The Motley Fool

3 TSX Dividend Stocks That Can Give You Passive Income for Decades

Image source: Getty Images

Investing in top TSX dividend stocks can help you earn a regular passive income for decades. If you plan to start a passive-income stream that can pay you for life, consider buying the shares of these three TSX-listed Dividend Aristocrats right now. 

Canadian Utilities  

Shares of Canadian Utilities (TSX:CU) are a must-have in your income portfolio. It has the longest track record of annual dividend increases by any publicly listed Canadian stocks and has raised its dividends for 49 years in a row. Canadian Utilities’s robust dividend payments are backed by its diversified and regulated earnings base. 

The company’s regulated assets generate nearly 95% of its total earnings, implying that investors could expect steady growth in its earnings in the coming years that is likely to support its future dividend payouts. 

It has invested billions of dollars into the regulated and contracted asset base that is likely to drive sustainable earnings growth. Moreover, Canadian Utilities expects its dividend to grow at a rate similar to its sustainable earnings growth. It pays a quarterly dividend of $0.44 a share, translating into a high yield of 5.6%. 

Fortis

Like Canadian Utilities, Fortis (TSX:FTS)(NYSE:FTS) has also consistently paid and raised its dividends for a very long period. Its dividends have uninterruptedly increased in the last 47 years, thanks to its high-quality regulated utility assets that generate about 99% of its earnings. 

In its five-year plan, Fortis announced that it expects the rate base to increase at an average annual growth rate of 6% through 2025 and reach $40.3 billion. What it means is that investors could expect steady growth in its dividends over the next five years. Fortis projects its annual dividends to increase by 6% in the next five years.

Fortis’s low-risk and regulated earnings, infrastructure investments, capacity expansion, and growth opportunities in the renewable power business provide a strong base for growth and are likely to drive its earnings. It pays quarterly dividends and offers a decent annual yield of 4%. 

Enbridge

Enbridge (TSX:ENB)(NYSE:ENB) is another top bet to generate consistent dividend income. The pipeline giant has consistently paid dividends for more than 66 years and uninterruptedly raised the same in the last 26 years. Its low-risk business and diversified asset mix position it well to deliver strong distributable cash flows and support higher dividend payments. 

Meanwhile, its approximately $16 billion secured capital program, contractual arrangements, and improvement in global energy demand are likely to push its revenues and earnings higher and, in turn, drive its dividends. Its distributable cash flow (DCF) per share is projected to increase by 5-7% in the coming years, implying that Enbridge’s future dividends could rise in line with the DCF/share. Enbridge stock currently offers a very high dividend yield of 7.6%, which is secure. 

Bottom line

These Dividend Aristocrats have paid and consistently raised dividends for over 25 years. Moreover, their resilient cash flows and high-quality asset base suggest that these companies could continue to give you passive income for decades. 

A $10,000 investment in each of these Dividend Aristocrats at the current price levels would generate a passive income of $1,720/year, which could continue to grow with you. 

But before you Enbridge stock, take a look at this free report now for under-$50 values bets...

Just Released! 5 Stocks Under $49 (FREE REPORT)

Motley Fool Canada's market-beating team has just released a brand-new FREE report revealing 5 "dirt cheap" stocks that you can buy today for under $49 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don't miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.

Claim your FREE 5-stock report now!

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends FORTIS INC.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss an important event.

Iain Butler and the Stock Advisor Canada team only publish their new “buy alerts” twice a month, and only to an exclusively small group.

This is your chance to get in early on what could prove to be very special investment advice.

Enter your email address below to get started now, and join the other thousands of Canadians who have already signed up for their chance to get the market-beating advice from Stock Advisor Canada.

I consent to receiving information from The Motley Fool via email, direct mail, and occasional special offer phone calls. I understand I can unsubscribe from these updates at any time. Please read the Privacy Statement and Terms of Service for more information.