The contribution limit for TFSA (Tax-Free Savings Account) investors has increased to $6,500 in 2023 to keep up with inflation. A popular registered account among Canadians, the TFSA can be used to hold a variety of qualified investments across asset classes such as bonds, shares, and exchange-traded funds.
With the selloff surrounding equity markets having dragged valuations of companies across sectors lower, investors can buy undervalued dividend stocks right now and benefit from outsized gains.
One such TSX stock you can buy in April 2023 is Softchoice (TSX:SFTC). Let’s see why.
Is Softchoice stock a TFSA buy right now?
Softchoice designs, implements, and manages multi-vendor IT environments essential to the operations of its base of enterprise clients. Valued at a market cap of $1 billion, SFTC stock is part of a highly fragmented IT solutions market.
The IT solutions in North America already exceeds $1 trillion and is forecast to grow 7% annually through 2025. Softchoice now expects its total addressable market in 2022 to surpass $300 billion, providing it with enough room to expand its top line, given the company ended 2022 with $1.26 billion in sales.
In the last 12 months, Softchoice reported adjusted EBITDA (earnings before interest, tax, depreciation and amortization) of $82 million, indicating a margin of 6.5%. It reported a net income of $22 million in 2022 compared to a loss of $10 million in 2021. Additionally, free cash flow rose 22% to $72 million, allowing the company to pay shareholders annual dividends of $0.44 per share.
Softchoice offers investors a tasty dividend yield of 2.5%, and these payouts have risen by 57% since December 2021. It has enough room to keep raising dividends, as Softchoice has a payout ratio of less than 30%.
What’s next for SFTC stock and investors?
Softchoice has a diversified base of customers, with the commercial segment accounting for 53% of sales, followed by small and medium businesses at 37% and enterprise at 10%. Softchoice explains commercial clients generate between $2 million and $10 million in annual sales, while enterprise customers generate over $10 million in annual sales. Comparatively, SMBs generate less than $2 million in sales each year.
With more than 4,750 customers, Softchoice believes its go-to-market strategies have driven customer engagement rates higher. Around 59% of its revenue is recurring in nature, while its revenue-retention rate stood at 106%. So, in the last 12 months, existing customers increased spending by 6% on average.
Softchoice is quite optimistic about delivering long-term growth, as it has penetrated less than 5% of its target market. There is also a significant opportunity for the company to gain wallet share from existing customers, as companies continue their digital transformation journeys.
Valued at 0.7 times forward sales and 16 times forward earnings, Softchoice is very cheap. Analysts tracking the TSX tech stock expect its earnings to rise by almost 14% annually in the next five years, which should also support higher dividend payouts. SFTC stock went public in May 2021 and is down 15% since its initial public offer. It’s currently trading at a discount of 10%, given the consensus price target.
TORONTO – Canada’s main stock index was up more than 250 points in late-morning trading, led by strength in the base metal and technology sectors, while U.S. stock markets also charged higher.
The S&P/TSX composite index was up 254.62 points at 23,847.22.
In New York, the Dow Jones industrial average was up 432.77 points at 41,935.87. The S&P 500 index was up 96.38 points at 5,714.64, while the Nasdaq composite was up 486.12 points at 18,059.42.
The Canadian dollar traded for 73.68 cents US compared with 73.58 cents US on Thursday.
The November crude oil contract was up 89 cents at US$70.77 per barrel and the October natural gas contract was down a penny at US2.27 per mmBTU.
The December gold contract was up US$9.40 at US$2,608.00 an ounce and the December copper contract was up four cents at US$4.33 a pound.
This report by The Canadian Press was first published Sept. 19, 2024.
Losing a loved one is never easy, and the legal steps that follow can add even more stress to an already difficult time.
For years, families in Vancouver (and Canada in general) have struggled with a complex probate process—filled with paperwork and legal challenges.
Thankfully, recent changes to Canada’s probate laws aim to make this process simpler and easier to navigate.
Let’s unearth how these updates can simplify the process for you and your family.
What is probate?
Probate might sound complicated, but it’s simply the legal process of settling someone’s estate after death.
Here’s how it works.
Validating the will. The court checks if the will is legal and valid.
Appointing an executor. If named in the will, the executor manages the estate. If not, the court appoints someone.
Settling debts and taxes. The executor (and you) pays debts and taxes before anything can be given.
Distributing the estate. Once everything is settled, the executor distributes the remaining assets according to the will or legal rules.
Probate ensures everything is done by the book, giving you peace of mind during a difficult time.
Recent Changes in Canadian Probate Laws
Several updates to probate law in the country are making the process smoother for you and your family.
Here’s a closer look at the fundamental changes that are making a real difference.
1) Virtual witnessing of wills
Now permanent in many provinces, including British Columbia, wills can be signed and witnessed remotely through video calls.
Such a change makes estate planning more accessible, especially for those in remote areas or with limited mobility.
2) Simplified process for small estates
Smaller estates, like those under 25,000 CAD in BC, now have a faster, simplified probate process.
Fewer forms and legal steps mean less hassle for families handling modest estates.
3) Substantial compliance for wills
Courts can now approve wills with minor errors if they reflect the person’s true intentions.
This update prevents unnecessary legal challenges and ensures the deceased’s wishes are respected.
These changes help make probate less stressful and more efficient for you and other families across Canada.
The Probate Process and You: The Role of a Probate Lawyer
(Image: Freepik.com)
Working with a probate lawyer in Vancouver can significantly simplify the probate process, especially given the city’s complex legal landscape.
Here’s how they can help.
Navigating the legal process
Probate lawyers ensure all legal steps are followed, preventing costly mistakes and ensuring the estate is managed properly.
Handling paperwork and deadlines
They manage all the paperwork and court deadlines, taking the burden off of you during this difficult time.
Resolving disputes
If conflicts arise, probate lawyers resolve them, avoiding legal battles.
Providing you peace of mind
With a probate lawyer’s expertise, you can trust that the estate is being handled efficiently and according to the law.
With a skilled probate lawyer, you can ensure the entire process is smooth and stress-free.
Why These Changes Matter
The updates to probate law make a big difference for Canadian families. Here’s why.
Less stress for you. Simplified processes mean you can focus on grieving, not paperwork.
Faster estate settlements. Estates are settled more quickly, so beneficiaries don’t face long delays.
Fewer disputes. Courts can now honor will with minor errors, reducing family conflicts.
Accessible for everyone. Virtual witnessing and easier rules for small estates make probate more accessible for everyone, no matter where you live.
With these changes, probate becomes smoother and more manageable for you and your family.
How to Prepare for the Probate Process
Even with the recent changes, being prepared makes probate smoother. Here are a few steps to help you prepare.
Create a will. Ensure a valid will is in place to avoid complications.
Choose an executor. Pick someone responsible for managing the estate and discuss their role with them.
Organize documents. Keep key financial and legal documents in one place for easy access.
Talk to your family. Have open conversations with your family to prevent future misunderstandings.
Get legal advice. Consult with a probate lawyer to ensure everything is legally sound and up-to-date.
These simple steps make the probate process easier for everyone involved.
Wrapping Up: Making Probate Easier in Vancouver
Recent updates in probate law are simplifying the process for families, from virtual witnessing to easier estate rules. These reforms are designed to ease the burden, helping you focus on what matters—grieving and respecting your dead loved ones’ final wishes.
Despite these changes, it’s best to consult a probate lawyer to ensure you can manage everything properly. Remember, they’re here to help you during this difficult time.
TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.
The S&P/TSX composite index was up 34.91 points at 23,736.98.
In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.
The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.
The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.
The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.
This report by The Canadian Press was first published Sept. 17, 2024.
