Canada Markets closed

2 Dividend Stocks Selling at Their Cheapest in Over 10 Years

Christopher Liew, CFA
Dice engraved with the words buy and sell

I want to focus on two dividend stocks that are selling at their cheapest in 10 years. New investors might not be aware of the standings of the individual stocks back in 2009. Corus Entertainment (TSX:CJR.B) and Husky (TSX:HSE) were once high flyers on the TSX but have fallen like comets from the sky.

Not entertaining anymore

Corus is a $1.1 billion media and content company that has been operating since 1998 from its home base in Toronto. The company operates through two segments: TV and Radio. From the segments alone, you can already tell why the stock is trading at only $5.20 per share today.

Back in 2009, would you believe that the stock price was $16.92? Two years later, Corus climbed to $21.64. People then were great fans of the boob tube and avid radio listeners.

However, video-streaming companies like Netflix and audio-streaming platforms like Spotify have taken over. As a result, TV, and radio seem to be out of place in the modern world.

Corus continues to operate specialty and traditional television networks, and radio stations in Canada and internationally. It has 44 specialty television networks and 15 conventional television stations under its wings. Technology and media services are recent additions.

Conventional TV networks and radio stations are no longer hot items. The stock pays 4.74%, but sustainability is in question since business is not as good as it was 10 years ago.

No energy to grow

Husky is in the same boat as Corus. Ten years ago, the stock was trading at $27.79. As of this writing, it’s down to $9.40, or a steep decline of 66.17%.

The operations of Husky started 81 years ago, and the company is one of the active integrated energy companies in Canada. The company generates revenue from the upstream and downstream segments.

The upstream operations are in Western Canada, offshore East Coast of Canada, and offshore China and Indonesia. Growth could come from China if Husky can add more thermal projects in the future.

Since July, however, production has gone down, which directly impacted cash flow. Husky is not your go-to energy stock, although the 5.43% dividend combined with the low price can whet your investing appetite.

What analysts see so far is the lack of direction. Husky was able to rebound from its massive losses in 2015 and remained in positive territory from 2016 to 2018. Revenue could fall in 2019 with a corresponding decrease in net earnings. Husky is in a bind due to its declining revenue and earnings growth.

Red flags

I am sure bargain hunters are closely monitoring Corus and Husky. But if you’re using your savings to invest in either stock, look at the historical performance and evaluate the growth opportunities of the respective businesses, if there are any.

Otherwise, the business reversals that Corus and Husky went through are red flags. The future is not bright for the two struggling entities.

More reading

Fool contributor Christopher Liew has no position in any of the stocks mentioned. David Gardner owns shares of Netflix. Tom Gardner owns shares of Netflix. The Motley Fool owns shares of and recommends Netflix and Spotify Technology.

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool Canada’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Motley Fool Canada 2019