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Having trouble finding attractive dividend stocks after the market's big run-up? Juliette John feels your pain.

A year ago, the lead manager of the Bissett Dividend Income Fund and Bissett Canadian Dividend Fund was seeing bargains everywhere she looked. But the pickings are suddenly much slimmer.

"There are fewer opportunities now, no question. If an investor is looking for short-term returns, the gains are not going to be anywhere near what we've seen," she says.

Lately, Ms. John has been trimming positions of stocks that she believes have reached full value. As a devotee of the GARP approach - Growth at a Reasonable Price - it's the "reasonable price" part of the equation that has become the biggest challenge as an investor.

That, and the fact that dividend yields - which soared during the financial crisis - have since returned to Earth as the market staged a vigorous rebound.

For all the challenges, however, Ms. John is still finding stocks she likes. And with markets heading for a possible correction as interest rates rise and the traditionally weak summer months approach, she's more convinced than ever that stocks with solid dividends - and the prospect of dividend increases - are the place to be.

We asked Ms. John to discuss some of her favourite dividend stocks.

TMX Group

Price: $29.20

Yield: 5.2 per cent

Last Dividend Increase: Jan. 31, 2007 (15.1 per cent)

This may sound like an odd choice, given that TMX - which operates the Toronto Stock Exchange, TSX Venture Exchange and Montreal Exchange - is under attack from Alpha Group, the bank-owned alternative trading system. Having already taken direct aim at TMX's trading and market data services, Alpha is now seeking regulatory approval to launch a full-fledged stock exchange and go after lucrative listing fees.

But Ms. John says TMX's out-of-favour stock is attractive for a few reasons. For one, it's no slam-dunk that Alpha will win exchange status, given the conflicts of interest that would arise because it is bank owned. For another, while TMX is losing share in cash equities trading, the ME's derivatives business is growing and should do well now that interest rates are rising, generating more demand for its products.

Reitmans

Price: $18.42

Yield: 3.9 per cent

Last Dividend Increase: Dec. 4, 2007 (12.5 per cent)

Apart from its clean balance sheet, ample cash reserves and management team focused on creating shareholder value, there's another thing Ms. John likes about women's wear retailer Reitmans: The higher the Canadian dollar goes, the more money it makes, because it sources clothing offshore.

A recovery in consumer confidence should also help Reitmans' margins, because it won't have to resort to as much discounting at its chains, which include Reitmans, Smart Set, Addition-Elle and Penningtons. After a pause of more than two years, "I think they'll likely get back into the track of raising [the dividend]regularly. From a cash-flow perspective absolutely they could," she says.

BCE

Price: $30.88

Yield: 5.7 per cent

Last Dividend Increase: Dec. 17, 2009 (7.4 per cent)

As dividend growth stocks go, BCE is in a class of its own. Canada's largest telecom company has boosted its dividend three times in the last 15 months. And while Ms. John doesn't expect that torrid pace to continue, she thinks annual hikes are likely.

New entrants in the wireless business haven't grown as quickly as some analysts expected, underlying the competitive strength of BCE and fellow incumbents Telus and Rogers (which she also owns). And now that BCE has finished upgrading its wireless network, there should be plenty of free cash flow available for dividend increases, even after ongoing capital expenditures on Bell's high-speed fibre rollout for Internet and TV.

"There will always be capital expenditures for these companies … but I think that at this point in time what's ahead of them is significantly less than what's behind them, at least from what we know," she says of Bell, Telus and Rogers.

Procter & Gamble

Price: $62.20 (U.S.)

Yield: 3.1 per cent

Last Dividend Increase: April 19, 2010 (9.5 per cent)

To consumers, Procter & Gamble is known for its stable of trusted brands including Pampers diapers, Crest toothpaste and Tide detergent. To investors, it's one of the great dividend growth machines, with 54 consecutive annual increases under its belt, including a 9.5-per-cent hike earlier this month.

P&G's stock got hammered during the recession as consumers traded down to cheaper brands, but it's bounced back as the global economy recovers. It's still well back of its pre-recession highs, however, and Ms. John thinks there's room for it to move higher.

"We think it's a company that will continue to generate very solid earnings growth through its cost-cutting platform as well new products it's bringing to market across its brand portfolios," she says.

Royal Bank

Price: $62.39

Yield: 3.2 per cent

Last Dividend Increase: Aug. 24, 2007 (8.7 per cent)

Canadian banks have been dividend growth duds since the financial crisis, but Ms. John thinks that's about to change. Royal Banks' retail operations are strong, its capital levels are high and loan losses should improve as the economy and employment recover. What's more, "they've been making headway in areas outside of Canada, primarily in capital markets as well as wealth management," she says.

"We will likely see dividend increases by late 2010, and by 2011 I would expect that all the banks will have raised dividends."

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