In the spring of 2019, I’d discussed how millennial investors could make moves to eventually retire with $1 million. Canadians who hope to meet this milestone will need to commit to saving and investing wisely for years to come. Fortunately, those who start early will have a much better chance of meeting their retirement goals than those who delay.
Today, I want to look at three discounted dividend stocks that are perfect for a millennial portfolio. These stocks provide instant income and the chance at solid capital growth for the long haul. Let’s dive in.
Millennials: One bank dividend stock to snatch up today
Canadian Imperial Bank of Commerce (TSX: CM)(NYSE: CM) stock rose 2.68% on August 26. Canada’s top banks have enjoyed a solid start to earnings season, and there is optimism for the financials sectors once again. Shares of CIBC have increased 17% over the past three months. The bank released its third-quarter 2020 results on August 27.
Earnings soared over the previous quarter, as CIBC and its peers were able to pull back from pouring resources into provisions for credit losses. Adjusted net income soared 182% to $1.24 billion, and adjusted earnings per share rose 188% to $2.71. CIBC declared a quarterly dividend of $1.46 per share. This represents a strong 5.7% yield.
Millennials on the hunt for value should consider adding CIBC today. The stock last had a favourable price-to-earnings (P/E) ratio of 11 and a price-to-book (P/B) value of 1.2. Millennials can also feel good about its immaculate balance sheet.
Energy is on the rebound
Canadian energy stocks have bounced back in the summer. A global economic reopening has led to improved demand for the oil and gas sector. Canadian Natural Resources (TSX: CNQ)(NYSE: CNQ) is an energy stock worth considering for millennials in late August.
Shares of Canadian Natural Resources have dropped 35% in 2020 so far. However, the stock is up 7.5% month over month. The company achieved solid operational results in Q2 2020. Liquids production rose to 922 Mbbl/d as the company continued to battle Alberta’s production curtailment.
The stock last had an attractive P/B value of 0.9. Canadian Natural Resources offers a quarterly dividend of $0.425 per share, representing a tasty 6.4% yield. Millennials hungry for income and energy exposure can snag this stock today.
How millennials can still win in real estate with this dividend stock
Soaring real estate valuations have made it difficult for the millennial generation to break into the housing market. The COVID-19 pandemic slowed activity, but housing sales and prices have roared back in June and July. Fortunately, millennials can still scoop up attractive housing stocks like Genworth MI Canada.
Shares of Genworth have climbed 16% over the past three months as of close on August 26. The stock is still down 25% so far this year. Surging housing activity is great news for Canada’s largest private residential mortgage insurer. Its stock last possessed a P/E ratio of 7.7 and a P/B value of 0.8. This puts Genworth in very attractive value territory. Moreover, it last announced a quarterly dividend of $0.54 per share, which represents a nice 6% yield. I love this undervalued dividend stock for millennials in the late summer.
