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In September 2017, I received a little over $ 100,000 from my former employer, which was the converted value of my retirement plan. I decided to put 100% of that money in dividend growth stocks.

I publish my results every month. I’m not doing this to brag. I am doing this to show you that it is possible to build a lasting portfolio in a highly valued market of all time. The market will inevitably decline, as it did in 2020. But despite these negative market movements, I continued to receive constant and growing dividends! And most importantly, I am fully invested in the market and enjoyed the market rally in 2020 that continues into the new year 2021.

Achievement in retrospect

Let’s start with the July 5th numbersthe, 2021 (before the bell):

Original investment amount September 2017 (no capital added): $ 108,760.02.

  • Portfolio Value: $ 213,422.79
  • Dividends Paid: $ 3,846.92 (TTM)
  • Average return: 1.80%
  • Performance 2020: + 20.3%
  • SPY = 18.17%, XIU.TO = 5.27%
  • Dividend growth: + 7.7%

Total return since inception (September 2017 – June 2021): 96.23%

Annualized return (as of September 2017 – 46 months): 19.23%

SPDR® S&P 500 ETF Trust (SPY) annualized return (since September 2017): 17.95% (total return 88.28%)

iShares S & P / TSX 60 ETF (XIU.TO) annualized return (since September 2017): 11.74% (total return 53.03%)

Sector allocation calculated by DSR PRO.

Why I won’t invest in oil and gas

Last month I finished my portfolio update with a mention of the oil and gas sector. With the entire industry posting a 50% return since the start of the year, it might be tempting to chase the next shiny thing, right?

The energy sector has played a role that has not seemed to be fading. If you keep up with business news, you will likely read a number of articles that tell you how the oil drum should hit $ 100 (or more) in no time. Could that happen or is it just more noise distracting you from your investment strategy?

When I look at the past 10 years, I see a lot of volatility at first, a lot of speculation, but no signs that oil and gas might be good for a dividend growth portfolio. In fact, we have had more lows than highs, which has resulted in many energy companies cutting not only their capital expenditures but also their dividends to shareholders. So if you have held energy stocks for a few years (up to a decade), you are not making a single dollar profit today.

Second, capital spending in the oil and gas industry, while down, has increased incredibly in another sector: renewable energy!

Based on this data, the supply of green electricity will continue to increase in the future. This will likely help make up for the lack of investment in oil and gas. If we can replace “dirty energy” with “green energy”, we will all live in a better world.

A few months ago I invested in Algonquin Power & Utilities (AQN.TO) for investments in renewable energy. For the same reason, I am now considering the option of investing in Brookfield Renewable Energy (BEPC.TO). I leave the oil and gas part of the energy sector to those who know better when to get in and (most importantly) when to get out.

Let’s take a look at my CDN portfolio. Numbers are as of July 5, 2021 (in front of the bell):

Canadian Portfolio (CAD)

Company NametickerMarket value
Algonquin Power & UtilitiesAQN.TO6,288.45
Diet Couche-TardATD.B.TO16,808.38
Andrew PellerADW.A.TO5,567.00
National BankNA.TO7,455.20
Royal BankRY.TO7,561.80
CAECAE.TO7,773.00
EnbridgeENB.TO8,074.15
FortisFTS.TO5,421.24
Intertape polymerITP.TO8,781.00
Magna InternationalMG.TO8,044.40
SylogistSYZ.TO5,812.98
cash register 585.46
total $ 88,130.06

My account is now + $ 300.79 (+ 0.34%) since my last earnings report on June 7ththe.

The Couche-Tard diet is picking up speed.

Couche-Tard announced its results on June 29ththe after market close. It was worth the wait, however. Couche-Tard had a strong quarter with double-digit sales growth driven mainly by higher average sales price for street fuel. Convenience has performed well on a 2-year basis and categories most affected by COVID-19, such as food, are showing positive trends. Same-store sales increased 8.1% in the US, 9.7% in Europe and other regions, and 1.6% in Canada. Gross road fuel margin of 34.45 ¢ per gallon in the US, down 10.48 per gallon due to unusually high fuel margins for the comparable quarter. The fuel margins are still above the 2019 level.

Comment from the CEO:

“We saw positive trends across the board in merchandise sales and fuel volumes as traffic returns to our locations. While fuel levels continued to be affected by restrictive measures, we have seen steady improvements in parts of the network, particularly in the US, where we are seeing a return to more normal driving behavior. In addition, despite rising product costs, we continued to achieve good fuel margins in all regions of the business. Also in this quarter, fifteen months after the start of the pandemic, our operations teams have done an exceptional job in their continued commitment to the business and serving our customers. “

Tecsys posted double-digit growth

TCS had a good quarter with double-digit sales growth. SaaS revenue increased 107% to $ 5.5 million in the fourth quarter of 2021, compared to $ 2.7 million in the fourth quarter of 2020. Cloud, maintenance, and subscription revenue increased 30% year-over-year to 13 $ 8 million in the fourth quarter of 2021, down from $ 10.6 million in the fourth quarter of 2020, performance was primarily driven by SaaS. Annual Recurring Revenue (ARRi) as of April 30, 2021 increased 9%. This means more cash flow comes in year after year. SaaS subscription bookings (measured on an ARRi basis) for the fourth quarter of 2021 were $ 3.5 million, down 14% from a record $ 4.1 million last year, but one 252% increase from $ 1 million in the third quarter of 2021.

Comment from the CEO:

“We are delighted with our record results at the end of an extraordinary year. Our performance in the fourth quarter of fiscal year 2021 and in the full year is proof of the need for truly adaptable and agile solutions. It was humbling to see our customers adapt their businesses with the help of our solutions in the midst of a pandemic. With our ninth straight quarter of record sales and several notable gains over the past year, we are poised to enter FY22 with a very strong pipeline. Our strategy of switching to a SaaS model is proving to be a home run for Tecsys. “

Here is my US portfolio now. The numbers are from July 5ththe, 2021 (before the bell):

US portfolio (USD)

Company NametickerMarket value
AppleAAPL13.436.16
BlackRockBLK12,510.82
DisneyDIS7,969.95
GentexGNTX7,877.20
LazardLAZ4,750.14
MicrosoftMSFT16,659.00
StarbucksSBUX9,772.45
Texas InstrumentsTXN9,610.50
VF CorporationVFC6,839.64
VisaV11,931.50
cash register 333.62
total $ 101,690.98

The U.S. Total Values ​​account is up $ 4,165.70 (+ 4.27%) since the last earnings report on June 7ththe.

Disney is keeping an eye on streaming services.

Updated my entire portfolio for the second quarter of 2021

Every quarter we prepare an exclusive report for members of Dividend Stocks Rock (DSR) who subscribe to our very special additional service DSR PRO. The PRO report contains a summary of each company’s earnings report for the period. We’ve been doing this for a full year now and I wanted to share my own DSR PRO report for this portfolio. You can download the full PDF with all the information on all of my holdings. The results were updated as of June 2021.

Download my portfolio report for Q2 2021.

Dividend Income: $ 511.33 CAD (-5.6% from June 2020)

My dividend payment is down 5.6% this quarter (compared to June 2020) while most of my companies have a dividend increase. The decline in dividends can be explained by currency fluctuations (Magna and Intertape pay in USD). Last year the exchange rate was 1 USD = 1.359 CAD. Today we’re at $ 1 USD = $ 1.2321 CAD.

The second reason is that I sold my UPS stock. As a result, I’m missing about $ 40 in dividends from UPS this month. I’ll be getting more dividends back in the future as Algonquin (AQN) pays a higher rate of return.

Here are the details of my dividend payments.

Dividend growth (over the past 12 months):

  • Fortis: + 5.8%
  • Bridge: + 3%
  • Magna International: -3% (currency fluctuation)
  • Sylogist: + 13.65%
  • Intertape Polymer: -4.2% (currency fluctuation)
  • Visa: + 6.7%
  • Microsoft: + 9.8%
  • VF Corp: + 37.8% (more shares)
  • BlackRock: + 13.78%
  • Currency factor: -12.69%

Canadian Holdings payouts: $ 330.08 CAD

  • Fortis: $ 50.00
  • Enbridge: $ 134.44
  • Magna International: $ 35.91
  • Sylogist: $ 52.13
  • Intertape polymer: $ 57.60

U.S. Holding Payouts: $ 147.11

  • Visa: $ 16.00
  • Microsoft: $ 33.60
  • VF Corp: $ 39.69
  • BlackRock: $ 57.82

Total Payouts: $ 511.33 CAD

* I used a USD / CAD conversion rate of 1.2321.

Since starting this portfolio in September 2017, I’ve received a total of $ 12,878.13 CAD in dividends. Remember, this is a “pure dividend growth portfolio”. as no capital can be added to this account other than dividends withheld and / or reinvested. Hence, all of the dividend growth comes from the stocks, not extra capital.

Final thoughts

I mentioned in this newsletter that I might very well buy Brookfield Renewable shares. Please note that this must not appear in my “pension portfolio” because I like the investment at the moment. I will likely be selling some assets in my Registered Savings Plan (RRSP) to complete the transaction. So don’t be surprised if you don’t see BEPC in this portfolio update later this summer!

Cheers,

Mike.

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