Hello everyone I hope you are all doing well. Today I wanted to share with you a recent purchase I made. On November 15th I bought some shares of Diversified Royalty Corp, the purchase was made in my Locked In Retirement Account (LIRA). I now hold two stocks in the account. What is Diversified Royalty Corp?
Diversified Royalty Corp. (“DIV”) is a multi-royalty corporation, engaged in the business of acquiring top-line royalties from well-managed multi-location businesses and franchisors in North America. DIV’s objective is to acquire predictable, growing royalty streams from a diverse group of multi-location businesses and franchisors.
(Source: Company Website)
The company currently has three royalty partners Mr. Lube, Sutton, and Air Miles.
- Mr. Lube – Is in the quick oil change industry and has 170 locations (growing) across Canada. They are the market leader.
- Sutton – Founded in 1983 by the opening of Sutton West Coast Realty in North Vancouver. Sutton West Coast Realty is the largest residential brokerage operation in the country today. They have 200 offices across Canada.
- Air Miles – Launched in Canada in 1992, AIR MILES® is Canada’s largest coalition loyalty program with over 170 brand name sponsors including Bank of Montreal, Sobey’s, Shell Canada, Safeway, Metro and online partners such as Amazon.ca and eBay. Consumers collect AIR MILES® reward miles from sponsors, which can be redeemed for a multitude of reward choices, such as travel, entertainment, home electronics and gift cards. There are currently more than 11 million active AIR MILES® collector accounts across Canada and approximately two-thirds of Canadian households participate in the AIR MILES® Reward Program.
Dividend
The company currently pays a monthly dividend of $0.01854. The dividend has not increased since October 2015.
Purchase & Income
On November 15th I purchased 120 shares @$2.60 per share. I had $320 bucks sitting in my account and wanted to put it to work. With the 120 shares I should receive $2.22 per month in dividend income or $26.64 annually.
So what do you think of my purchase? Do you own the stock? Feel free to let me know in the comments below.
Thanks for reading
Matthew
All About The Dividends 
Hmm. DIV seems to own the Air Miles trademarks, but the actual Air Miles program is owned by an American company called ADS. Not sure how that relationship works.
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Hey Marc I have to dig a little deeper on the Air Miles relationship myself to completely understand it.
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I’ve owned Div for a while now(not a huge amount). Currently Dripping I think about 5 shares a month.
It’s definitely come down a bit, and could be a good time to start a position.
The only concern right now, is that the payout ratio is over 100%,and until they get a new royalty deal in place, it will remain above 100%. Obviously, the hope, (and their plan) is to get a deal in place before the cash runs out. If they do – everything should be fine -but if they aren’t able to find a deal in time, they may have to cut the dividend.
They still have quite a bit of cash from their last sale, so hopefully they can ink a new deal soon.
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It’s a nice buy at this level! I own quite a bit myself. Like Jordan said, they need to score one more royalty deal to secure the dividend. Right now they cover the shortfall from their reserve. But you pick it up at the great price here!
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Thanks I thought the price was at a good entry point.
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interesting buy.
Dunno much about them but i collect air miles!
keep stacking them dividends.
cheers
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