Banking is what makes the business world go ‘round. And American investors often forget that there is a whole ecosystem of financial institutions overseas that drive commerce, engage in lending activity, and perform consumer banking needs. These firms can often provide just as much in the way of dividend prowess as many U.S.-based bank stocks. Case in point, our latest Best Dividend Capture Pick has been rewarding shareholders with rising dividends for the last 15 years straight!
You can check out the Best Dividend Capture Stocks List to explore all the stocks.
The reason for our pick’s long history happens to be its operating country and its status. Our pick is one of the largest financial institutions in Canada. Offering everything from commercial and consumer banking to wealth management and capital markets access, our pick has quickly evolved into a top-notch financial institution with nearly $2 trillion in assets under management. Moreover, Canada’s banking system remains one of the soundest in the world. Regulations have long prevented Canada’s banks from taking on too much risk. As a result, our pick remains a conservative choice with very high Tier 1 capital ratios and reserves. This has allowed our pick to thrive during periods of strife.
But conservative doesn’t mean low or no growth.
It has been just the opposite. Our pick has continued to find ways to grow, both organically and through acquisition. This has included adding a hefty dose of technology to improve the underwriting of loans and consumer experience as well as smart buyouts. This has included a recent purchase of a struggling rival who was looking to exit the Canadian market. Our pick’s fiscal conservatism gave it the firepower to make the buyout happen.
That fiscal conservatism and smart growth mandates have also allowed it to reward its shareholders for decades.
With its strong growth, importance in the global banking system, and conservative management, our pick has continued to find investors’ support. As such, it has become a wonderful dividend capture play. A dividend capture strategy involves buying a stock before its ex-dividend date and then selling it after it has recovered the payout. With an ex-dividend date of Monday, January 27, our pick is primed for the strategy, as is evident from its historical track record of a recovery period within an average of 11.2 days after going ex-dividend.
For investors looking for a quick total return of income and capital appreciation, our latest banking play could be a lucrative option.
