We use the iShares definition of a Canadian Dividend Aristocrats which is much looser than that of the S&P Dividend Aristocrats. In order to qualify for Dividend Aristocrat status the security must pass the following criteria:
Canadian common stock or income trust listed on the TSX
Cash dividend increases for each of at least the last five years, the dividend in two years may be the same, but must rise in all other years
Float adjusted market cap of at least $300M CAD
Minimum 40 companies
Canadian Dividend Aristocrats Industry Breakdown:
After running these criteria the Canadian universe of stocks is boiled down to the current 76 members of the index. The members of the Canadian Dividend Aristocrats are heavily weighted towards Financials (23%), Energy (23%), and Utilities (12%).
Canadian Dividend Aristocrats Performance:
If you held the Canadian dividend aristocrats since inception you would have seen $10,000 in 2006 become about $18,000 today. While this is decent performance, it is somewhat below the TSX benchmark. One of the main reasons for the under performance is that the criteria are quite broad and include many weaker companies that have cut their dividends after being included in the index, and have seen weak performance as a result.
Using the Canadian Dividend Aristocrats as a Starting Point for building a dividend portfolio:
We recommend using the members of the Canadian Dividend Aristocrats Index as a starting point for further research.
Rather than buying the index as a whole, which has proven itself to under-perform. Smart Dividend Stocks has created a spreadsheet with every member of the Canadian Dividend Aristocrats on it, and many useful dividend metrics to help you analyze which are the best dividend stocks in Canada.
We include basic stock information, specific dividend information including forward yield, payout ratio, interest coverage, and the ex-dividend date. We also include a couple basic valuation metrics to help you quickly shortlist some dividend ideas.