6 Best Canadian Dividend Stocks For US And Canadian Investors

Today we go to the north of the border to find some of the best dividend stocks Canada has to offer. Each of these stocks is listed on an American Exchange as well as a Canadian Exchange, and is therefore easily bought and sold by both my US and Canadian readers.

These 6 stocks have been shortlisted for their dividend yield, a solid dividend coverage, and their current valuations based on key ratios such as Price to Earnings and Price to Book Value. A further study of these 6 ideas is sure to uncover a great investment or 2 to add to your portfolios. Please note that each stock in this list has a dividend coverage under 40%.

American readers who may be worried about the tax issues of Canadian dividend payments should keep in mind that while Canadian tax maybe withheld at the source when the dividends are paid, these can be adjusted against the US tax rate when you file your income taxes. Normally the impact is minimal and there is just simple addition to your filing that any competent accountant or a tax software can easily handle.

Banks and Insurance

Canadian banks have traditionally been conservative and strong operators and largely escaped the financial crisis unscathed. Additionally they have been great income generators. Today as the oil and commodities cycles try to find bottom, most Canadian banks have found their stock punished. It makes sense in some ways – the credit issued by these banks make these drilling and mining operations possible – and Canada is especially a resource rich country where the booms and busts in these sectors are more visible in the general economy.

This list contains 2 banks and an insurance company.

Bank of Montreal (BMO)

BMO currently yields about 4.5% and can be purchased at just 11.5 times earnings. It is a full service bank with over 1500 bank branches and serves retail as well as institutional clients. It is also one of the few available negative enterprise value stocks in the market with an EV of -33.64B.

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Disclosure: We do not own a position in any of the stocks mentioned above in the Value Stock Guide Portfolio. However if a further review finds any of these stocks ...

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