If you’re an income investor with cash on hand that you’re ready to put to work, then I’ve got three small caps that I think you will love. Let’s take a quick look at each, so you can determine which would be the best fit for your portfolio.
Chemtrade Logistics Income Fund (TSX: CHE.UN)
Chemtrade Logistics is one of the world’s leading providers of industrial chemicals and services, including inorganic chemicals, electrochemicals, and water and specialty chemicals.
Chemtrade pays a monthly distribution of $0.10 per unit, representing $1.20 per unit annually, which gives it a yield of about 7.2% today.
It’s also important to note that Chemtrade is a very reliable income provider; it has maintained its current monthly distribution since January 2007, and I think its consistently strong generation of distributable cash, including $1.86 per unit in 2016 and $1.79 per unit in 2017, will allow it to continue to do so for the foreseeable future.
Chorus Aviation Inc. (TSX: CHR)
Chorus Aviation is one of Canada’s leading providers of contract flying operations, engineering, fleet management, and maintenance, repair, and overhaul through its Jazz Aviation and Voyageur Aviation subsidiaries. It also owns Chorus Aviation Capital Corp., a leading global provider of regional aircraft leasing and support services.
Chorus pays a monthly dividend of $0.04 per share, representing $0.48 per share on an annualized basis, giving it a yield of about 5.35% today.
Foolish investors must note that Chorus has increased its annual dividend payment three times in the last five years, and that it has maintained its current monthly rate since March 2015. I think the company’s very strong financial performance, including its 12% year-over-year increase in adjusted net income to $0.93 per share and its 11.2% year-over-year increase in operating cash flow before certain items to $235.55 million in 2017, will allow it to continue to maintain its current monthly rate for decades, or allow it to announce a slight hike whenever its management team chooses to do so.
CT Real Estate Investment Trust (TSX: CRT.UN)
CT REIT is one of the largest owners and operators of commercial real estate in Canada. Its portfolio currently consists of over 325 income-producing properties, which are leased primarily to Canadian Tire Corporation Limited and total approximately 26 million square feet of gross leasable area.
CT REIT currently pays a monthly distribution of $0.06067 per unit, representing $0.728 per unit on an annualized basis, which gives it a yield of about 5.4% today.
In addition to having a high yield, CT REIT has a track record of growing its distribution; 2017 marked the fourth straight year in which it had raised its annual distribution, and its 4% hike that took effect in January has it on track for 2018 to mark the fifth straight year with an increase.
I think CT REIT’s consistently strong financial performance, including its 6.6% year-over-year increase in adjusted funds from operations (AFFO) to $0.919 per unit in 2017, and its growing property portfolio, including its addition of more than 1.5 million square feet of gross leasable area in 2017, will allow it to continue to grow its annual distribution in 2019 and beyond, making it my favourite of these three income stocks today.
