3 Top Passive-Income Stocks Yielding up to 4.8%

This trio of top dividend plays, including Bank of Nova Scotia (TSX:BNS)(NYSE:BNS), can provide the fat income you need now.

Hello again, Fools. I’m back to highlight three top dividend stocks. As a reminder, I do this because solid dividend stocks

  • provide a healthy income stream in both good and bad markets; and
  • tend to outperform the market over the long run.

The three stocks below offer an average dividend yield of 2.5%. If you spread them out evenly in a $250K RRSP account, the group will provide you with an annual income stream of $6,250 — on top all the appreciation you could earn.

Let’s get to it.

Chugging along

Leading off our list is railroad giant Canadian National Railway (TSX:CNR)(NYSE:CNI), which currently sports a dividend yield of 1.9%.

CN’s diversified cargo base (includes both raw materials and finished goods), massive network of 20,000 miles of track, and high barriers of entry should continue to generate strong cash flows for decades to come.

In the most recent quarter, EPS of $1.73 topped estimates by $0.07 as revenue improved 9% to $4 billion. Looking ahead, management still aims to deliver 2019 adjusted diluted EPS growth in the low double-digit range.

“Our focus on delivering profitable growth and advanced technologies to modernize our scheduled railroading model is expected to continue driving long-term value creation for our shareholders,” said CEO JJ Ruest.

CN shares are up about 12% so far in 2019.

Bank on it

With a dividend yield of 4.8%, financial services gorilla Bank of Nova Scotia (TSX:BNS)(NYSE:BNS) is the next top income play on our list.

Scotiabank’s long-term returns and dividends continue to be supported by a highly regulated banking environment in Canada, massive cost advantages, and an increasingly diversified revenue stream.

In the most recent quarter, EPS of $1.88 beat expectations by $0.03 as revenue increased 11% to $8 billion. Scotia’s key Canadian Banking segment posted double-digit deposit growth while International Banking delivered double-digit earnings growth.

“Meaningful progress was made this quarter to re-position the bank and simplify the operations,” said CEO Brian Porter. “As a result, we are better positioned for growth in our key markets.”

Scotia shares are up roughly 8% so far in 2019.

What a waste

Rounding out our list is waste management leader Waste Connections (TSX:WCN)(NYSE:WCN), which currently offers a dividend yield of 0.7%.

Waste Connections’s highly fragmented operating environment, razor-like focus on exclusive markets, and sheer economies of scale should continue to underpin strong long-term returns and an increasing dividend.

In the most recent quarter, operating cash flow clocked in at a solid $358 million, as revenue increased 10.5% to $1.4 billion. Moreover, operating margin expanded 77 basis points to 17%, suggesting that the company’s competitive position remains strong.

“The strength of our financial profile and free cash flow generation keeps us well-positioned for additional acquisitions and organic growth opportunities, while maintaining the flexibility to increase the return of capital to shareholders,” said CEO Worthing Jackman.

Waste Connections shares are up 20% in 2019.

The bottom line

There you have it, Fools: three top high-yield stocks worth checking out.

As always, don’t view them as formal recommendations. Instead, look at them as a starting point for more research. A dividend cut (or halt) can be especially painful, so you’ll still need to do plenty of due diligence.

Fool on.

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 Brian Pacampara owns no position in any of the companies mentioned. David Gardner owns shares of Canadian National Railway. The Motley Fool owns shares of Canadian National Railway. Bank of Nova Scotia and Canadian National Railway are recommendations of Stock Advisor Canada.

More on Dividend Stocks

woman retiree on computer
Dividend Stocks

1 Reliable Dividend Stock for the Ultimate Retirement Income Stream

This TSX stock has given investors a dividend increase every year for decades.

Read more »

calculate and analyze stock
Dividend Stocks

8.7% Dividend Yield: Is KP Tissue Stock a Good Buy?

This top TSX stock is certainly one to consider for that dividend yield, but is that dividend safe given the…

Read more »

grow money, wealth build
Dividend Stocks

TELUS Stock Has a Nice Yield, But This Dividend Stock Looks Safer

TELUS stock certainly has a shiny dividend, but the dividend stock simply doesn't look as stable as this other high-yielding…

Read more »

profit rises over time
Dividend Stocks

A Dividend Giant I’d Buy Over TD Stock Right Now

TD stock has long been one of the top dividend stocks for investors to consider, but that's simply no longer…

Read more »

analyze data
Dividend Stocks

Top Financial Sector Stocks for Canadian Investors in 2025

From undervalued to powerfully bullish, quite a few financial stocks might be promising prospects for the coming year.

Read more »

Canada national flag waving in wind on clear day
Dividend Stocks

3 TFSA Red Flags Every Canadian Investor Should Know

Day trading in a TFSA is a red flag. Hold index funds like the Vanguard S&P 500 Index Fund (TSX:VFV)…

Read more »

Paper Canadian currency of various denominations
Dividend Stocks

1 Magnificent Canadian Stock Down 15% to Buy and Hold Forever

Magna stock has had a rough few years, but with shares down 15% in the last year (though it's recently…

Read more »

Man holds Canadian dollars in differing amounts
Dividend Stocks

Earn Steady Monthly Income With These 2 Rock-Solid Dividend Stocks

Despite looming economic and geopolitical uncertainties, these two Canadian monthly dividend stocks could help you generate reliable income in 2025…

Read more »