3 Stocks Going Ex-Dividend Tomorrow: FAF, CNI, BDX

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Tomorrow, Thursday, March 6, 2014, 5:00 AM ET, 46 U.S. common stocks are scheduled to go ex-dividend. The dividend yields on these stocks range from 0.3% to 10.8%. All of these stocks can be found on our stocks going ex-dividend section of our dividend calendar.

Highlighted Stocks Going Ex-Dividend Tomorrow:

First American Financial

Owners of First American Financial (NYSE: FAF) shares as of market close today will be eligible for a dividend of 12 cents per share. At a price of $26.55 as of 9:39 a.m. ET, the dividend yield is 1.8%.

The average volume for First American Financial has been 750,600 shares per day over the past 30 days. First American Financial has a market cap of $2.8 billion and is part of the insurance industry. Shares are down 7.3% year-to-date as of the close of trading on Tuesday.

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First American Financial Corporation, through its subsidiaries, provides financial services. The company operates in two segments, Title Insurance and Services, and Specialty Insurance. The company has a P/E ratio of 15.29.

TheStreet Ratings rates First American Financial as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income. You can view the full First American Financial Ratings Report now.

Canadian National Railway

Owners of Canadian National Railway (NYSE: CNI) shares as of market close today will be eligible for a dividend of 22 cents per share. At a price of $56.27 as of 9:40 a.m. ET, the dividend yield is 1.6%.

The average volume for Canadian National Railway has been 916,000 shares per day over the past 30 days. Canadian National Railway has a market cap of $46.7 billion and is part of the transportation industry. Shares are down 1.3% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Canadian National Railway Company, together with its subsidiaries, engages in rail and related transportation business in North America. The company has a P/E ratio of 19.34.

TheStreet Ratings rates Canadian National Railway as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, good cash flow from operations, increase in stock price during the past year and largely solid financial position with reasonable debt levels by most measures. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook. You can view the full Canadian National Railway Ratings Report now.

Becton Dickinson

Owners of Becton Dickinson (NYSE: BDX) shares as of market close today will be eligible for a dividend of 54 cents per share. At a price of $116.05 as of 9:39 a.m. ET, the dividend yield is 1.9%.

The average volume for Becton Dickinson has been 896,000 shares per day over the past 30 days. Becton Dickinson has a market cap of $22.2 billion and is part of the health services industry. Shares are up 4% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Becton, Dickinson and Company, a medical technology company, develops, manufactures, and sells medical devices, instrument systems, and reagents worldwide. The company's BD Medical segment produces medical devices that are used in various healthcare settings. The company has a P/E ratio of 24.51.

TheStreet Ratings rates Becton Dickinson as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income. You can view the full Becton Dickinson Ratings Report now.

More About Dividends:

One benefit of owning a stock is the potential that you will be paid a dividend. The distribution of dividend payments is another way for a company to share its profit with you. A dividend means that the company pays you a certain amount of money, either as a one-time payment or more commonly on a quarterly basis, for each share of stock you own.

Many times, dividends come at the expense of greater price appreciation, because the company is distributing its profits to shareholders rather than reinvesting the profits back into the growth of the company. However, companies that pay dividends can be very attractive to investors when they offer a steady stream of income. There are some important terms and dates an investor should be familiar with before purchasing any dividend-paying companies. Let's work through an example to help better explain some of these terms:

On March 1, ABC Widget Company has decided that because it holds excess cash and lacks investment opportunities, it would like to reward shareholders with a regular quarterly dividend payment. The date for this particular announcement is known as the declaration date. It is on this date that the company announces the specific dividend payment along with the holder-of-record date (aka record date) and the payment date. The company announces that a dividend payment of 25 cents per share will be payable March 31, 2012 (the payment date) to all shareholders of record at the close of business on March 16, 2012 (holder-of-record date). What does this all mean? Well the short story is that the company looks at its records on March 16 and anyone listed on the books as an owner of ABC Widget company will be eligible for the dividend payment (on March 31).

The one other important term to remember is the ex-dividend date. The ex-dividend date (typically two trading days before the holder-of-record date for U.S. securities) is the day in which a company begins trading without the dividend. In order to have a claim on a dividend, shares must be purchased no later than the last business day before the ex-dividend date. A company trading ex-dividend will have the upcoming dividend subtracted from the share price at the start of the trading day. Many times, the price of a stock will increase in anticipation of the upcoming dividend as the ex-dividend date approaches, yet will fall back by the amount of the dividend on the ex-dividend date.

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