This strategy targets companies with a dividend yield that exceeds the national benchmark, ensures no dividend cuts in the past decade (with certain leniency in Canada if other criteria are met), maintains a free cash flow yield above the dividend yield, and achieves positive dividend growth in the past year.

2. Dividend Yield Universe (0-40%)

This segment focuses on companies paying a dividend yield greater than 3.5% without any cuts in the last five years, ensuring a stable and attractive return for income-focused investors.

3. Dividend Growth Universe (0-40%)

This category features firms with a dividend yield above 1%, no cuts in the last five years, free cash flow yields surpassing the dividend yield, and a dividend payout ratio below the country benchmark – showcasing companies poised for future growth.

The current lineup features a robust mix of companies including industry giants such as Telus Corp., Verizon Communications Inc., Canadian Tire Corporation, and Apple Inc., among others. This diversified portfolio aims to provide both steady income and potential for growth, making it suitable for risk-averse investors.

Related News

In related news, BofA Securities strategist Anthony Cassamassino has updated his recommendations for the first quarter of 2025. The new list includes ten US stocks anticipated to experience significant business and market catalysts. Among these stocks are notable buys like AMETEK, Chevron, Chewy, and Wells Fargo, while Illumina is projected to underperform.

Concerns in the Canadian Manufacturing Sector

Shifting the focus to the Canadian economic landscape, National Bank economists Stefane Marion and Ethan Currie recently highlighted concerns regarding the shrinking Canadian manufacturing sector. Their report underscores the critical need for Canada to maintain a robust manufacturing base to ensure long-term resilience and attract investment. Despite a 9% share of manufacturing in GDP, Canada is set to have the smallest manufacturing sector among G7 nations when leaders convene for the G7 Summit in June 2025, a worrisome fact that underscores the urgency for policy adjustments.

Conclusion

These developments in investment strategies and economic analysis signal pivotal shifts in how investors and policymakers may navigate the complexities of the current market landscape. With BMO's portfolio and the insights from BofA and National Bank, both investors and manufacturers are set to reconsider their strategies for the challenges ahead.