Skip to main content

The Globe and Mail

Low-volatility dividend stocks for stormy times

Pedestrian in the rain and winds in downtown Toronto on June 1, 2012.

Deborah Baic

What are we looking for?

Stocks that will pay you to hold on during these volatile times. The goal of today's screen is to highlight equities that are steadier than the general market and that also pay dividends, with growing cash flow to support those distributions. Stocks like these are not too exciting, but they can be ideal for investors nervous about the economic outlook.

More about today's screen

Story continues below advertisement

Craig McGee, senior consultant at CPMS Morningstar Canada, created today's offering. He filtered the CPMS database of Canadian companies to select stocks that:

  • were in the lowest quartile of the TSX composite based on price volatility (defined as the standard deviation of daily returns over the past year);
  • had an expected payout ratio (dividends over the past four quarters divided by expected cash flow) of less than 100 per cent;
  • had a positive change over the past 90 days in analysts’ median cash flow estimate.

Mr. McGee restricted any one sector to no more than five stocks.

More about CPMS

CPMS, a division of Morningstar Canada, provides quantitative North American equity research and portfolio analysis to institutional clients and financial advisers through software and Web-based tools. It covers more than 700 Canadian and 2,200 U.S. stocks, and adjusts for unusual accounting items in each company's quarterly results to make sure screens can perform correctly.

What did we find?

A list heavy with real estate investment trusts, utilities, grocers and retailers of affordable necessities. While there are no guarantees, each of these firms seems decently positioned to weather whatever the economy can throw at it.

Note, however, that many have already seen their share prices rise as investor pursue havens. If you're looking to make big gains on rising share prices, they're probably not for you. On the other hand, if you're hunting for stability and a bit of income, they may be ideal. "With the fog of market uncertainty growing, these stocks may be reasonable choices for investors looking to get paid to wait out the turbulence," Mr. McGee says.

Story continues below advertisement

Report an error Licensing Options
About the Author

Ian McGugan is a reporter with The Globe and Mail's Report on Business and has been writing about investing, economics and business for more than 20 years. He joined the Globe and Mail in 2010. He has been executive editor of Canadian Business magazine and founding editor of MoneySense magazine. More


The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨

Combined Shape Created with Sketch.

Globe Newsletters

Get a summary of news of the day

Combined Shape Created with Sketch.

Thank you!

You are now subscribed to the newsletter at

You can unsubscribe from this newsletter or Globe promotions at any time by clicking the link at the bottom of the newsletter, or by emailing us at