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Tuesday Ticker: June 24, 2025

C Rm Ticker

Toronto, Ontario -- Companies usually offer dividends for one of three reasons -- to share profits with shareholders, reward investment during steady periods or to attract or retain investors seeking regular incomes. This week's Tuesday Ticker takes a closer look at two Canadian automotive aftermarket organizations using dividends to attract investors' attention.

Boyd's steady strategy

The Boyd Group Services Inc. is offering its shareholders $0.153 per-share as a cash dividend during second quarter of 2025. The decision, announced in a June 17 press release,  means shareholder payouts have remained unchanged since Q4 of 2024.

While the press release made no mention of earnings or specific financial performance, investors took the announcement as a signal the company is continuing to be a steady performer. Following the announcement, the stock rose by a little more than three percent, from $204.76 to about $211.85 on June 23.

Returning about 0.29 percent of the stock's value to owners each year, the dividend itself is unlikely to have turned many investor's heads. While many publicly traded Canadian companies do not provide dividends, those that do tend to return between two and four percent of a share's value over the course of a year.

Automotive Properties' sky-high dividends

Canada's highest automotive aftermarket dividend is offered by the Automotive Properties, a real estate investment trust. 

The Automotive Properties REIT owns 79 dealership properties in Canada and the United States. Last week, it announced it is raising its keeping its dividend at $0.804 per unit on an annualized basis. With each unit trading for about $11.35, the dividend returns more than seven percent of a unit's value to the holder each year. The dividend offered by the REIT has remained unchanged since December 2024.

The REIT offers higher-than-normal interest rates due to its business model. It has many long-term rental agreements with car dealerships that promise steady rent payments. While this reliance on steady rent provides steady returns, it also makes the REIT particularly sensitive during high interest regimes. By paying a higher dividend, the REIT helps offset the risk of rate hikes and make its units more enticing to investors.

 

 

 

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