Recent Buy

I’m looking for companies that are fairly valued, have a decent dividend yield (3% to 6%) and have a fairly long history of paying dividends consistently for 10 years or more. However, there could be some cases for exceptionally good company or a strategic buy for a very long term.

1) Bank of Nova Scotia (BNS)

Canadian companies in particular financial ones have been on my radar since some time. They have been fairly conservative in their lending practices and at great valuations now, in my opinion. I thought of biggies: BNS, TD and RY as primary candidates and finally latched on BNS due to little better valuation and yield. The impact and fear of sliding oil prices on banks is clearly visible on the prices of bank stocks, however, it offers a nice starting price right out of the gate.

BNS has a P/E ratio of just 8.50, a nice dividend yield of 5.61% and trading at $36.00, dropping from its 52-week high of $56.26.

I added 10 positions in BNS on 1/13 at $37.00. It’ll add $20.20 of passive dividend income on an annual basis. BNS gets the honor of my first buy of 2016 🙂 a tumultuous  year so far,  to say the least.

Full Disclosure: Long on above mentioned securities.

Thanks for reading.

What do you think about this buy?

7 thoughts on “Recent Buy

    1. Hi IH,

      Absolutely. BNS is a great buy now and we will be happy campers 🙂 I plan on adding this Canadian jewel along with few others.

      Thanks for stopping by and commenting.

  1. I just added to my BNS as well. One of my first buys in 2016. I knew I’d be reading many more Canadian banks buys as they all got hammered at the start of 2016. Seems like many bloggers are adding to their TD, BNS and RY as good price, value and yield are offered.

    1. Hi DivHut,

      Could not agree more on these Canadian banks. The prices are getting really fantastic along with the yields. Its fear of energy market and potential bankruptcies that could have an impact on the bottom line of these banks. Once oil price recover, so, will these banks. Its nice to collect these yields and wait for prices to come back.

      Thanks for stopping by and commenting.

    1. Hi DivGro,

      Appreciate liking the post and kind words, thank you. These Canadian banks have been on my sight since few years but the prices were not. Now that prices have come down to reasonable levels, pulled the trigger. As Warren says: price is what you pay, value is what you get. Its important to pay right price even for a wonderful company, fair price is fair game, but, paying exorbitant price for even a great company is never a good idea.

      I look at FANG stocks and my jaw drops when I see P/E ratio close to 1000 or few hundred. We all know what happened when it last occurred in year 2000. The market is still over-valued in my opinion and it still has more slide to occur, however, its a good time to start nibbling on these Canadian banks. Wish you best for your investment as well, bud.

      Thanks for stopping by and commenting.

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