4 Safe Canadian Dividend Stocks to Buy Right Now

Amid an uncertain outlook, you can strengthen your portfolio with these four safe dividend stocks.

Cogs turning against each other

Image source: Getty Images.

Amid reports of large-scale unwinding by Archegos Capital Management late last week after facing margin calls, global equity markets were down yesterday. Investors are worried about the ripple effect it could have on the broader equity markets. The rising COVID-19 cases are also weighing on the equity markets. So, amid the uncertain outlook, here are four safe dividend stocks you can buy right now to strengthen your portfolio.

Fortis

Fortis (TSX:FTS)(NYSE:FTS) operates a low-risk transmission and distribution service, providing electricity and natural gas to 3.3 million customers. With 83% of its revenue protected from regulated mechanisms, its earnings and cash flows are largely stable. These stable cash flows have allowed the company to raise its dividends for 47 consecutive years. Currently, the company pays quarterly dividends of $0.505 per share, with its dividend yield standing at a healthy 3.7%.

Meanwhile, the company has planned to invest $19.6 billion over the next five years, driving its rate base and earnings growth. Supported by these investments, Fortis’s management hopes to raise its dividends at a CAGR of 6% during this period. So, I believe Fortis is an excellent defensive bet.

Canadian Utilities

Canadian Utilities (TSX:CU) operates low-risk utility assets and is also involved in the power production and storage business. Meanwhile, the company sells over 80% of its power through long-term contracts, shielding its financials from price and volume fluctuations, thus delivering stable and predictable earnings and cash flows. These stable cash flows have allowed the company to raise its dividends for 49 consecutive years while offering a high yield of 5.1%.

Meanwhile, the company has planned to invest $3.2 billion over the next three years, increasing its rate base and boosting its financials. Further, its focus on cost efficiencies, and Pioneer Pipeline’s acquisition in September 2020 could also drive its earnings in the coming years. So, given its growth prospects, I believe the company could continue raising its dividends.

BCE

My third pick would be one of the three largest telecommunication service providers in Canada, BCE (TSX:BCE)(NYSE:BCE). With telecommunication service becoming essential in today’s digitally connected world, BCE would be an excellent defensive bet. The improvement in economic activities amid the ongoing vaccination drive could boost its financials in the coming quarters.

Further, the company has planned to invest at least $1 billion over the next two years to expand its broadband fibre and wireless networks. The management hopes to double its 5G coverage this year while adding 900,000 new fibre and wireless home internet connections. So, given its growth prospects and recession-proof business model, I believe its dividends are safe. BCE has announced to pays dividends of $3.50 per share in 2021, with its dividend yield currently standing at an impressive 6%.

NorthWest Healthcare

My final pick would be a real estate company, NorthWest Healthcare Properties REIT (TSX:NWH.UN), which acquires and manages healthcare properties across various countries. Thanks to its diversified and defensive portfolio, the company enjoys high occupancy and collection rate, delivering stable and predictable cash flows.

Meanwhile, most of its tenants have signed long-term agreements, with an average lease expiry of 14.5 years, thus reducing vacancies. Further, over 80% of its tenants are backed by government funding, which is encouraging. The company had recently raised approximately $220 million through new equity offerings. It expects to utilize the proceeds to lower its debt and make new acquisitions. So, given its long-term agreements and new acquisitions, the company could continue raising its dividends in the coming years. Currently, NorthWest Healthcare pays monthly dividends of $0.067 per share, with its forward dividend yield standing at 6.2%.

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.

The Motley Fool recommends FORTIS INC and NORTHWEST HEALTHCARE PPTYS REIT UNITS. Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned.

More on Dividend Stocks

grow dividends
Dividend Stocks

3 Canadian Stocks With a Real Chance of Doubling Your TFSA’s Value

Three outperforming Canadian stocks can help TFSA investors double their account balances.

Read more »

Hand writing Time for Action concept with red marker on transparent wipe board.
Dividend Stocks

3 No-Brainer Stocks I’d Buy Right Now Without Hesitation

At any given time, the market may have certain stocks that offer a powerful combination of reliability, potential, valuation, etc.,…

Read more »

money cash dividends
Dividend Stocks

This 8.39% Dividend Stock Can Pay $100 Cash Every Month

Consider investing in this monthly dividend stock at current levels to lock in high-yielding monthly distributions to create a good…

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

Here’s the Average TFSA Balance in 2024

The Bank of Montreal (TSX:BMO) says that the average TFSA balance is $41,510, far below the maximum.

Read more »

A glass jar resting on its side with Canadian banknotes and change inside.
Dividend Stocks

Investors: Here’s How to Make $1,000 Each Month in Retirement

Here's how you can easily make $1,000 in monthly passive income in retirement in Canada, without taking on too much…

Read more »

man touches brain to show a good idea
Dividend Stocks

3 No-Brainer TSX Stocks I’d Buy Right Now Without Hesitation

Three TSX stocks that continue to overcome massive headwinds and beat the market are no-brainer buys right now.

Read more »

calculate and analyze stock
Dividend Stocks

TFSA Investors: 2 Top TSX Dividend Stocks to Buy on a Dip and Hold Forever

These top TSX dividend stocks now offer attractive yields and big potential capital gains.

Read more »

grow money, wealth build
Dividend Stocks

1 Dividend Stock to Buy for Growth and Stay for a 5.5% Yield

This dividend stock has been rising higher, but more could certainly be on the way. Now is the time to…

Read more »