Five Dividend Stocks With Room To Grow

Investing in dividend stocks is simple. Just pick the stock with the highest yield, right? Wrong. There’s more to it than that. For Greg Newman, associate portfolio manager and senior wealth adviser with the Newman Group at ScotiaMcLeod, a solid dividend is just the starting point. When choosing stocks, he also evaluates the company’s anticipated dividend growth rate, prospects for capital appreciation and the stock’s risk level. Valuation – whether the stock is cheap or expensive based on various measures – also factors into the equation.

Here are five dividend stocks that pass his tests. Remember to do your own due diligence before purchasing any security: Royal Bank of Canada Yield: 4 per cent, Agrium Yield: 3.2 per cent, TransCanada Yield: 3.8 per cent, Intact Financial Yield: 2.9 per cent and Algonquin Power & Utilities Yield: 4.4 per cent.

Source: Globe and Mail

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