Thomson Reuters Dividend Increase

TRI

Thomson Reuters Corp (TRI) announced a 1.49% increase in its cash dividend. The quarterly cash dividend will increase from US$0.335 to US$0.34 per share and payable on Mar 15, 2016 to shareholders on record as of Feb 23, 2016.

Thomson Reuters declares all its financials and hence the dividends in US$ even if shareholders own the TSX-listed stock.

Thomson Reuters is a Dividend Challenger and this is the 23rd consecutive annual dividend increase. The annual dividend rate goes up from US$1.34 to US$1.36. Yield going forward based on today’s closing price is 3.91%.

“Today’s results reflect the significant progress we have made putting the company back on solid footing,” said James C. Smith, president and chief executive officer of Thomson Reuters. “With the ship now turned, we have growing confidence in our strategy as we look to 2016 and 2017.” In addition, the company announced that it plans to repurchase up to an additional $1.5 billion of its shares as it has essentially completed its third $1 billion program announced in May 2015.

Our portfolio consists of 48 shares of Thomson Reuters, which increases our annual dividend from US$64.32 to US$65.28, an increase of US$0.96.

Recent Buy – Starbucks Corp

As is customary, I document and share all my recent purchases. The stock market has had a terrible start to 2016 – with equities across the board falling. Even with that, we were not able to pick up any shares that were in our buy range – but that finally one came along last week. I had entered a couple of GTC orders and one of them got executed.

Last week, we added to our position in Starbucks Corp (SBUX) with 25 shares @ $54.80. The stock yields 1.47% adding $20.00 to our annual dividend income.

Recent Buy Decision

Starbucks has been my top pick for 2015 and 2016 and I have written a lot about the prospects of Starbucks. Its a great company that is growing fast and expanding immensely both in US and  international markets.

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American Electric Power Dividend Stock Analysis

American Electric Power Company Inc (AEP) is a public utility holding company, engages in the generation, transmission, and distribution of electricity for sale to retail and wholesale customers. The company generates electricity using coal and lignite, natural gas, nuclear, and hydroelectric and other energy sources. It also supplies and markets electric power at wholesale to other electric utility companies, rural electric cooperatives, municipalities, and other market participants. The company serves approximately 5.3 million customers in 11 states.

Electric utilities in general have seen slower sales industry-wide amid a combination of energy conservation, energy efficiency and shift towards independent power generation/natural gas usage. Coupled with the new regulations from the US government to reduce carbon emissions, electric utilities have started focusing a shift away from dirty fuels such as coal. AEP has the added threat of operating in the part of the US economy which has a big focus on the oil production. The company expects earnings to grow at a pace of 4-6% in 2016 but investors shouldn’t be surprised if it comes in at the lower end of that range. The company appears overvalued based on the valuation metrics used.

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Passive Income Update – January 2016

Welcome to our monthly passive income update for January 2016. This is part of the scorecard series where we track our dividends and other sources of passive income. We also include changes and updates related to our investments during the month – showing the growth of our dividends going forward.

Passive Income  Update

Passive income for the month of January 2016 was C$678.82. The passive income for the month comprised of US$279.63 and C$287.34 (exchange rate is US$1 = C$1.40).

Monthly Passive Income

Passive income change is 1.89% QoQ and 23.65% YoY for the month. The passive income in January achieves 7.5% of our annual goal of earning $9K.

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Why I stopped making my financial advisor rich

The following is a guest post by Mark from My Own Advisor.

Why I stopped making my financial advisor rich

I’m not sure I can put things more bluntly than that.  I’ve made a number of dumbass financial moves over the years but this one might be my biggest mistake – I used to make my big bank financial advisor rich – but not anymore.  Let me explain…

The early investing days

In my 20s, I started my investing journey with big bank mutual funds that charged money management fees close to 2%.  I simply didn’t know how much high-fund fees would eat into my investment portfolio.  For those that still don’t know what they don’t know, let me share some numbers for you.

  • Assuming $10,000 was invested for 10 years in the TD Dividend Growth – Investor Series Fund (you would have paid money management fees of about 2% over that period); you end up with just over $15,000 in the bank but paying about $2,500 in fees during that time.
  • Compare that to owning a low-cost Exchange Traded Fund (ETF) (paying money management fees of about 0.10% over the same time period); you end up paying only about $125 in money management fees – a savings of over $2,000.
  • Compare that still to owning the company (TD Bank) and not the bank’s products, the returns are even more starling. $10,000 invested in TD Bank, from early February 2006 to this year, with all dividends reinvested throughout that 10-year period and your original investment would be worth just over $24,000 today.

Here is a link to the painful high-fee mutual fund calculator so you can run some numbers and if you own TD Bank stock, they have a handy calculator to play with here.

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