New Investors: Dividend Stocks for High Income | The Motley Fool Canada

New Investors: Dividend Stocks for High Income | The Motley Fool Canada: "Solid Canadian bank

Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) pays out the highest yield of the Big Five banks in Canada due to its price retreat. The share price fell from a 52-week high of $71 to $60 for a 15.5% dip.

Thanks to the dip, it now yields almost 4.7%. You can count on the quality bank’s dividends because this year is the 183rd year that it has paid dividends. It certainly doesn’t want to break that kind of record.

The safety of the dividend is supported by a payout ratio of 50%, which is in line with the other big banks. Further, the bank has been awarded an A+ S&P credit rating, which implies that it is financially solid.

Valuation wise, Bank of Nova Scotia has traded at a normal multiple of 12.4 in the past decade, while it’s currently trading at a multiple of 10.6. So, the bank is moderately undervalued with a discount of about 15%."



'via Blog this'