A young investor's love of dividends

Keith Lefebvre, 31

Occupation: Product manager

Portfolio: Toronto-Dominion Bank, Inter Pipeline Fund, Husky Energy, Bank of Nova Scotia, Sun Life Financial, IGM Financial, Saputo, Sysco, Procter & Gamble, General Electric, Reitmans, Walgreen, Yellow Pages Income Fund, Canadian Oil Sands Trust, Royal Bank of Canada, Johnson & Johnson, Canadian Pacific Railway, Leon's, Clorox, Telus, Fortis Inc., Diageo, Scotts Miracle-Gro, Manulife Financial, Bank of America.

Why he's focused on dividends

Keith Lefebvre's approach is anchored around dividends. "I'm not as hardcore as some," he notes, as he has a few niche investments that play on demographics and trends, such as Scotts Miracle-Gro, which makes lawn and garden supplies, but most of his holdings are big companies with a history of increasing their dividends. "I just feel a bird in the hand is better than two in the bush," he says, a focus he regularly writes about in his blog at themoneygardener.com.

His buy and sell strategy

"If I make a decision to buy a stock, I'll hold it through good times and bad. I'm absolutely not affected by fluctuations. I buy stocks for the dividend and because of the company's future." He does, however, sell when he feels he's made a mistake, as with Loblaw and Petro-Canada. "My maturity as an investor wasn't there yet." He bought Loblaw about three years back, but sold it eight months later. As for Petro-Canada, he bought it about four years back and sold 12 months later.

How he chooses

"I read and read and read, and I look for companies with a stable history and growing dividends." He likes companies such as Procter & Gamble, and Johnson & Johnson. "They have a long history of growing dividends, and products you cannot see going away any time soon." For example, Mr. Lefebvre would agree with the line from the Monty Python movie, Life of Brian: "Blessed are the cheese makers." A current favourite of his is Quebec-based Saputo Inc., the milk and milk products producer.

Best move

A standout has been Inter Pipeline Fund, which he's owned for three years. "It's a utility, and so it doesn't fluctuate with the price of oil and gas."

Worst move

"Looking at my portfolio right now, GE sticks out like a sore thumb. I wouldn't have expected it to get hit so hard in the [financial] crisis."

Advice

In Mr. Lefebvre's opinion, young people overemphasize riskier investments. "There's something to be said for slow and steady," he says.

Want to share your strategies?

tony.martin@sympatico.ca