As the month of November begins I look at my portfolio holdings and wonder where I’d like to deploy my cash. This is the first month where I don’t really have a clear conviction of where I’d like to invest as the market has reached an all time high and many stocks have rebounded greatly from our mid October dip. Of course, some energy names still look attractive as oil remains depressed and a few of my holdings are still in the red as I usually prefer to average down a position instead of initiating a new one. That being said, let’s examine some of the names that are on my radar for November.
First off, as no surprise, I am still favorably looking at the large Canadian banks, specifically the ones in my ROTH account. Those names include, The Bank of Nova Scotia (BNS), The Toronto-Dominion Bank (TD) and Royal Bank of Canada (RY). While all slightly in the red, it might be a good month to add to some of those existing positions and bring my cost down a bit more. In general, I like to wait for a price drop of about 5% or more before adding to a position but it’s not a hard rule I follow, rather a guideline. Sticking with the large Canadian banks, I also have been eyeing, but do not yet have a position in Bank of Montreal (BMO) and Canadian Imperial Bank of Commerce (CM).
BMO currently yields a generous 3.80% with a moderate payout ratio of 51.1%. Besides its attractive dividend yield and history, BMO looks attractively valued with a current PE of 12.40 and an even more attractive forward PE of just 10.25.
CM is another top pick of mine in the Canadian banking sector with its large 4.00% yield and moderate payout ratio of 48.7%. These Canadian banks seem to both be offering great relative value as CM’s current PE is 12.74 with an even more enticing forward PE of 9.70 making it one of the cheapest, at least from a strict PE perspective, large Canadian banks.
Moving into the consumer space I am slightly down on another holding of mine in my ROTH account, Unilever plc (UL). As I mentioned earlier, my preference is to average down on any position I currently hold which would put BNS, TD, RY and UL at the forefront of my November stock picks.
As you can see, I am more focused on averaging down on several of my ROTH positions while leaving my taxable account alone for now. Of course, there are other names in my taxable account that also interest me to which I have not added to some of these positions in a while simply because I feel that share price has run way ahead of earnings. I still feel strongly about holding these positions and do not plan to sell anytime soon, I just wish their valuations would come down to Earth a bit before pulling the trigger. Some of those names include, V.F. Corporation (VFC), W.W. Grainger, Inc. (GWW), Bemis Company, Inc. (BMS), CR Bard Inc. (BCR) (I’d like the yield to be a bit higher on that one) and Becton, Dickinson and Company (BDX). I wrote about many of these names a while back in a post titled, “Dividend Aristocrats You Never Heard Of.”
What are some of your stock considerations for November? Are any of the names on my current list on yours as well? Please let me know below.
Disclosure: Long BNS, TD, RY, UL, VFC, GWW, BMS, BDX