Dividend Investors: 2 Stocks That Won’t Let You Down

Here’s why Telus Corporation (TSX:T)(NYSE:TU) and Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) should be on your radar.

| More on:

The oil rout has hammered many of Canada’s former dividend darlings, and investors can be forgiven for feeling a bit nervous about buying in the current environment.

Fortunately, there are still names out there with reliable and growing dividends that should be rock solid for decades to come.

Let’s take a look at Telus Corporation (TSX:T)(NYSE:TU) and Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) to see why they look like attractive picks.


Telus has very few serious competitors and operates in a market with high barriers to entry. Consumers might complain about the lack of competition, but shareholders are all smiles.

The company is an attractive pick in the sector because it places a high value on customer service, and the strategy appears to be paying off. Telus regularly posts the lowest mobile churn rate in the industry, and its loyal customers continue to spend more money.

In fact, Telus has racked up 21 consecutive year-over-year quarterly increases in its blended average revenue per user.

Investors have been worried that new pick-and-pay rules for TV subscriptions will have a negative impact on content producers and service providers. Telus doesn’t have a media division, so it isn’t at risk on the content side. As for subscription revenues, I suspect most Canadians will end up paying close to their previous budget.

Telus has an aggressive share-buyback program and raises its dividend every year. The current quarterly distribution of $0.44 per share yields 4.25%.

Bank of Nova Scotia

Investors often pass over Bank of Nova Scotia in favour its two larger peers, but that decision might be a mistake.

The company is Canada’s most international bank with full-service operations in more than 30 countries. Most of the foreign investment has been focused on Latin America, with Mexico, Colombia, Chile, and Peru being the main markets.

You might think this is an odd combination, but the four countries form the core of the Pacific Alliance, a trade bloc set up to provide free movement of capital and goods among the member states. The group has already integrated the four stock markets and more than 90% of tariffs have been eliminated.

Bank of Nova Scotia now has a solid position in each market and is poised to benefit as trade increases. The retail opportunities are also compelling as the growing middle class demands car loans, credit cards, lines of credit, and investment products.

Net income from the international group in fiscal Q1 2016 was $505 million, up 21% compared with the same period last year.

The company just raised its quarterly dividend to $0.72 per share. That’s good for a yield of 4.6%.

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 Andrew Walker has no position in any stocks mentioned.

More on Dividend Stocks

A plant grows from coins.
Dividend Stocks

2 Young TSX Stocks You’ll Be Glad You Bought in 10 Years

Youth means nothing when you plan to hold strong companies long term. These two TSX stocks should therefore be first…

Read more »

Man with no money. Businessman holding empty wallet
Dividend Stocks

Is it a Trap? 3 TSX Stocks With Ultra-High Dividend Yields 

Who doesn’t love dividends? But the high-interest rate environment makes ultra-high dividends unsustainable. Are these stocks a value trap?

Read more »

Value for money
Dividend Stocks

3 Value Stocks for Superior Returns in 2023

Given their solid underlying businesses, stable cash flows, high dividend yields, and attractive valuations, these three undervalued TSX stocks could…

Read more »

Financial technology concept.
Dividend Stocks

2 TSX Value Stocks to Buy for Peace of Mind (and a Crazy-Good Deal)

2 TSX stocks that could outperform in the long term.

Read more »

Dollar symbol and Canadian flag on keyboard
Dividend Stocks

2 of the Best Canadian Dividend Stocks I’d Buy Before March 2023 Ends

Here are two of the best Canadian dividend stocks you can buy on a dip in March 2023 to hold…

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Dividend Stocks

3 Value Stocks That Smart Investors Should Seriously Consider

You get it all with these stable stocks. They may have less growth now, but will have incredibly high growth…

Read more »

Chalk outline of two arrows pointing in opposite directions
Dividend Stocks

2 TSX Stocks I’d Buy Instead of Sitting on Cash

These two TSX stocks are my top choices if you want companies that are going to recover quickly after a…

Read more »

Canadian Dollars
Dividend Stocks

Want $1,000 Per Quarter in Passive Income? 2 TSX Stocks That Do the Job

Are you looking to earn $1,000 in passive income each quarter? These two TSX dividend stocks can help you achieve…

Read more »