June 4th TFSA Purchases

Telus

 

Hi everyone, I hope all of you are doing well. June has been a busy month for me in terms of buying stocks. In fact I have spent all of my money in my TFSA account. This post will be the first of five where I share with you what I purchased. Some may wonder I chose to spend all of my money now, when possibly the stock market may crash again (DOW futures down 600+ points at the time of writing) or a second wave of COVID-19 will hit in the fall. I respond by saying we can’t time the market if we could we would all be millionaires. I am comfortable at the prices I bought at and will use the dividends I receive from the stocks to buy more shares of what I hold.

Buy #1 – Telus

My first purchase was Telus (ticker T.TO), I made a couple of purchases of Telus in May so I don’t really need to go into great detail my I bought the stock. Since my last purchase and this one there was a big announcement by Telus in regards to who their 5G supplier would be. On June 2nd the company announced that they decided to go with two European suppliers for their 5G network Ericsson and Nokia. I am really happy the company made this decision as I didn’t want Hauwei get the contract as they in my opinion should be banned from Canada’s 5G network. Investors reacted favorably on this news by going by driving the stock up 4%.

Upon hearing this news I decided to add to my position. I purchased 20 new shares at a price of $24.57. The time I bought the stock the shares were priced at $22.41 so a significant rise on the news of the 5G suppliers.

Telus pays a quarterly dividend of $0.29125. With this purchase my income will increase by $5.82 per quarter and $23.28 annually.  Over the last several years Telus has raised their dividend in May as part of their semi-annual raise plan, this time they decided to leave the dividend as is and will wait and see how the rest of the year plays out.

 

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Buy #2 – Alimentation Couche-Tard

 

My second purchase was Alimentation Couche-Tard (Ticker: ATD.B) and this is a new stock for my TFSA account, however it is not a new one for my portfolio. Up until last year I held this stock in my RRSP account for a couple of years, last summer I decided to sell it and take a big profit and invest the proceeds in US stocks. With the money I purchased shares of Walgreen’s Boots Alliance, 3M, Texas Instruments and Microsoft.

If you live in Canada or the United States you probably have visited a store owned by the company. They are the leader in the convenience store industry in Canada , in the United States they are the largest independent convenience store operator. According to their third quarter report as of February 2nd in North America the company had 9,799 stores, with 8,594 selling fuel. They have a pretty sizable store count in Europe mostly in Scandinavia with 2,697. They also have licensing deals around the rest of the world and this accounts for another 2,380 stores.

The company pays a dividend with a yield of 0.67% I know very tiny right! However don’t let that fool you, the company has been increasing it’s dividend over the last few years, I must admit I don’t have the correct number I think it’s 10 straight years. In fact this passed March they raised it 12% and it now sits at $0.07 per share.

The company is growth focused, they continue to look for deals around the world. Just recently they decided to stop trying to buy Caltex Australia due to uncertainty surrounding COVID-19. That deal if it would have gone through was going to cost around $5.6 billion.

The Deal

I purchased 12 shares of the stock at a price of $42.71 per share. This is a small starter position. Over time I plan on buying more. This purchase will add $0.84 in quarterly income and $3.36 in annual income.

I believe both of these stocks are well positioned in today’s new world, both have liquidity to whether the storm. In fact I am a customer of both with Telus I am with their discount brand Koodo for my cellphone and with Couche-Tard my family has been buying our milk there for years.

Thanks for reading

Matthew

13 thoughts on “June 4th TFSA Purchases

  1. Hey Matthew,

    Those are great buys. You shouldn’t worry about buying and the market crashing since that’s out of your control on what the market does. It’s better to spend time in the market than try to time the market!

    DG Capital

    Liked by 1 person

  2. Great buys, Matt. I think Couche-Tard will eventually raise the dividend to 1.5 – 2% annually because of the growth plan till 2022. Once the growth plan is executed, they could pay more money to shareholders. I think ATD is also testing out electric car charging station in Europe and once they bring that into North America, that will be a huge for margins and convenience store sales. In the past few decades, the convenience store sales are down because most people use credit cards at the pump, thus the foot traffic at the store is reduced. But, with electric cars which will take 15-20 minutes to fast charge, people will want to snack on on something, potentially increasing the foot traffic and higher sales. It’s certainly a long-term hold!

    Liked by 1 person

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