Canadians can expect prices of goods and services to remain elevated for a more extended period in 2022. Likewise, economists predict multiple rate hikes by the Bank of Canada this year until 2023 to cool down inflation. Fortunately, people can counter rising inflation and prevent erosion of their purchasing power.
One of the simplest ways to create a financial cushion is dividend investing. Today, income investors can feast on massive dividends from Fiera Capital (TSX:FSZ), Timbercreek Financial (TSX:TF), and Inovalis (TSX:INO.UN). You don’t need considerable capital to produce substantial earnings, because none of the stocks trade above $11 per share.
Fiera Capital is an independent asset management firm and one of Canada’s leading investment managers. This $1.09 billion company is well positioned to be at the front and centre of investment-management science globally. Fiera’s multi-asset solutions create sustainable wealth for clients in North America, Europe, and select markets in Asia.
Management has yet to present its full-year 2021 results, although the numbers after the first three quarters of the year were impressive. Fiera reported 69.7% and 1,362.1% top- and bottom-line growths versus the same period in 2020. Its assets under management (AUM) reached $180.8 billion.
Jean-Guy Desjardins, Fiera’s board chairman and CEO, said the company achieved multiple successes notwithstanding the uncertain economic environment. Market analysts are bullish on the business outlook of Fiera, and they forecast revenue in 2022 to rise 23% to $868 million. At only $10.24 per share, the dividend yield is 8.35%.
Steady growth on the horizon
Non-bank lender Timbercreek Financial was a steady performer in 2021, with its 19.7% overall return. As of January 18, 2022, the financial stock trades at $9.68 per share and offers a 7.13% dividend. Assuming you take a $5,000 position in TF, your money will generate $356.50 in passive income.
The $781.23 million company maintains conservative loan-to-value ratios. It also lends primarily against income-producing commercial real estate. Since the loan terms are short (fewer than five years), the high portfolio turnover results in strong inflation-protected returns.
Blair Tamblyn, Timbercreek’s CEO, said stability and durability are the hallmarks of the company’s investment style. Management is confident it will achieve steady growth in the total portfolio, because of its expanded capital base and financial flexibility.
Pure dividend play
Inovalis is a pure dividend play with its ultra-high 8.38% dividend ($9.91 per share). Furthermore, you gain exposure to the real estate sector in France and Germany. This $300.03 million real estate investment trust (REIT) owns and operates office properties in the two major European countries.
According to Stephane Amine, president of Inovalis, the Q3 2021 results (quarter ended September 30, 2021) showed the resiliency of the REIT’s business model. Amine said, “Investing in European offices in strategic locations has proven itself throughout the pandemic.”
The immediate plan is to build on a solid foundation and implement an action-oriented strategic plan. Besides the clear targets, Inovalis will deploy cash, recycle its assets, and strengthen the bottom line in 2022.
Fiera Capital, Timbercreek Financial, and Inovalis are best for yield-thirsty, passive-income investors. The massive dividend earnings should lessen the impact, if not crush inflation.