2 Top Dividend Stocks Yielding Over 4.5% I’d Buy Today

Searching for high-quality high yielders? If so, CT Real Estate Investment Trust (TSX:CRT.UN) and Enbridge Inc. (TSX:ENB)(NYSE:ENB) should be on your radar.

| More on:

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

One of the most well-known facts about investing is that dividend-paying stocks far outperform their non-dividend-paying counterparts over the long term. It’s for this reason that all long-term investors should own at least one dividend-paying stock and, depending on your age, investment goals, and risk tolerance, maybe even a diversified portfolio full of them.

With this in mind, let’s take a closer look at two high-quality stocks with yields over 4.5% that you could buy right now.

CT Real Estate Investment Trust

CT Real Estate Investment Trust (TSX:CRT.UN) is one of Canada’s largest commercial REITs. As of March 31, its portfolio consisted of 299 retail properties, four distribution centres, one mixed-use commercial property, and three properties under development that are located across every province and two territories and total approximately 24.95 million square feet of gross leasable area.

CT currently pays a monthly distribution of $0.05833 per unit, representing $0.70 per unit on an annualized basis, which gives its stock a yield of approximately 4.7% at today’s levels.

It’s very important to always confirm the safety of a stock’s distribution before investing, and you can do this with CT by checking its distributions as a percentage of its adjusted funds from operations (AFFO). In its three-month period ended on March 31, its AFFO totaled $0.227 per unit, and its distributions totaled just $0.175 per unit, resulting in a sound 77.1% payout ratio.

If a high and safe 4.7% yield were not enough to have you salivating over CT, then the fact that it’s also one of the industry’s best distribution-growth plays surely will. It has raised its annual distribution every year since its initial public offering in 2013, resulting in three consecutive years of increases, and its 2.9% hike which took effect in January has it positioned for 2017 to mark the fourth consecutive year with an increase.

I think CT is a top pick for yield and distribution growth going forward as well. I think its strong financial performance, including its 10.2% year-over-year increase in AFFO to $0.227 per unit in the first quarter of 2017, and its vastly improved AFFO payout ratio, including 77.1% in the first quarter of 2017 compared with 82.5% in the year-ago period, will allow its streak of annual distribution increases to continue for another four years at least.

Enbridge Inc.

Enbridge Inc. (TSX:ENB)(NYSE:ENB) is the largest energy infrastructure company in North America. Its portfolio includes the world’s longest crude oil and liquids transportation system, Canada’s largest natural gas distribution company, oil and natural gas storage facilities, and renewable power generation facilities.

Enbridge currently pays a quarterly dividend of $0.61 per share, representing $2.44 per share on an annualized basis, and this gives it a yield of about 4.6% at today’s levels.

As mentioned previously, you must always confirm the safety of a stock’s dividend, and you can do this with Enbridge by checking its dividend payments as a percentage of its available cash flow from operations (ACFFO). In its three-month period ended on March 31, its ACFFO totaled $1.03 per share, and its dividend payments totaled just $0.583 per share, resulting in a conservative 56.6% payout ratio.

On top of being a high and safe yielder, Enbridge is a dividend-growth superstar. It has raised its annual dividend payment for 21 consecutive years, and its recent hikes, including its 10% hike in January and its 4.6% hike earlier this month, have it positioned for 2017 to mark the 22nd consecutive year with an increase.

Enbridge is one of the market’s top picks for dividend growth in the years ahead too. It has a dividend-growth program in place that calls for annual growth of 10-12% through 2024, and I think its very strong ACFFO generation, including $1.03 per share in the first quarter of 2017 and its projected $3.60-3.90 per share in the full year of 2017, and its growing asset base that will fuel future ACFFO growth, including its “$26 billion of secured growth projects in execution and another $48 billion of projects under development,” will allow it to complete this program and announce a new one that extends into the 2030s.

Should you invest $1,000 in Empire Company right now?

Before you buy stock in Empire Company, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Empire Company wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,697.16!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*.

See the Top Stocks * Returns as of 3/20/25

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. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Dividend Stocks

Dividend Stocks

3 Canadian REIT Stocks to Buy and Hold for the Next Quarter-Century

These three Canadian REITs trade cheaply and are highly reliable, making them some of the best stocks you can buy…

Read more »

A train passes Morant's curve in Banff National Park in the Canadian Rockies.
Dividend Stocks

1 Practically Perfect Canadian Stock Down 24% to Buy Now and Hold for Life!

CNR stock is a top Canadian stock for investors, especially with shares down on the TSX today.

Read more »

Canada national flag waving in wind on clear day
Dividend Stocks

The Best Canadian Stocks to Buy Right Away With $30,000

If you have $30,000 you're willing to invest, these are some of the first Canadian stocks to consider on your…

Read more »

rail train
Dividend Stocks

What to Know About Canadian Pacific Railway Stock for 2025

CP stock has now gone through a major merger, so what do investors have to look forward to?

Read more »

ways to boost income
Dividend Stocks

Top Canadian Value Stocks I’d Buy for Dividend Growth and Appreciation

If you are looking for income and capital appreciation, here are three Canadian value stocks for a great total return…

Read more »

coins jump into piggy bank
Dividend Stocks

The Smartest Canadian Stock to Buy With $2,000 Right Now

The company’s powerful combination of growth, income, and value, positions it well to deliver solid returns, making it a smart…

Read more »

Transparent umbrella under heavy rain against water drops splash background. Rainy weather concept.
Dividend Stocks

This 10.6 Percent Dividend Stock Pays Cash Every Single Month

Are you looking to invest for a rainy day? This 10.6% dividend stock pays cash every month, irrespective of the…

Read more »

A worker gives a business presentation.
Dividend Stocks

Market Dip: Opportunity or Risk This April?

This market dip might have investors worried, but should they be excited instead?

Read more »