The Motley Fool

2 Top Dividend Stocks to Buy in October

Growth from coins
Image source: Getty Images

September’s been a tough month for the markets as concerns surrounding the coronavirus pandemic are re-emerging and people are worried that a second wave is inevitable. October may, unfortunately, fare no better, and that’s why now is a time for investors to start looking at more value-oriented investments in order to keep their portfolios safe. And the two stocks listed below could do very well as they’re both set to report their earnings during the month:


Rogers Communications Inc (TSX:RCI.B)(NYSE:RCI) is down around 18% year to date as businesses have cut back on ad spending. And it doesn’t help that sports leagues were out of action for multiple months in the early stages of the pandemic. But with things starting to get back to normal, Rogers should see some better numbers when it reports its earnings in October.

When the company released its second-quarter earnings in July, sales of $3.2 billion were down 17% year over year. That was for the period ending June 30. But with the NHL and NBA sports leagues back up and running in August, Rogers will likely see its media segment perform better than it did in Q2 when its revenue was cut in half. With people staying home amid the global pandemic, watching sports is one of the few ways they can resume some sort of normalcy in their day-to-day lives.

And with more people travelling in the summer months and using their data plans, Rogers other segments should also get a lift when the company reports its Q3 results.

Currently, the stock is trading at just 13 times and it’s a great time to load up on it as Rogers’ stock hasn’t traded this low since the market crash in March.

It’s paying 3.9% per year in dividend but that yield could shrink if its share price gets a boost. That’s why investors may want to buy the stock before earnings come out, as it could be overdue for a rally.

CP Rail

Canadian Pacific Railway (TSX:CP)(NYSE:CP) hasn’t struggled this year as its stock price is up 22% year to date. The company did so well in its second quarter it even hiked its dividend payments by 15%. Now paying $0.95 every quarter, investors can earn a modest yield of around 0.9%. It’s not a terribly high dividend, but it can still help pad investors’ overall returns.

In Q2, CP Rail’s revenue of $1.79 billion was down 9%. But like with Rogers, this was in a period weighed down by shutdowns that would’ve kept demand for products and raw materials down. In the third quarter, activity levels should be stronger and help give the company’s numbers a bit of a boost.

CP Rail is optimistic on the remainder of the year as its recent acquisition of Central Maine & Quebec Railway expands its network and allows it to serve more customers in Canada, paving the way for more revenue growth.

CP’s stock is a bit pricier than Rogers, trading at 23 times earnings. But with much more growth ahead for the company and investors likely flocking to value stocks amid uncertainty in the markets, CP Rail looks to be a solid investment today. The company’s expected to release its quarterly results in mid-to-late October.

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 David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.