When it comes to creating the perfect portfolio, one option investors inevitably need in their arsenal is dividend stocks. These passive-income producers provide investors with quarterly or even monthly income that they can then use to either reinvest or cash out.
If you’re starting up a portfolio or just looking for some new options for dividend stocks, then there are a few things you should look out for, as outlined by fellow fool writer Nelson Smith. The dividend stocks should trade on the S&P/TSX Composite, have a minimum market capitalization of $300 million, and have a five-year history of dividend increases.
So, here are three options that fit into this category for investors to add to their own passive-income arsenal.
I had recommended buying up Crombie Real Estate Investment Trust (TSX:CRR.UN) a few months back, as the company that owns a number of grocery stores recently made a shift. Crombie is in the process of adding residential buildings on top of its existing grocery properties, meaning it will be bringing in a tonne of rental fees in the near future.
The stock has since popped up 24% since December of 2018, reaching prices not seen since 2016 and still room to grow. The stock offers shareholders a dividend yield of 5.77% as of writing, and while that hasn’t increased in the last five years, it likely will moving forward as the stock continues to bounce back.
Another dividend all-star I would recommend is Enbridge (TSX:ENB)(NYSE:ENB), which I also recommend for its future outlook of exceptional growth. The company has $16 billion in secured growth projects that should all be online by 2021, as the company tries to move past a slew of new environmental regulations to get those pipelines underway.
When they finally are under construction and the oil and gas industry improves, shares of Enbridge should skyrocket. The stock is trading well below fair value at $46.17 as of writing, with a potential upside of 45% in the next 12 months. Meanwhile, it offers investors a 6.34% dividend yield that has increased 110% in the last five years, with 8-10% in increases through to 2021.
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Finally, we have Fiera Capital (TSX:FSZ), an asset management firm that has grown from $29 billion in assets under management in 2011 to $150 billion as of writing. Much of this has come from the growth-by-acquisitions strategy the company has been undertaking over the years, with 10 since 2016, and it doesn’t seem to be slowing down.
The company had some net losses in the last quarter, which turned off investors, but that makes now a great time to buy. The stock offers investors a 7.72% dividend yield that has risen every year since 2013.
For a perfect trio of passive-income producers that promise high payouts and steady stock increases, you can’t get much better than these three. The combination offers investors a diversified portfolio that should seriously pick up over the next few years and hand out strong dividends in the meantime.
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 Amy Legate-Wolfe owns shares of ENBRIDGE INC. The Motley Fool owns shares of Enbridge. Enbridge is a recommendation of Stock Advisor Canada.