3 Dirt-Cheap Dividend Stocks Yielding up to 6.2%

Canadians should look to snatch up cheap dividend stocks like Manulife Financial Corporation (TSX:MFC)(NYSE:MFC) today.

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The S&P/TSX Composite Index was up 66 points in late-morning trading on September 27. Canadian stocks enjoyed a rebound from the dip suffered at the end of the previous week. There is some unease present among investors and analysts right now, as central banks mull a path forward. An increase in interest rates has the potential to stir volatility in the months ahead. Today, I want to look at three cheap dividend stocks that offer nice yields. These equities are worth holding onto in this uncertain period.

Canadians should target this dirt-cheap insurance stock

Manulife Financial (TSX:MFC)(NYSE:MFC) is a Toronto-based company that provides insurance and financial services to a global client base. Its shares have climbed 10% in 2021 at the time of this writing. The stock has increased 31% year over year. This is a cheap dividend stock you can rely on for the long term.

The company unveiled its second-quarter 2021 earnings on August 4. Core earnings jumped 18% from the previous year to $1.7 billion. Meanwhile, net income attributable to shareholders was reported at $2.6 billion — up from $1.9 billion in the second quarter of 2020. New business value in Asia grew to $876 million in the year-to-date period — up from $654 million in the prior year.

Shares of this dividend stock last had an attractive price-to-earnings (P/E) ratio of 6.8. Moreover, Manulife offers a quarterly distribution of $0.28 per share. That represents a solid 4.5% yield.

A dividend stock that flies under the radar in the banking sector

Canadian Western Bank (TSX:CWB) is an Edmonton-based regional bank. However, it has recently opened a batch of branches in the eastern part of the country. Shares of this underrated bank stock have climbed 30% so far this year. The stock is up 35% from the same time in 2020.

In Q3 2021, Canadian Western delivered total revenue growth of 16% to $263 million. Meanwhile, branch-raised deposits climbed 17% to $18.7 billion. Loans achieved 9% growth to $32.3 billion across the country and had 10% growth in the province of Ontario. Better yet, adjusted earnings per share increased 36% year over year to $1.01.

What makes Canadian Western a cheap dividend stock? Its shares last had a favourable P/E ratio of 10. Moreover, it offers a quarterly distribution of $0.29 per share. This represents a 3.1% yield.

One more cheap dividend stock that offers big income

Extendicare (TSX:EXE) is the third and final cheap dividend stock I want to zero in on today. Last spring, I’d discussed some of the top healthcare stocks to target during the COVID-19 pandemic. Extendicare is an Ontario-based company that provides care and services for seniors across Canada. Its shares have increased 18% in 2021. The stock is up 44% from the previous year.

Investors got a look at its second-quarter 2021 results on August 5. Long-term-care (LTC) occupancy rose 250 basis points, bolstered by easing COVID-19 restrictions. Extendicare reported vaccination rates at 90% or above at its LTC facilities and retirement residences at the end of the second quarter. Revenue rose 9% to $307 million, and adjusted EBITDA nearly doubled from $9.7 million to $17.8 million.

This cheap dividend stock possesses a favourable P/E ratio of 11. It offers a monthly distribution of $0.04 per share, representing a tasty 6.2% yield.

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 Ambrose O'Callaghan has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

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