Keep These Stable Dividends for Life

Get decades of dividends from stable companies like Great-West Lifeco Inc. (TSX:GWO), Telus Corporation (TSX:T)(NYSE:TU), and Power Corporation of Canada (TSX:POW).

| More on:

It is always incredibly difficult to predict the next market collapse. From a birds-eye view, there are some areas of concern for the Canadian stock market. Canadian household debt as a percent of household income is higher than ever, the mortgage credit market has been slowing down (a bad sign for the housing market), and Deutsche Bank recently released a report saying that the housing market is over 60% overvalued.

Even through tough times, however, there are still companies out there that have a proven history of providing stable and reliable income streams to investors. Here are three of the best:

Great-West Lifeco Inc.

With a 20+ year dividend history, Great-West Lifeco Inc. (TSX:GWO) is a classic example of an under-appreciated dividend payer. The company has various insurance and asset-management companies in Canada, the United States, Europe, and Asia. The majority of its profits stem from life insurance, health insurance, retirement savings, investment management, and reinsurance.

Even during the entire financial crisis, Great-West never cut its dividend. Just this year the company boosted the per-share payout from $1.23 a year to $1.32, resulting in a 3.54% yield. With record profits and a proven ability to support the dividend during economic turmoil, Great-West deserves more attention from income seekers.

Telus Corporation

With a dividend-payment history also stretching back to the previous century, Telus Corporation (TSX:T)(NYSE:TU) has shown a recent ability to grow its dividends at an impressive rate. The company has been providing communication services for over 100 years, although its wireless segment is now its bread and butter.

In its wireless segment, Telus has a reputation for high customer retention and shows a high profit margin per customer with a growing client base (up 3.8% to 8.1 million). All of this has resulted in one of the strongest dividend-growth performances over the past 10 years, with a current yield over 4%. Even after growing the dividend every year in the past decade, the stability of the Canadian market combined with Telus’s superior capital management should allow for further increases.

Power Corporation of Canada

As a conglomerate, the Power Corporation of Canada (TSX:POW) is often overlooked given its disparate businesses. It holds numerous investment stakes in a variety of Canadian businesses, including Great-West. Its industries of interest span cement, oil and gas, electricity, environmental services, water and waste management services, as well as wines and spirits. The company is run by Paul Desmarais, who some have dubbed the Warren Buffett of Canada.

As with the previous companies listed in this article, Power Corporation has an incredibly long dividend history. Since 1999, the company has never been forced to lower its payment, and recently raised it by over 7%, resulting in a 3.83% yield.

To support the dividend, EPS has grown by nearly 50% in the past five years. With a well-respected, long-term investor at the helm, expect Power Corporation to grow the dividend and continue to compound investor capital.

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 Ryan Vanzo has no position in any stocks mentioned.

More on Dividend Stocks

Businessman holding tablet and showing a growing virtual hologram of statistics, graph and chart with arrow up on dark background. Stock market. Business growth, planning and strategy concept
Dividend Stocks

TFSA Magic: Earn Enormous Passive Income That the CRA Can’t Touch

If you're seeking out passive income, with zero taxes involved, then get on board with a TFSA and this portfolio…

Read more »

Man with no money. Businessman holding empty wallet
Dividend Stocks

2 Stocks Under $50 New Investors Can Confidently Buy

There are some great stocks under $50 that every investor needs to know about. Here’s a look at two great…

Read more »

think thought consider
Dividend Stocks

Down 10.88%: Is ATD Stock a Good Buy After Earnings?

Alimentation Couche-Tard (TSX:ATD) stock might not be the easy buy-case it once was. Here’s a look at what happened.

Read more »

money cash dividends
Dividend Stocks

TFSA Dividend Stocks: Earn $1,200/Year Tax-Free

Canadian stocks like Fortis are a must-have in your portfolio to earn tax-free yields for decades.

Read more »

sale discount best price
Dividend Stocks

1 Dividend Stock Down 11 Percent to Buy Right Now

Do you want a great dividend stock down 11% that can provide years of growth potential? Here's one heavily discounted…

Read more »

Growth from coins
Dividend Stocks

1 Grade A Dividend Stock Down 11% to Buy and Hold Forever 

If you're looking for the right dividend stock at the right price, you're going to want to consider this insurance…

Read more »

Target. Stand out from the crowd
Dividend Stocks

2 Dividend Stocks to Double Up on Right Now

Are you looking for dividend stocks to buy right now? Here are two top picks!

Read more »

edit Taxes CRA
Dividend Stocks

Tax Time: How to Keep More of Your Money

Nearly everyone hates paying taxes, although Canadians can lessen the financial pain with the right tax strategies.

Read more »