One of the most well-known facts about investing is that dividend-paying stocks far outperform their non-dividend-paying counterparts over extended periods of time. This means that every long-term investor should own at least one dividend-paying stock, and depending on your age and investment goals, maybe a diversified portfolio full of them. With this in mind, let’s take a look at three of the top dividend stocks yielding over 3.5% that you should consider buying today.
1. Royal Bank of Canada: 3.8% yield
Royal Bank of Canada (TSX:RY)(NYSE:RY) is the largest bank in Canada in terms of total assets and pays a quarterly dividend of $0.77 per share, or $3.08 per share annually, giving its stock a 3.8% yield at current levels. In addition, the company has raised its dividend eight times in the last four years, showing that it is fully dedicated to maximizing shareholder returns, and its financial stability could allow for another increase in the very near future.
2. Potash Corp./Saskatchewan: 3.8% yield
Potash Corp./Saskatchewan (TSX:POT)(NYSE:POT) is the world’s largest manufacturer of fertilizer and pays a quarterly dividend of $0.38 per share, or $1.52 per share annually, which gives its stock a 3.8% yield at today’s levels. Like Royal Bank of Canada, Potash has steadily raised its dividend, including six increases in the last four years, and its increased free cash flow could enable another increase in fiscal 2015.
3. Husky Energy Inc.: 4.4% yield
Husky Energy Inc. (TSX:HSE) is one of the largest integrated energy companies in Canada, and it pays a quarterly dividend of $0.30 per share, or $1.20 per share annually, giving its stock a 4.4% yield at current levels. The company has been negatively impacted by the ongoing weakness in commodity prices, which has caused some investors to worry about the possibility of a reduction in its dividend, but its operating cash flow has remained strong, so I think it is safe for the time being.
Which of these top dividend stocks belong in your portfolio?
Royal Bank of Canada, Potash Corp./Saskatchewan, and Husky Energy represent three of the top dividend investment opportunities in the market today. All long-term investors should take a closer look and strongly consider buying one or more of these stocks.
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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Joseph Solitro has no position in any stocks mentioned.