Earn Income From This Trio of Silver, Gold, and Energy

Let companies in the basic materials sector enhance your portfolio.

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The Motley Fool

With the volatility in today’s markets, it pays to investigate portfolio diversification across multiple sectors and also within sectors. In the basic materials sector, major companies are achieving returns from silver, gold, and energy, respectively. Consider these five dividend payers with growth plans in place.

1. Crescent Point Energy (TSX: CPG)(NYSE: CPG) is a conventional oil and gas producer. For the quarter ended March 31, 2014, it realized a new production record and averaged 130,580 boe/d (barrels of oil equivalent per day). This is an increase of over 12,900 boe/d and production per share growth of approximately 6% over Q1 2013.

Last year, Crescent Point continued to refine its cemented liner completion techniques. This has increased production and lowered its decline rate in the Viewfield Bakken and Shaunavon resource plays. The company has continued to distribute steady monthly dividends of $0.23 per share. This totals $0.69 per share for Q1 2014.

2. Enerplus (TSX: ERF)(NYSE: ERF) has a group of high-quality, low-decline oil and gas assets. For Q1 2014, its production volumes increased 5% versus Q4 2013, averaging 98,821 barrel of oil equivalent (BOE) per day. Enerplus’ focus is on improving capital efficiencies via increased productivity and reducing costs. For this year, its intention is to augment its capital spending by 12%, to $760 million.

In 2013, the company increased its funds flow by 17% to $754 million ($3.76/share). Canadian shareholders attained a total return of 58%, due to share price appreciation and the monthly dividend. In April 2014, Enerplus announced a cash dividend of CDN$0.09 per share.

2. Silver Wheaton (TSX: SLW)(NYSE: SLW) is the world’s largest precious metals streaming company. Forecast 2014 annual attributable production for the company is around 36 million silver equivalent ounces. This includes 155,000 ounces of gold. The expectation is that by 2018, annual attributable production will be roughly 48 million silver equivalent ounces. This includes 250,000 ounces of gold.

For Q1 2014, attributable silver equivalent production was 9.0 million ounces (6.9 million ounces of silver and 33,800 ounces of gold), versus 8.3 million ounces in Q1 2013. This represents 8% growth.

Last week, Silver Wheaton’s Board declared its second quarterly cash dividend payment for 2014 of U.S. $0.07 per common share.

3. TransCanada (TSX: TRP)(NYSE: TRP) is an energy infrastructure company. It connects energy supplies to important North American markets. The company has $54 billion in assets in its natural gas pipelines, energy and oil pipelines portfolios. TransCanada transports roughly 20% of North America’s daily natural gas supply.

For Q1 2014, it announced comparable earnings of $422 million or $0.60 per share. This is in comparison to $370 million or $0.52 per share for Q1 2013. This represents a 15% increase on a per share basis.

Earlier this month, TransCanada declared a quarterly dividend of $0.48 per common share for the quarter ending June 30, 2014, on the company’s outstanding common shares.

4. Yamana Gold (TSX: YRI)(NYSE: AUY) is a Canadian-based gold producer. It experienced a net loss in Q1 2014. This was due to weaker gold, silver, and copper prices, lower metal sales, and higher sale costs.

Mr. Peter Marrone, Chairman/CEO, said, “In the first quarter, we delivered production in line with our budget at costs consistent with the lower levels established last year. Subsequently, for the month of April we delivered a significant production increase which is a trend we expect to continue throughout the second quarter and balance of the year, positioning us well for our production this year.”

The company indicated in late April that its principal focus this year will be on attaining higher returns from a recent acquisition in Canada and the development of its Cerro Moro gold and silver project in Argentina.

In April, Yamana Gold declared its Q2 2014 dividend of $0.0375 per share.

In life, the adage is “make new friends and keep the old.” That can be true on the markets as well. Therefore, consider silver, energy, and gold in a balanced portfolio of income-earning stocks.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Michael Ugulini has no positions in any of the companies mentioned in this article. Silver Wheaton is a recommendation of Stock Advisor Canada.

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