When it comes to secure dividend stocks that you can buy and hold for years, there are few options better than the buying into established blue-chip companies. You can do even better and choose companies that are dividend aristocrats: companies with dividend payouts that have increased for five or more consecutive years.
Bank of Montreal (TSX:BMO)(NYSE:BMO) and TC Energy Corp (TSX:TRP) are both such companies. Both are giants in their respective sectors. In October, you may want to look at these stocks, especially if you’re looking to enhance your investment portfolio with dividend-driven stocks.
Bank of Montreal
Standing at fourth place among the Big Five banks, Bank of Montreal boasts a market cap of $61.41 Billion. Sometimes considered the underdog of the pack, the company’s five-year returns come in second place.
These returns are marvelous, especially when compared to the magnitude of the three bigger banks — that was until the last quarter broke.
The last quarter ended on July 31 and the results were lower than expected. The company fell below projected returns, resulting in a dip in the market value. The stock that was trading in three figures until May is valued at $96.12 at the time of writing.
Though the current numbers may appear to paint the company in less desirable colours, they don’t undermine the overall value of the Bank of Montreal.
On the contrary, they may present an excellent buying-in-the-dip opportunity in a blue-chip stock for the company that has been increasing its dividend payment for the past seven years.
The current dividend yield is 4.29%, which is more than the three bigger banks. The company has also taken steps to stay protected against the steadily increasing Provisions for Credit Losses (PCL) numbers in the overall banking industry.
TC Energy Corp
TC Energy is another blue-chip stock to consider buying in October. The company has outperformed its peers in the year 2019, and in the uncertain market of petroleum, TC Energy has seen significant growth. The company increased its net income by 41.16% and diluted EPS by 37.5% since last year.
TC Energy is also a long-standing dividend aristocrat. The company has increased its dividend for the past 15 years. This astounding history sets its long-term investors at ease knowing that the company will deliver on its dividend expectations.
One of the most promising future growth indicators of the company is the completion of Keystone XL, a pipeline that will run halfway through the U.S and is expected to be completed by 2021.
With many small projects scheduled to be completed by the end of the year, TC energy is expected to show steady growth in the coming years.
The stock is currently trading at $68.84 per share, with a dividend yield of 4.36%. This value is expected to grow a bit more to reach its fair value.
Conclusion
Most blue-chip stocks are chosen because of their steady dividend payment and their consistent market value, even through rough financial times.
Bank of Montreal and TC Energy are just these kinds of stocks and more. The potential growth these two super stocks show might be attracting many blue-chip investors in the coming month.
