1 Dividend Stocks to Own as Canadian Consumer Debt Soars

An Ipsos poll conducted in mid-December revealed that the average Canadian owes more than $8,500 in consumer debt. In the poll, 12% of Canadians reported consumer non-mortgage debt of over $25,000, and 14% have debts between $10,000 and $24,999. The average came in over $15,000 for all Canadians who held debt, as 46% reported no debt at all.

Data released by Statistics Canada on December 14 painted a similar picture regarding household debt. Household credit market debt as a proportion of household disposable income rose to 171.1% from 170.1% in the second quarter of 2017. The new OSFI mortgage rules that triggered in January, which includes a stress test on uninsured borrowers, are expected to flatten this ratio over the coming months.

Goeasy Ltd. (TSX:GSY) is a Mississauga-based provider of goods and financial services to consumers. The company offers unsecured installment loans. Goeasy stock was up 2.66% at the top of the noon hour on January 9. Shares have climbed 58% year over year.

The company released its third quarter results on November 1. Revenue jumped 18.1% to $103.7 million and it posted same store sales growth of 21.3%. Its consumer loans receivable portfolio reached $473.1 million by the end of the third quarter.

All six commercial banks in Canada expect the Bank of Canada to raise interest rates on January 17. This tightening environment will make it even more difficult for overleveraged borrowers, which could drive business to companies like Goeasy. The stock also offers a dividend of $0.18 per share representing a 1.8% dividend yield.