Amidst the rising session for the Toronto Stock Exchange, where materials and tech sectors are gaining momentum, investors may find comfort in the stability of dividend-paying stocks. In the current Canadian stock market landscape, investing in a good dividend stock offers consistent payouts to investors and resilient performance. It’s the stability most investors are after, with uncertainty looming on the horizon.
With that said, here are three dividend stocks I think are screaming buys in March. Let’s dive in!
First National Financial
First National Financial (TSX:FN) is a parent company of First National Financial LP, a Canadian underwriter, originator, and service provider of prime residential and commercial mortgages. It controls its First National Mortgage Investment Fund, which manages exposure to the economy through a diversified portfolio of primarily commercial mezzanine mortgages.
The company’s current market capitalization sits just shy of $2.2 billion, making First National a relatively small player in Canada’s financial sector. That said, with a dividend yield of roughly 6.7%, there are few banks in Canada or in North America that surpass this little-known gem.
I think First National flies under the radar, largely due to its regional focus and its smaller size. While certainly higher risk when compared to the mega-banks in Canada, First National’s dividend profile is second to none. The company has continued to generate strong earnings, and, barring any sort of financial crisis, it is a stock I think is worth owning at just eight times earnings.
IGM Financial
IGM Financial (TSX:IGM) is Canada’s largest non-bank asset manager and part of the Power Financial group of companies, which comprises London Life, Great-West Life, Canada Life and Putnam Investments. The firm has two operating divisions, wealth management and asset management, offering investment management products and services.
On February 15, IGM announced its financial reports for 2023, in which it highlighted its annual net earnings of $1.15 billion, or $4.82 per share. The company’s assets under management grew more than 7% to $240 billion in 2023, allowing the company to fund its impressive dividend yield of around 6.3% at the time of writing.
This ultra-high yield dividend stock in the financial space is another example of an overlooked company, in my view. Accordingly, for investors seeking a mix of defensiveness, value, and income, this is a top stock to consider in March.
Canadian Imperial Bank of Commerce
Canadian Imperial Bank of Commerce (TSX:CM) is the fifth-largest bank in Canada. It operates in three business segments: capital markets, retail and business banking, and wealth management. It has more than 11 million personal and business banking customers, primarily in Canada.
For the first quarter of the financial year 2024, the bank reported net income of $1.65 billion, 370% more than the first quarter of 2023. Canadian Imperial Bank of Commerce declared a dividend of $0.90 per share as well. As far as Canada’s large banks are concerned, the company’s current yield of around 5.4% is among the most attractive, largely due to the stock’s stable trading price and rising dividends over time.
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While CIBC does certainly carry higher risk levels tied to the Canadian real estate market, it’s among the more attractive options for dividend investors. Thus, this is a stock I think is worth keeping on the radar right now.
