A Yield to Caution: Rogers Sugar

Article Excerpt

In this, your latest issue of Dividend Advisor, you’ll find several high-yield stocks we recommend for new buying. Among them are high-quality utilities Enbridge and Fortis , top REITs RioCan and Allied Properties, and U.S. dividend payers Archer Daniels Midland and Ford. While those picks should continue to pay off for our subscribers, today’s low interest rates lead some investors to indiscriminately reach for high yields to make up for meagre fixed-income returns. But in focusing on yield, those investors may be taking on more risk than they should. As 100% owner of Lantic sugar, ROGERS SUGAR, $5.11, offers investors a high 7.1% yield. The company (Toronto symbol RSI; Shares o/s: 104.0 million; Market cap: $531.4 million; Divd. yield: 7.1%; www.lanticrogers.com) is, in fact, the leading supplier of refined sugar in Canada. However, it faces sluggish domestic demand and growing competition in its markets. And with health trends moving away from refined sugar, it could be hit with falling demand and profits. As well, Rogers’s 2017 purchase of maple syrup company L.B. Maple Treat Corp. has not gone…