Here Are the Best Dividend Stocks to Buy Now

Markets are looking volatile today. This should drive investors to top dividend stocks like Manulife Financial Inc. (TSX:MFC)(NYSE:MFC).

Ambrose O'Callaghan

Ambrose O'Callaghan graduated with a BA in Political Science from McMaster University. After that, he jumped into the banking world. He worked from the front line to an investment associate role. After that, he found a way to marry his experience and knowledge in the world of banking and finance to his love and passion for writing. Ambrose is a passionate believer in Warren Buffett's value investing model.

Published January 30, 2021 5:00 pm EST

The S&P/TSX Composite Index came back strong and rose 232 points on January 28. Still, North American indexes have entered a new period of volatility to start 2021. A retail investor frenzy has sparked momentum for U.S. equities like GameStop and AMC Entertainment. Today, I want to explore more stable dividend stocks that are worth stashing for the long term. These provide stability, income, and attractive value right now.

Why Manulife is one of the best dividend stocks on the TSX

Manulife Financial (TSX: MFC)(NYSE: MFC) is still one of my favourite dividend stocks on the TSX. This is one of the largest insurance and financial services companies in Canada. Its shares are down 7.2% year over year as of close on January 28.

The company is expected to release its fourth-quarter and full-year 2020 results on February 11. In Q3 2020, Manulife reported core earnings of $1.6 billion. That was down 6% from the third quarter of 2019. Global WAM outflows shrank to $2.2 billion compared to outflows of $4.4 billion in the prior year. Moreover, Manulife has continued to achieve promising market penetration in the Asia region.

Shares of this dividend stock possess a very attractive price-to-earnings (P/E) ratio of 8.9 and a price-to-book (P/B) value of 0.9. Manulife offers a quarterly dividend of $0.28 per share. That represents a solid 4.7% yield.

Don’t sleep on this bank stock that offers big income

Canadian Imperial Bank of Commerce (TSX: CM)(NYSE: CM) is the fifth largest of the Big Six Canadian banks. It is also one of the strongest dividend stocks available on the TSX. Shares of CIBC have increased 15% over the past three months. Investors can expect to see its first-quarter 2021 results in late February.

The bank delivered some promising news in its Q4 and full-year 2020 results. CEO Victor Dodig said that client applications had recovered from lows earlier in 2020 and were now generating growth. CIBC reported adjusted earnings per share of $2.79 — down marginally from $2.84 in the previous year. This exceeded analyst expectations.

Shares of this dividend stock last had a solid P/E ratio of 13 and a P/B value of 1.3. Moreover, CIBC offers a quarterly dividend of $1.46 per share. This represents a strong 5.3% yield.

This top dividend stock offers exposure to the green energy space

TransAlta Renewables (TSX: RNW) is the last dividend stock I want to look at today. This week, I’d explained why Canadians should look to get in on the green energy revolution. The company develops, owns, and operates renewable power-generation facilities.

In Q3 2020, TransAlta saw comparable EBITDA increase 12% year over year to $96 million. Meanwhile, adjusted funds from operations (AFFO) rose 10% to $76 million. In December, the company announced the acquisition of two wind and one cogeneration facilities. Investors can expect to see the company’s fourth-quarter and full-year 2020 results in late February.

TransAlta offers a monthly dividend of $0.078 per share. That represents a 4.2% yield.