Skip to main content

Craig McGee is a senior consultant at Morningstar Canada.

What are we looking for?

The country's biggest dividend payers.

The screen

I scanned the CPMS Canadian equity database for the 20 stocks with the highest value of expected total dividends to be paid in the next four quarters and the following additional criteria:

-expected year-over-year dividend growth must be positive;

-each sector was limited to no more than three stocks;

-income trusts are excluded due to the varying nature of the classification of their distributions.

Using CPMS, I backtested the strategy to apply the same rules-based approach since Dec. 31, 1985. The portfolio of 20 stocks was equally weighted and reselected each year. Intrayear, any delisted stock would be replaced with one that met the above criteria.

More about Morningstar

Morningstar Inc. provides independent investment research in North America, Europe, Australia and Asia. Its research tool, Morningstar CPMS, provides quantitative North American equity research and portfolio analysis to institutional clients and financial advisers.

CPMS data cover more than 95 per cent of the investable North American stock market. With more than 110 equity and credit analysts, Morningstar has one of the largest independent institutional equity research teams in the world.

What we found

Over the past year, this strategy has actually lagged the market, generating a total return of 24.5 per cent versus 28.7 per cent for the S&P/TSX Composite Total Return Index.

For the full period covering almost 30 years, however, this fairly defensive approach would have posted an annualized return of 13.1 per cent, soundly outperforming the index, which came in at 8.7 per cent.

Investors are advised to do their research before investing in any of the stocks shown here.

A portfolio of top Canadian dividend-paying stocks

Report an error Editorial code of conduct
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.