July 15th, 2010 
Category: 
Many investors consider dividend paying stocks an important part of their portfolio. In this volatile market, at least they can get away with profits without having to sell. Other investors rely on these dividends for their annual income since they retired. Whatever your reasons for choosing to go with dividend paying stocks are, this post will present a list of dividend paying companies giving you exposure to Alberta’s Cardium oil play.
In 2006 the government of Canada proposed new rules that will end the tax benefits of the income trust structure for most trusts. Energy income trusts will need to convert to a corporate structure by 2011.
There are 2 points you need to remember:
- There are risks associated with investing in energy companies and as such the monthly dividend is not guaranteed.
- Following the 2011 deadline, many trusts lowered their monthly distribution upon conversion to corporations.
In summary, these companies are no dividend aristocrats; they are mostly ex-income trusts with distributions that have been cut following the credit crunch in 2009 or cut following conversion to a dividend paying corporation.
Let’s start with the list of dividend paying corporations.
| Corporations | Symbol & Price | Dividend | 2012E Yield | Market Cap | |||||
| Penn West Petroleum | PWT.TO 22.11 [+0.21] | $1.08 | 4.10% | 11.99B | |||||
| ARC Resources | ARX.TO 24.32 [-0.08] | $1.20 | 4.90% | 6.76B | |||||
| Enerplus | ERF.TO 24.05 [+0.06] | $2.16 | 6.80% | 5.72B | |||||
| Bonavista Energy | BNP.TO 22.67 [-0.83] | $1.44 | 5.00% | 4.48B | |||||
| Pengrowth Energy | PGF.TO 9.89 [-0.08] | $0.84 | 6.70% | 4.07B | |||||
| Vermilion Energy | VET.TO 45.63 [+0.21] | $2.28 | 4.90% | 4.17B | |||||
| PetroBakken Energy | PBN.TO 15.24 [+0.50] | $0.96 | 4.6% | 3.90B | |||||
| Peyto E&D | PEY.TO 18.29 [-0.51] | $0.72 | 3.80% | 2.29B | |||||
| Daylight Energy | DAY.TO 10.07 [0.00] | $0.60 | 6.20% | 1.98B | |||||
| NAL Energy | NAE.TO 7.20 [-0.05] | $0.84 | 6.50% | 1.86B | |||||
| Bonterra Energy | BNE.TO 55.27 [-0.33] | $2.88 | 5.40% | 1.00B | |||||
Besides the Cardium land base each company holds, you might want to take into account the tax pools each company carries because it will shield their income for several years in some cases.
I would also ask you to push your research on the company further by checking where else it would give you exposure in terms of emerging plays. For example, PetroBakken carries significant land in the Bakken, the Cardium and a number of acres in the emerging Horn River Basin unconventional gas play. A long term holder might find these variables quiet appealing.
Finally, if you find any errors in the data or if I missed any companies out there that qualify on the list please do not hesitate to inform me by commenting or contacting me.
Related posts:
My DIY stock portfolio is overweight in Canadian oil producers for a reason. I believe Oil consumption is on the path of growth for the next decade and I intend to take every advantage possible of it:
I like the overview Mich!
Do you think some of the smaller players will get bought out by some of the bigger players post-conversion? I guess that can only be good news if you hold some of the consistent dividend-payers above; such as BNE. It should be interesting to find out how in all shakes down in the next few years.
BTW – I continue to watch DAY. More and more, I’m liking it for my TFSA in 2011.
Cheers!
Hey FC,
My guess would be the smaller junior producers would be taken out first before any of the above. Companies like DEE, BXE or SPE amongst others.
I also have DAY on my watch list, looking to add more units on further market weakness.
Mich:
Great little blogsite you have here.
This is my first day visiting your fine blog.
I’m a small time investor from Las Vegas, Nevada,
looking to buy as many Canadian companies as I can afford.
From the above list I already own 9 of 12 names.
Looking to eventually add BNE, BNP, and NAE.