The top Canadian dividend stocks are reliable investments that can help build passive income while keeping your portfolio resilient through market fluctuations. Many leading companies distribute dividends and have the financial strength to increase their payouts over time. This combination makes them appealing choices for investors who want both income and long-term wealth creation.
The key is to focus on fundamentally strong companies that have a proven history of paying dividends, generate healthy earnings, and have sustainable payouts. TSX stocks with these attributes are likely to reward shareholders by paying and growing their dividends over time. Thus, these stocks provide steady income that can either be reinvested for compounded returns or used to meet everyday expenses.
With this backdrop, here are the top four Canadian dividend stocks I think everyone should own.
Fortis stock
Fortis (TSX:FTS) is a reliable dividend stock for income-focused Canadian investors. This leading North American utility company runs a regulated business that consistently generates predictable and growing cash flow. Its defensive business model and steadily increasing cash flow have allowed Fortis to raise its dividend for 51 straight years. It currently pays $0.615 per share quarterly, yielding about 3.6%.
Looking ahead, Fortisâs management aims to grow dividends by 4-6% annually through 2029, backed by a $26 billion capital plan that is expected to expand its rate base to $53 billion. Its focus on modernizing infrastructure, energy transition opportunities, and growing electricity demand led by data centres is likely to drive Fortisâs financials, supporting higher dividend payments.
Bank of Montreal stock
Top Canadian banks are known for rewarding investors with steady dividends, and Bank of Montreal (TSX:BMO) stands out for its longest streak of dividend payments. The financial services giant has paid dividends for an unmatched 196 consecutive years. Further, its dividend has grown at a compound annual growth rate (CAGR) of over 5% in the last 15 years.
BMO continues to expand its loan and deposit base, which will support its future earnings and dividend payments. Moreover, its diverse revenue streams, strong credit performance, and improving efficiency augur well for growth. It currently offers a yield of 3.7% and maintains a low payout ratio, which is sustainable in the long term. In short, its solid dividend payment history, sustainable payouts, and consistent earnings growth make it a compelling income stock.
TC Energy stock
TC Energy (TSX:TRP) is a dependable dividend stock everyone should own. With a 25-year track record of annual dividend growth, the company continues to reward shareholders with reliable income. Its business model is anchored by regulated and long-term, take-or-pay contracts, which account for roughly 97% of earnings. This structure shields the company from commodity price and volume volatility, ensuring stable cash flows to support its dividend.
Looking ahead, TC Energy is well-positioned to benefit from rising demand for natural gas and power across North America. TC Energy plans to invest $6 to $7 billion annually in 2025 and 2026 on projects backed by long-term contracts. These investments are expected to drive sustainable earnings growth, strengthen the balance sheet, and support targeted dividend increases of 3-5% per year. Currently, TRP stock offers a yield of over 4.7%.
Enbridge stock
Enbridge (TSX:ENB) is one of the most reliable dividend stocks to buy and hold, thanks to its solid dividend payments and growth history. It has been paying dividends for over seven decades. Moreover, since 1995, this energy infrastructure leader has raised its distribution every year.
Approximately 98% of Enbridge’s earnings come from regulated returns or long-term contracts, which shield it from fluctuations in oil and gas prices. Its vast North American pipeline and utility network generate steady cash flow, while recent acquisitions of three major U.S. natural gas utilities have further strengthened its earnings base.
Today, Enbridge offers a quarterly dividend of $0.943 per share, yielding 5.7%. With diversified operations, strong earnings and distributable cash flows, and a commitment to steady dividend growth, Enbridge will continue to reward investors.
The post 4 Canadian Dividend Stocks I Think Everyone Should Own appeared first on The Motley Fool Canada.
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Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge and Fortis. The Motley Fool has a disclosure policy.
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