During 2022, I published 24 articles on Substack identifying and analyzing what I considered to be “undervalued” Canadian stocks. The year wound up as a down year for the S&P 500 and most major indices. For me, I enjoyed a gain of approximately ~73%, well above my annual 25% target.
I published articles on pretty well all of my holdings during 2022. In January, I wrote about Peyto Exploration (PEY.TO), Headwater (HWX.TO) and Whitecap (WCP.TO). Peyto ranged $8.75 to over $17.00 and ended the year at ~$12.00 per share with a dividend of $1.32 per share paid monthly (a yield of 11%). Headwater ranged from $4.80 to over $8.00 and ended the year at ~$5.50, with a dividend of $0.40 (a yield of about 7%). Whitecap ranged from $8.00 to $12.00 and ended the year at ~$10.00 with a dividend of $0.44 ( yield of 4.4%). These remain undervalued.
In February I added Birchcliff (BIR.TO), Cardinal Energy (CJ.TO) and Spartan Delta (SDE.TO) to my list of articles. Birchcliff ranged from $5.40 to just over $12.00 per share and stated it will be paying a dividend of $0.80 per share this year, a yeild of about 10% on the current ~$8.00 per share price. Cardinal ranged from $4.40 to $10.00 per share ending the yeat at just over $7.00 with a dividend of $0.72 (a yield of 10%). Spartan Delta ranged from $6.30 to $16.00 per share ending the year over $14.00. $SDE declared a special dividend of $0.50 per share payable this month but has yet to set an ongoing dividend rate.
During the year I also wrote about Tourmaline (TOU.TO), ARC Resources (ARX.TO), Baytex (BTE.TO), Athabasca (ATH.TO), Suncor (SU.TO), MEG Energy (MEG.TO), Surge Energy (SGY.TO) Touchstone Exploration (TXP.TO) and Rubellite Energy (RBY.TO) in the energy space and Western Copper (WRN.TO) in the mining area. All remain undervalued today.
In 2021, my investments returned 188%. In 2022 they returned 73%. What are my expectations for 2023?
I see continued gains in share prices and, more importantly, with debt paid down to immaterial levels, my energy holdings now pay sizeable dividends. Summarizing some of those dividends:
Birchcliff - 122,000 shares and an $0.80 dividend rate yields dividend income of $97,600 in 2023. I opened this position at CAD$0.88 a share.
Spartan Delta - 81,000 and a $0.50 special dividend yields dividend income of $40,500 in 2023. I acquired my Spartan Delta shares for less than CAD$5.00 a share.
Whitecap - 15,000 shares and a dividend rate of $0.44 yields dividend income of $6,600 in 2023. I bought Whitecap at CAD$1.53 a share.
Cardinal - 15,000 shares and a dividend rate of $0.72 yields dividend income of $10,800. I paid CAD$7.00 for my Cardinal shares.
Those four holdings, purchased at a tiny fraction of today’s prices, now return over $155,000 of dividend income for 2023.
You can build your own retirement pension by avoiding trading, confining your investments to dividend paying companies with strong balance sheets, and buying investments when markets are weak. You benefit from lower stock prices, not higher ones. For 2023, at today’s prices, a few names worth considering are CIBC (CM.TO), Manulife (MFC.TO) Birchcliff (BIR.TO) Intel (INTC) Cardinal (CJ.TO) and Amerigo (ARG.TO).
Congrats Michael for the outstanding results in the past 2 years. What your did is impressive. Thank you for generously sharing of your insights. I wish you all the best did 2023.