The Motley Fool

TFSA Investors: 3 Stocks Yielding up to 10.5% That I’d Buy Right Now

If you’re in need of dividend stocks to fill your TFSA, then there’s no better time than now to go shopping. The recent decline in stock prices has sent dividend yields up, and that may not last if share prices rebound in the coming days and weeks. Below are three stocks that have struggled recently and that are yielding as high as 10.5% per year that you should consider adding to your portfolio today.

AltaGas (TSX:ALA) has been performing very poorly in 2018, as the stock is down more than 25% since the start of the year. That has brought its already high yield to a whopping 10.5%, and with monthly payouts it could be a great dividend stock to hold if you’re looking for a monthly stream of income.

The company is set to release its third-quarter results later this month and a good result could send the stock back on the right path. AltaGas stock has been oversold for a while and given its strong financials and prospects for growth, it’s only a matter of time before investors start to scoop up this deal. With oil prices continuing to rise and AltaGas being able to generate strong free cash flow, there will be many opportunities for the company to continue to grow.

The oil and gas industry has taken a beating in Canada in recent years, and that makes the stocks very fairly priced. AltaGas is currently trading around its book value, but you shouldn’t expect that to last for long.

Shaw Communications (TSX:SJR.B)(NYSE:SJR), like many telecom stocks, has struggled for much of the year, dropping more than 15% so far. As a result of the decline, Shaw’s stock now pays investors 4.9% on an annual basis, and it too provides its shareholders with monthly payouts.

What makes Shaw a bit more appealing than its peers is that the company has recently got into the wireless industry and its Freedom Mobile is still in its early growth stages. However, with Shaw’s strong financial resources, there’s plenty of potential for Freedom to start taking significant market share away in an industry that has been dominated by just a handful of players.

Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) is down about 12% since the start of the year and the stock is a bargain, trading at just 1.5 times its book value and less than 11 times earnings. It offers investors good value and it’s very modestly priced, even for a bank stock. Like the other stocks on this list, Scotiabank has tremendous opportunities for growth, as it invests in growing Latin American markets that have lots of potential in the years to come.

With the drop in price and a recent hike in its dividend, Scotiabank now pays investors a very attractive 4.8% yield, which is very high for a bank stock. Scotiabank is a great long-term hold, as in five years its dividend has increased by 37% for a compounded annual growth rate of 6.5%.

This is an underrated bank stock that doesn’t get the same hype that some of its peers do, but that just makes it that much better of a deal.

Our #1 Stock to Buy in 2018 (and Beyond!)

When you buy heavily cyclical stocks at low prices… and then hold the shares until the cycle reaches its peak… you can make a very healthy profit.

Every investor knows that. But many struggle to identify the best opportunities.

Except The Motley Fool may have a plan to solve that problem! Our in-house analyst team has poured thousands of hours into their proprietary research – and this is the result.

Our top advisor Iain Butler has just identified his #1 stock to buy in 2018 (and beyond).

The last time this stock went from the low point of its cycle to the peak… shares shot from $12 to $40 inside of 4 years. That’s an 300%-plus return. And if you missed out on that ride, today might just be your second chance.

Click here to claim Iain’s new report, absolutely FREE!

Fool contributor David Jagielski owns shares of ALTAGAS LTD. AltaGas is a recommendation of Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.