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TFSA Investors: 2 Dividend Stocks Yielding Up to 10.3% to Buy Now

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If you’ve got room in your Tax-Free Savings Account (TFSA), now may be a good time to start adding some high-yielding dividend stocks to it. With many income-generating stocks down this year due to COVID-19 and a poor economic outlook, there are some good deals out there and many yields are much higher than normal. Here are two investments worth a closer look as now could be a great time to scoop them up:

CIBC

Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) is down 4% year to date as the top bank stock is still recovering from the market crash back in March. A big part of the reason is that investors are concerned about financial stocks amid a recession. In its most recent quarterly results for the third quarter and up until July 31, CIBC’s net income of $1.17 billion was down 16% from the prior-year period. The top bank’s financials suffered from an increase in provisions for credit losses as well as a decline in client activity.

However, the numbers were still better than in the second quarter, when net income was just $392 million, showing that perhaps the worst may be over, at least for now, for CIBC. That’s where buying the stock today could be a good move, as it continues its recovery. CIBC currently pays a quarterly dividend of $1.46, which yields 5.6%. While not as high as it was a few months ago when its share price was even lower, it’s still higher than where it’s normally been over the years:

CM Dividend Yield Chart

CM Dividend Yield data by YCharts

True North

True North Commercial Real Estate Investment Trust (TSX:TNT.UN) is another stock that’s been hit hard this year. Down 20% year to date, it still hasn’t recovered from the crash that took place in March. Real estate investment trusts (REITs) haven’t gotten much love from investors this year as talk of tenants not paying rent and businesses shutting down has made many investors question how safe REITs are amid the pandemic.

However, True North is one of the safer REITs out there. In the second quarter, the company reported occupancy rates of 97% for its portfolio. Its tenants include the federal and provincial governments and other credit-rated tenants, enabling the REIT to collect 99% of its rent for Q2 as well as for July. Its funds from operations (FFO) per unit of $0.15 remained unchanged from the same period last year. Despite the bearishness, the stock proves to be a stable investment even with the pandemic causing problems for many businesses.

Its monthly dividend payments of $0.0495 remain intact and are yielding 10.3% and can add a wealth of recurring income to your portfolio on a regular basis. Like CIBC stock, it’s not often that True North pays a dividend yield this high:

TNT.UN Dividend Yield data by YCharts

Bottom line

Either one of these two stocks can be good investments to buy right now for your TFSA. With their values down this year, it can give you an opportunity to get a better-than-normal dividend yield while also potentially profiting from capital gains later on as they’re likely to rise in value as the economy recovers.

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Fool contributor David Jagielski owns shares of True North Commerical Real Estate Investment Trust

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