hesitant to see them being successful in the US. Long term they might be okay but I’m not going to hold my breath for the 5 plus years it takes for them to get their act together. Wrong strategy imo not a fan of the BCE’s MT.
Ben I’m intrigued…can you enlighten me on “a >15% yielding CC ETF”?
Oh i think you are referring to a covered call ETF but want to understand your process and thinking 🙂
Hi Louis,
ETF in question is BANK.TO, holds 10 of the largest FIN companies; 6 banks and 4 LifeCo’s basically everything one wants to own in Canada. It’s index based (no picking involved) but actively managed with yes covered calls. BANK yields ~15% made up by regular dividends, option premiums and 25% leverage, so on the high side and with a little bit of extra risk. Other options exist with a different risk/return profiles. I look at total return minus a 8-10% which I use for retirement income the rest is reinvested. If you invest in covered calls reinvesting a portion of the income is strongly recommended. I also do not intend to sell shares to cover my income requirements.
The alternative is holding all individual stocks which is not a viable option for me plus I don’t like the yield and yield growth that is offered. Historically div growth was good at 6-10% I do not see that happening again any time soon. With BANK I’m diversified and get my 10% yield plus 5% yield growth. Or I can take 8% and reinvest 7%, this way I have optionality and I’m not depending on boards of directors setting my pay increase.
Hope this makes sense.
Ben
thanks Ben
I’m recently fully retired and am 80% in equities and 20% in etfs. I am looking to boost my savings rate a bit and deliver a steadier monthly income to supplement CPP once im old enough to take it and this looks like a solution for a small disposable portion of my nestegg.I like the idea of optionality and using the funds as you indicated with a portion for yield and some reinvestment. I am okay with some risk as that got me to where I am today, I do appreciate the insight as I have been looking for something like this. I already have some of my excess funds in EIT.un and AP.un so i understand risk. thank you
EIT is the godfather of income investing in Canada a great fund I’ve had it for many years total return>100%.High income + appreciation!
My apologies if this is old news but I thought I’d mention this. If you are looking at covered call etf’s note their call strategy, ie BANK does OTM (out of the money meaning a % above trading price) calls up to 33% of the portfolio meaning there is room to capture some of the upside. This varies between products and providers.
Ben
Ya, EIT has been good overall, but the challenge I see with yield and growth is you cannot have lots of both sustained = very difficult, that’s all.
Good call on sharing the nuances; totally agree Ben – thanks: “This varies between products and providers.”
I also don’t have great confidence in BCE. Yes, it will turn around eventually but I have no idea when. Management and the Board have certainly done a terrible job for shareholders.
I believe all Canadian banks go through cycles. This is why I own them.
I think the challenge with a covered call ETF is the upside. If you look at the total return of most CC ETFs, due to leverage, etc. you are not getting any growth. I love income too but I also like growth in my portfolio too – a blend is what I am / have been seeking for many years now. I can appreciate everyone is different though.
Thanks for your comment!
Mark
Hi Mark, I hear you and hear that a lot. It happens and it is good to be critical for sure but is not universally true I have price appreciation on most of my CC ETF’s. Where I don’t there are issues with the underlying holdings (for me telco and healthcare related) .Agree long term they do underperform relative to stocks they are not growth vehicles it’s a trade off. I compared a bunch of ETF’s to illustrate the point. I hope they work. Really these are more Equity/Bond hybrids imo. and Bonds no bueno.
CA Price
https://seekingalpha.com/comparison/new/MSUyQ2JhbmslM0FjYSUyQ3hpdSUzQWNhJTJDZXRzeCUzQWNhJTJDeGJiJTNBY2E=
CA Returns
https://seekingalpha.com/comparison/new/MSUyQ2JhbmslM0FjYSUyQ3hpdSUzQWNhJTJDeGJiJTNBY2ElMkNldHN4JTNBY2ElMkNoZGl2JTNBY2E=?metric=totalReturn
US price
https://seekingalpha.com/comparison/new/MSUyQ2lzcHklMkNncGl4JTJDc3B5dCUyQ3NweQ==
US returns
https://seekingalpha.com/comparison/new/MSUyQ2lzcHklMkNncGl4JTJDc3B5dCUyQ3NweQ==?metric=totalReturn
I hold ISPY on the US side with no complaints, however to your point if you look at SPYT its profile is quite different. So results vary and this is not for everyone. The provider maters, the underlying, strategy and execution maters. Back testing these maters. Some are really solid options for income investors some are certified dumpster fires, no different than stocks really.
There are ETF’s that make the SP500 or NASDAQ look like they’re flatlining and some that do the opposite. You have to check under the hood.
There is some maturing going on as strategies are being finetuned I suspect they will get it right more often. It’s a >$18B AUM market in the US alone so clearly it’s meeting a need and enough $$ is involved to make it work. Not everyone has a multi $M nest egg and can live off a 4% Buffet style strategy but everyone should be able to retire before they check out and still eat.
Besides the obvious don’t do this with your whole portfolio I think a key part that is overlooked (also by the yah sayers) is that you have be prepared to reinvest some of your income back into the portfolio. So anything beyond my income needs is reinvested this is how I grow capital (and income). If I get say a 30% yield I take out 8% and reinvest 22% back into the portfolio. This is not that different from dripping your i.e. TD dividend income except I can’t take out my 8%.
You did a bang up job on our Banks any thoughts on our Lifeco’s? I personally feel they have more upside vs the Banks MFC has been tearing it up this year.
Thanks!
Ben
I would agree with that, Ben.
“…Not everyone has a multi $M nest egg and can live off a 4% Buffet style strategy but everyone should be able to retire before they check out and still eat.”
And, to your point, using CC ETFs is / should not be an all-in approach – I would absolutely agree – you do not do this with the entire portfolio. I don’t have any CC ETFs at all but yes, I know some DIYers do. 🙂
I own some key lifecos like MFC, SLF and GWO and have done so for >10 years each. No plans to sell any, just own and let them returm what they will = mix of dividends and some growth.
I expect growth from my portfolio from BN, WCN, CNR and a few others, along with XAW and QQQ in our portfolio.
I don’t expect much growth from banks, lifecos, utilities or pipes that we own; more income/bond-proxies vs. growth.
Cheers!
Mark
As I had mentioned previously, Bank Earnings Week used to be more fun when we held the banks individually. I know it’s mostly in my head, but there was a bit of a thrill seeing each dividend increase directly impacting the total future income. Now I have to wait to see how much these increases affect the ETFs distributions. ( I acknowledge this is pretty petty). 🙂
As to the TD announced increase, I note it is substantially less than their previous annual increases. Unless they are switching to a semi-annual increase program? Somehow I doubt it.
And lastly, one hopes that a government doesn’t react negatively to these increases. They’ve done it before and seemed to have few negative repercussions. Wouldn’t put it past them to invoke the “suffering masses” tale of woe in order to get their sticky fingers on some of these funds.
Well, Lloyd, I recall you’ve “won the race” so no point in taking on more risk than you need to for any retirement income, while in retirement.
TD would be best not to increase dividends and simply get their financial act together. Seems their priorities are off, as an outsider and shareholder.
Mark
Hi Mark,
We haven’t been able to add anymore shares to the financial sector since 2021. This sector (as a group) including our insurance companies has done so well for us since then. Just over 23% allocation in the non-registered account.
As for BCE, just added more shares earlier this week. I’m well aware there’s talk of a possible dividend cut but I’m pretty lousy with future predictions, so I personally don’t even try. I just buy them when they are cheap and let my management teams have free rein to do what they think is best. Sometimes this has failed but more often than not, it’s much ado about nothing. Found that out by buying the Canadian pipelines in 2020, when the dividend yields went very high. Even bought more shares of TRP in 2023 when it was in the doghouse. All four have been doing well for us since. When Warren Buffett was also spotted buying pipelines in 2020, that was the catalyst that cinched the deal for us to buy more of our own.
Have a great weekend.
Oh, interesting, you bought more BCE? Registered or non-reg?
BCE is now a very small portion of our total portfolio after I have sold a bit here and there over the last few years and put that money into other stocks and some XAW inside our registered accounts.
There is certainly a case to be made about buying more BCE now, if the dividend gets cuts which it should in 2025 sometime, then more shares now and then likely a price “bump” after the dust settles.
I own a few pipes such as ENB, TRP, PPL in our portfolio. Do you own the same ones?
We’ll see how all this BCE dividend stuff shakes down!
Have a great weekend back,
Mark
BCE is located in our non-registered account Mark. There’s a 2.5% allocation in there. Our first dividend paid from BCE was for $40.50 in 2009 and the latest quarterly dividend paid in Oct. of 2024 was for $721.19 so of course I really have nothing to complain about.
Of course we’ll also have a little BCE in our two global ETF’s in the RRIF’s and TFSA’s (ZBAL and XDG) but not worth talking about.
As for pipelines yes we have ENB, TRP and SOBO, and PPL, but also KEY. Our only fail was IPL in 2020. That’s all we have in our energy sector.
Makes sense, re: all BCE in taxable. Same here. No BCE exists in our RRSPs, TFSAs, etc., especially since TFSAs are designed for growth with nearly 3,000 shares/units of XAW there. That’s had a nice run for the last few years.
Good stuff on the pipes. I don’t own KEY at this point but never say never. 🙂
Mark
I also own all 7 of the big banks and have for years as they have consistently delivered. Although I like to keep a single investment under 5% of my portfolio, RY has managed to surpass that slightly – which I’m fine with. Re: TD – I had increased my position (almost doubled it) back in May when it had “dipped” to $75. I’m still hopeful they will get out of this AML mess but it will be a long road – which is fine – as all my bank stocks are long-term holdings for me. We shall see!
Ya, I have the same 5% rule per se = no single stock worth more than 5% or so of the portfolio, although RY is inching higher in my portfolio!
TD has some work to do for sure. I am confident they can figure it out and improve but BCE was thought to have a fairly competent management team once too. The financial future with individual stocks is always a bit cloudy – hence the need to spread your $$$ around in many individual stocks or when in doubt, just buy some indexed funds for the build-in diversification they can offer.
Choices, choices!
Mark
Great stuff Mark. I continue to hold the big banks as well as many of the stocks mentioned above. From a contrarian standpoint, do you potentially see BCE as a stock to scoop up some shares of at its current priced in discount. Even as a 7.9% dividend payer it seems like a buy for a small percentage of a persons portfolio (given a 2% reduction in drips as well) at the current priced in threshold. Do you think you will stick around and see or rather close your position like AQN?
Gosh, not sure. I’m not buying BCE now here. Holding the very small portion we have but I go back and forth on the final sale button to be honest.
I am happy with the decisions I’ve made in recent years: more XAW, more BN, more CNQ, etc.
TOU that I’ve purchased including this year is bouncing around of late but this too shall pass and I believe energy will come back at some point, potentially roaring. I just don’t know when!
That’s the challenge with individual stocks, always some risks related to buying prices, holding periods, etc. My when in doubt purchase in recent years is XAW and that ETF which owns >60% U.S. stocks was up 18% in 2023 and is up up close to 27%-28% in 2024. That’s a good hedge for me vs. individual stocks just in case.
I wish I could predict the future!
Have a great weekend,
Mark
Nice,
I loaded up on XAW at the start of the year after looking at it per one of your articles and retiring and already am overweight (by your standards) on BN and ENB and I too bought more CNQ and FTS…dividends are my jam lol 🙂
Ha. Good stuff. XAW is an easy way to invest beyond Canada as you know and get global returns. The last couple years have been bonkers and I can’t see global stocks returning 20% on average per year – it’s not sustainable but I have enjoyed the recent gains.
Yes, happy to own BN, ENB, FTS, CNQ and others for a blend of income and growth in Canada. All good.
Onwards and upwards for you, Lou!
Mark
Mark – did you try holding BCE and selling covered calls at/slightly in the money on the way down? Collect div + call premium.
Sadly I was just about to sell BNS covered call just before earning report..got busy elsewhere and missed picking up $1+ per share over a couple days
I have thought about that, great question.
Upon thinking about your question, I would rather simplify my life as I get older though = no covered calls, instead more stock concentration than what I have (maybe eventually down to 15 stocks?) and then beyond that more ex-Canada ETFs or sector-ETFs like QQQ for the long-haul.
I’ll keep you and other readers posted on my plan but my overall approach as a hybrid investor is not very likely to change, only the subtle mixes of what I own to deliver both income + growth for semi-retirement around the corner.
Mark