3 High-Yield TSX Stocks to Buy in March

Despite lower interest rates, generate higher income from dividend-paying TSX stocks offering higher yields.

| More on:
Volatile market, stock volatility

Image source: Getty Images

Despite the gradual improvement in the economy, I expect the interest rates to remain low for an extended period. Thus, it is prudent to generate stable and higher yields from dividend-paying TSX stocks. I have selected three TSX-listed dividend stocks offering high yields that you can consider buying in March. Besides offering higher yields, these companies have been paying dividends for a very long period and generate resilient cash flows, implying that their future payouts are very safe.

TC Energy

TC Energy (TSX:TRP)(NYSE:TRP) has uninterruptedly raised its dividends at a compound annual growth rate (CAGR) of 7% in the last 21 years, which reflects the strength of its resilient cash flows. Its diversified portfolio of regulated and contracted assets generates high-quality earnings and cash flows that support higher dividend payments. 

Its business remained healthy despite the outbreak of the COVID-19 pandemic allowing the company to announce a 7.4% hike in its annual dividends for 2021. TC Energy’s assets remain insulated from short-term volatility in volume throughput and commodity prices, while its utilization levels remain high.

Looking ahead, TC Energy projects 5-7% growth in its dividends in the coming years backed by its regulated and contracted assets. Moreover, its robust development portfolio and $20 billion secured capital program provide a strong base for future dividend growth. The energy infrastructure company pays an annual dividend of $3.48 a share, reflecting a yield of over 6.5%. 

Pembina Pipeline 

Pembina Pipeline’s (TSX:PPL)(NYSE:PBA) exposure to diverse commodities and its highly-contracted assets continue to deliver resilient fee-based cash flows and drive higher dividend payments. The pipeline company has consistently paid dividends over the past 20 years. Meanwhile, it has raised its dividends at a CAGR of more than 4% in the last 10 years. 

Pembina’s fee-based contracts are expected to support its adjusted EBITDA growth in the coming years and drive its dividends. Moreover, its dividend payout ratio is sustainable in the long run. 

I believe increased activity in the conventional pipeline business, increased global energy demand, and multi-billion-dollar capital projects are expected to drive its revenue and earnings, in turn, support share repurchases and dividend growth. The pipeline company pays an annual dividend of $2.52 a share, reflecting a high yield of 7.8% at current price levels. 

Enbridge 

Enbridge (TSX:ENB)(NYSE:ENB) is a top Canadian stock to generate regular passive income, which could continue to grow with you. The energy infrastructure company has paid dividends in the last 66 years. Furthermore, it has uninterruptedly increased it in the past 26 years, reflecting the resiliency of its cash flows and the strength of its core business. 

Enbridge’s over 40 diverse sources of cash flows and contractual arrangements continue to drive its dividends higher. Despite the negative impact of the pandemic, Enbridge recently hiked its dividends by 3% and is currently yielding about 7.8%. 

Enbridge CEO Al Monaco said, “We’ll continue to ratably grow the dividend up to the level of average annual DCF (distributable cash flow) per share growth, while maintaining our dividend policy payout of 60-70% of distributable cash flow.” I believe Enbridge’s secured growth program, momentum in its core business, cost reduction measures and improving energy outlook position it well to deliver robust cash flows and drive its future dividend payments. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends PEMBINA PIPELINE CORPORATION.

More on Dividend Stocks

worry concern
Dividend Stocks

Housing Market in May 2022: Buyers and Sellers Are in a Bind

Many homebuyers are re-evaluating their options due to rising inflation and mortgage rates, but sellers hope they would change their…

Read more »

Money growing in soil , Business success concept.
Dividend Stocks

3 Low-Yield Stocks to Buy for Decent Growth Potential

A low yield doesn't always mean that the company is a miser with its payouts. Sometimes, it's the result of…

Read more »

edit Safety First illustration
Dividend Stocks

3 of the Safest High-Yield Dividend Stocks in Canada

Not all high-yield stocks are inherently dangerous, but it’s still a good idea to play it safe and choose companies…

Read more »

A stock price graph showing growth over time
Dividend Stocks

RRSP Investors: 2 Oversold TSX Stocks to Buy for Dividend Growth

The market pullback is giving RRSP investors a chance to buy some top TSX dividend stocks at cheap prices.

Read more »

stock research, analyze data
Dividend Stocks

Buy the Dip: 2 Top TSX Dividend Stocks on Sale

These top TSX dividend stocks look cheap to buy today for a portfolio focused on passive income.

Read more »

grow money, wealth build
Dividend Stocks

2 Top TSX Growth Stocks That Also Pay Investors Tasty Dividends

Growth stocks on the TSX such as goeasy and Brookfield Renewable also provide investors with tasty dividend yields.

Read more »

money cash dividends
Dividend Stocks

Dividend Stocks: The #1 Way to Earn Passive Income

Earning passive income from dividend stocks could be enjoyable. Here are a few tips to simplify your process.

Read more »

Specialty Brands faces higher raw materials costs.
Dividend Stocks

What’s Next for Premium Brands Stock?

Shares of the specialty food production and distribution company have fallen about 25% since last October.

Read more »