Your opinion on ECN Capital Corp

Yeah by that definition, it should not have been included in the Aristocrat list. However it also states:
The security has increased ordinary cash dividends every year for five years, but can maintain the same dividend for a maximum of two consecutive years within that five year period.
This is why it was included. It is the biggest drawback of the methodology and why I prefer the All Star List instead.

Yeah by that definition, it should not have been included in the Aristocrat list. However it also states:
The security has increased ordinary cash dividends every year for five years, but can maintain the same dividend for a maximum of two consecutive years within that five year period.
This is why it was included. It is the biggest drawback of the methodology and why I prefer the All Star List instead.

S&P/TSX Canadian Dividend Aristocrats® measure the performance companies included in the S&P Canada BMI that have followed a policy of consistently increasing dividends every year for at least five years. Index constituents are weighted according to their indicated yield as of the last trading date in November.
From what I read , it’s not even 5 years they have dividends, going from .01 in 2016 to. .025 in 2020.

S&P/TSX Canadian Dividend Aristocrats® measure the performance companies included in the S&P Canada BMI that have followed a policy of consistently increasing dividends every year for at least five years. Index constituents are weighted according to their indicated yield as of the last trading date in November.
From what I read , it’s not even 5 years they have dividends, going from .01 in 2016 to. .025 in 2020.

Just following up on this - ECN doesn't actually have a two year streak - the quarter dividend was not raised in 2020 which is why its 1YR streak and 5YR are 0. It did pay out more $$ in 2020 than in 2019, but that ws just the timing of the dividends. This is why ECN is not on the ALl Star list and why its 1YR rate is 0.

Still don't understand why its on the Aristocrat list - going to have to dig into their listing requirements again, but I was sure they had to have a 5YR streak at which point if they had a grace period of 2YRs without a dividend raise before being booted. Didn't think it applied in the first five years and before inclusion.

Just following up on this - ECN doesn't actually have a two year streak - the quarter dividend was not raised in 2020 which is why its 1YR streak and 5YR are 0. It did pay out more $$ in 2020 than in 2019, but that ws just the timing of the dividends. This is why ECN is not on the ALl Star list and why its 1YR rate is 0.

Still don't understand why its on the Aristocrat list - going to have to dig into their listing requirements again, but I was sure they had to have a 5YR streak at which point if they had a grace period of 2YRs without a dividend raise before being booted. Didn't think it applied in the first five years and before inclusion.

Thanks Mat. If I hear you right, the "cheap" valuation is not so cheap for an asset manager, nor for ECN historically... and it being on the index is not a clear sign of worthiness either. I'll keep it on the B-list then.

Thanks Mat. If I hear you right, the "cheap" valuation is not so cheap for an asset manager, nor for ECN historically... and it being on the index is not a clear sign of worthiness either. I'll keep it on the B-list then.

Hi there,

So had to dig into this one. You are correct that according to the newswire ECN was added to the Canadian Dividend Aristocrat List - why? I actually have no idea.

I double-checked against the All-Star list and it is not listed there as having any type of growth streak. Same thing with our data provide. Then I checked the company's dividend history from the company's actual financials. While it does not have a 5-year dividend growth streak, it does have a 2YR streak.

I'm kind of dumbfounded on this one as depending where you look there is different information. I am going to make some manual changes to our screener based on my findings. I still have no idea why it was added to the Aristocrat list as it does not have a five year streak.

This is a really weird one to be honest. It is likely because it is an asset manager and these companies typically have different interpretations depending of data providers. Not a big fan of these companies because of this reason, they are difficult to value and usually have spotty history of performance.

For its part ECN seems to be a decent company and has shot up in over the past few months. It trading at 11.38 times forward earnings and although that seems cheap, it is above historical averages. These asset management companies usually trade at cheaper valuations. That being said, the expectation is for around 30% revenue growth this year which is quite high for this type of company.

Also worth noting it has received many upgrades as of late, and it has a strong history of meeting or beating estimates (9 of last 12 quarters). So the premium valuation may be warranted.

Mat

Hi there,

So had to dig into this one. You are correct that according to the newswire ECN was added to the Canadian Dividend Aristocrat List - why? I actually have no idea.

I double-checked against the All-Star list and it is not listed there as having any type of growth streak. Same thing with our data provide. Then I checked the company's dividend history from the company's actual financials. While it does not have a 5-year dividend growth streak, it does have a 2YR streak.

I'm kind of dumbfounded on this one as depending where you look there is different information. I am going to make some manual changes to our screener based on my findings. I still have no idea why it was added to the Aristocrat list as it does not have a five year streak.

This is a really weird one to be honest. It is likely because it is an asset manager and these companies typically have different interpretations depending of data providers. Not a big fan of these companies because of this reason, they are difficult to value and usually have spotty history of performance.

For its part ECN seems to be a decent company and has shot up in over the past few months. It trading at 11.38 times forward earnings and although that seems cheap, it is above historical averages. These asset management companies usually trade at cheaper valuations. That being said, the expectation is for around 30% revenue growth this year which is quite high for this type of company.

Also worth noting it has received many upgrades as of late, and it has a strong history of meeting or beating estimates (9 of last 12 quarters). So the premium valuation may be warranted.

Mat