Looking for investing ideas? Here’s your weekly digest of the Globe’s latest insights and analysis from the pros, stock tips, portfolio strategies plus what investors need to know for the week ahead.
Why CIBC looks like a bargain among rebounding Canadian bank stocks
Canadian bank stocks with low valuations and big dividends have been performing particularly well over the past year, and these same features could help drive outperformance in the months ahead, David Berman writes. Canadian Imperial Bank of Commerce is a standout here: The stock’s total return, which includes quarterly dividend payouts, has led its peers over the past full year with a gain of 3.9 per cent.
If that doesn’t sound like much, consider that CIBC’s Big Six peers have lagged with a total return of minus 1.5 per cent over the same period. And a shift toward value could continue to work in favour of CIBC, long relegated to the discount bin because of its perceived higher risk due to a number of high-profile stumbles over the past couple of decades. Read more here.
John Heinzl: Why I’m buying more of these two high-yielding dividend stocks
I’ve been sitting on a pile of “cash” in my Yield Hog model dividend portfolio, John Heinzl writes. Now, it’s time to go shopping. But first, brief update on the portfolio: So far in 2021, five companies in the portfolio have hiked their payouts. Canadian Utilities and Restaurant Brands International raised their payouts by 1 per cent and 2 per cent, respectively. BCE and Brookfield Infrastructure Partners both raised their dividends by about 5 per cent, and TC Energy announced an increase of 7.4 per cent.
Now he’s adding to his position on Telus and SmartCentres Real Estate Investment Trust. Telus offers an attractive dividend yield of 4.8 per cent. What’s more, the company is aiming to increase its dividend at an annual rate of 7 to 10 per cent through the end of 2022. And Like most REITs, SmartCentres has taken a hit from the pandemic. But unlike many REITs, it has maintained its distribution, which yields 7.4 per cent. Read more here.
Four ways to make a last-minute RRSP contribution if the stock market is making you nervous … and three to avoid
Rob Carrick outlines four ways to make an RRSP contribution before the March 1 deadline with an eye on managing the risk of putting a block of money into the stock market after a big move higher. One is the bullet-proof approach: Open an EQ Bank RRSP Savings Account, which is paying 2.3 per cent for now with no fees or minimum balance. Grade this option A-plus for safety. But be aware that the rate can change at any time. The strategy is to park your RRSP contribution for the 2020 tax year here, collect the 2.3-per-cent interest for as long as it lasts and then move your money when you’re ready. Read more here, including the other three approaches, as well as three investments to avoid.
Gordon Pape: My RRSP portfolio has bounced back, gaining almost 14% over the past 6 months
After taking a hit during the market crash almost a year ago, our RRSP portfolio has recovered well, Gordon Pape writes. During the six-month period since our last review in August, we gained 13.6 per cent. The Brookfield entities were the biggest gainers during the period, but we also had decent contributions from our low volatility funds and our newly added Harvest Tech Achievers ETF. Here’s a look at the holdings, their performance and revisions to the portfolio, including added positions.
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The very smart thing investors are doing more and more, even in today’s frothy market
A lot of investors are doing the precise right thing with their money today, Rob Carrick writes: buying record amounts of balanced exchange-traded funds, aka asset-allocation ETFs. A balanced ETF is a fully diversified portfolio wrapped in a single product. Available in multiple versions for conservative, middling and aggressive investors, they blend bonds with stocks from Canada, the United States and the rest of the world.
Vanguard dominates balanced ETFs. Other big players in the category include BMO ETFs, BlackRock’s iShares lineup and Horizons ETFs. Mackenzie Investments, Franklin Templeton and TD Asset Management are also players. Read more here.
What investors need to know for the week ahead
Canada’s big banks will be releasing their latest results in the week ahead, beginning with Bank of Nova Scotia and Bank of Montreal on Tuesday, followed by Royal Bank of Canada and National Bank of Canada on Wednesday, as well as Toronto-Dominion Bank and Canadian Imperial Bank of Commerce on Thursday. As banking reporter James Bradshaw writes, many investors are looking for clues to which lenders will bounce back first in a postpandemic recovery.
Other companies reporting earnings this week include Berkshire Hathaway, Home Depot, Moderna, GFL Environmental Holdings, Loblaw Cos., Nothland Power, Thomson Reuters, Bausch Health Cos., Canfor, Hydro One, Canadian Apartment Properties REIT, Boardwalk REIT, Boralex, Dell Technologies, Gildan Activewear, Enerflex, Lowe’s Cos., Stantec, TJX Cos., Atco, Cascades, Transcontinental and Onex.
Bank of Canada Governor Tiff Macklem gives a speech on Tuesday with a press conference to follow. Economic data on tap this week include: U.S. new home sales for January (Wednesday); U.S. durable goods orders and pending home sales for January (Thursday); Canada’s industrial product price index plus U.S. personal spending and income as well as its goods trade deficit, all for January (Friday).