TFSA Investors: 5 Dividend-Growth Giants to Add to Your Portfolio

Fortis Inc. (TSX:FTS)(NYSE:FTS) and these four other dividend stocks have terrific track records for increasing their payouts.

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Stocks that see regular increases in their payouts over time are highly coveted by investors. A stock that pays you 4% today might pay you much more years down the road.

Below are five stocks that have a strong reputation for growing their payouts that would be excellent long-term additions to any portfolio.

Enbridge Inc. (TSX:ENB)(NYSE:ENB) is a top dividend stock that has an excellent track record for growing its payouts. Currently, the pipeline company pays its investors 5.4% per year; however, that could grow significantly over the next few years.

Its quarterly payment of $0.671, which was recently increased, has more than doubled from the $0.315 the company was paying five years ago, which equates to a compounded annual growth rate (CAGR) of 16%. The stock has had a tough year with its share price being down 14% in the past 12 months.

As oil prices continue to rise, Enbridge will give investors the opportunity to benefit from a rising share price and a growing dividend as well.

Telus Corporation (TSX:T)(NYSE:TU) has a strong market position in its industry and is a very safe stock to own as it is not reliant on commodity prices. The company has a small yield at just 4.3%, but its stock has performed better in the past year, producing a return of 7% for investors.

Telus currently pays its shareholders $0.505 every quarter, which is 58% more than the $0.32 it was paying five years ago for a CAGR of 9.5%.

Fortis Inc. (TSX:FTS)(NYSE:FTS) provides investors with a lot of stability, as the utility provider has a strong base of customers and can count on a lot of recurring revenue.

In five years, Fortis has increased its payouts by 37% for a CAGR of 6.5%. Currently, the stock pays investors a little under 4%, and it hasn’t seen much in the way of capital appreciation, as the share price has risen just 27% in the past five years.

Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) could outperform its peers in 2018, especially as the bank expands its operations south of the border. With a dividend of 4.2%, it is one of the higher-paying bank stocks that you can find. In five years, CIBC has raised its dividend by more than 38% for a slightly higher CAGR of 6.7% than what Fortis has achieved.

Bank stocks typically offer investors a lot of stability, and CIBC is no exception with returns of 50% in the past five years. As interest rates continue to rise, banks will continue to cash in on higher spreads and pad their top and bottom lines as a result.

Algonquin Power & Utilities Corp. (TSX:AQN)(NYSE:AQN) is one of the higher-yielding stocks on this list with an annual dividend rate of 4.4%. It’s another utility stock on this list, and for good reason. Algonquin offers investors a lot of stability and could see even more growth than Fortis. In three years, Algonquin’s sales have risen nearly 60%.

Over the past five years, the company’s dividend payments have nearly doubled with a CAGR of 14%. During a period of high valuations and lots of uncertainty, utility stocks can act as safe havens for your money.

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 David Jagielski has no position in any of the stocks mentioned. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada.

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