3 Outstanding Dividend Stocks That Yield Over 5.5%

Canadians can build a rock-solid income portfolio with TC Energy stock, Exchange Income stock, and Sienna Senior Living stock. The three outstanding dividend stocks yield more than 5.5%.

| More on:
Increasing yield

Image source: Getty Images

The 2020 COVID year was a test of resiliency, especially for known dividend payers. Many investors worry about the safety of dividends. If you were to go dividend investing in 2021, three standouts should be on your buy list. Besides enduring the headwinds last year, the dividend stocks yield over 5.5%.

More than a pipeline company

The 70-year-old TC Energy (TSX:TRP)(NYSE:TRP) is well known for its vast natural gas pipeline network and premier liquids pipeline systems. However, the operations of this $60.58 billion Calgary-based company are no longer devoted to pipelines. It’s now one of the largest private sector power generators in the country.

Apart from moving 25% of North America’s daily natural gas consumption, TC Energy owns a portfolio of high-quality, long-life energy infrastructure assets. Its seven power-generation facilities have a combined generating capacity of approximately 4,200 megawatts. Moreover, about 75% of the power capacity is emissionless.

The top-tier energy stock trades at $61.78 per share (+21.4% year to date) and pays a lucrative 5.66% if you were to invest today. A $20,000 investment would generate $1,132 in passive income. François Poirier, TC Energy’s president and CEO, assures investors the company is well positioned to deliver sustainable, high-quality growth in the years ahead.

DDD business model

Exchange Income’s (TSX:EIF) strength comes from a diversified, disciplined, and dependable business model. The $1.58 billion acquisition-oriented company from Winnipeg operates in the aerospace, aviation, and manufacturing sectors.

You might think Exchange Income would slash dividends in 2020 because the global pandemic whipsawed the sectors it serves. Despite the 66% drop in net income versus 2019, management raised dividends for the 15th straight year. The industrial stock lived up to its reputation as a time-tested Dividend Aristocrat.

Current investors are up 11.69% year to date. At $40.13 per share, Exchange Income pays a rock-solid 5.68% dividend. The company has been enjoying diversified revenue streams for a long time. After-market aviation parts, medevac transportation services, communication tower construction, and precision metal manufacturing are among the sales generators.

In Q1 2021 (quarter ended March 31, 2021), revenue dropped by 2% versus Q1 2020. However, Exchange Income reported $7.13 million in net earnings. This dividend stock is a no-nonsense investment.

Government support

Sienna Senior Living (TSX:SIA) was in the centre of the storm in 2020. The rising coronavirus infection cases in long-term-care (LTC) residences and retirement homes, plus the absence of vaccines, were the biggest headaches. Fast forward to June 2021, and the worst could be over.

Since the beginning of the year, active COVID-19 cases among Sienna’s residents declined by nearly 99%. For Q1 2021 (quarter ended March 31, 2021), revenue decreased by 2.7% compared to Q1 2020. However, net income was $10.1 million versus the $2.5 net loss from a year ago.

Sienna will receive an additional $650 million as part of the Government of Ontario’s 2021-22 budget announced on March 24, 2021. Besides the fund to protect LTC residents, the provincial government extended occupancy protection funding until August 2021.

Thus far, Canada’s leading LTC provider has funding support of approximately $2.1 billion. As of May 27, 2021, Sienna trades at $16.22 per share (+17.3% year to date) and offers a generous 5.75% dividend.

High-yield dividend portfolio

The three outstanding stocks are excellent choices for yield-hungry investors. You could form a formidable dividend portfolio in 2021.

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 Christopher Liew has no position in any of the stocks mentioned.

More on Dividend Stocks

A person builds a rock tower on a beach.
Dividend Stocks

CPP Pension: Boost Your Payouts by $5,232 per Year

You can raise your after-tax CPP by making RRSP contributions. Alimentation Couche-Tard (TSX:ATD) is a good RRSP stock.

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

3 No-Brainer Stocks to Buy With $20 Right Now

Here are three no-brainer stocks that are suitable for anyone getting started on their investing journey.

Read more »

growing plant shoots on stacked coins
Dividend Stocks

3 Top Dividend Stocks That Keep Raising Their Payouts

These three TSX stocks are ideal buy as they consistently raise their payouts, depicting their healthy financials.

Read more »

Senior Man Sitting On Sofa At Home With Pet Labrador Dog
Dividend Stocks

This 5% Dividend Stock Pays Cash Every Month

This monthly dividend stock offers cash every month, but also returns that continue to climb higher from being in a…

Read more »

Solar panels and windmills
Dividend Stocks

How Much Will TransAlta Renewables Pay in Dividends This Year?

TransAlta Corporation’s (TSX:TA) acquisition of TransAlta Renewables stock holds significant implications for income-oriented investors who previously held this monthly dividend…

Read more »

Dividend Stocks

3 Stocks That Can Help You to Get Richer in the Next 5 Years

Consistent growth stocks with a relatively bright future are one of the most trustworthy ways to grow wealth.

Read more »

Dividend Stocks

3 Blue-Chip Stocks Every Canadian Should Own

These Canadian blue-chip stocks are backed by well-established businesses and a growing earnings base, enabling them to generate above-average returns.

Read more »

grow money, wealth build
Dividend Stocks

Is This 7.25%-Yielding Dividend Grower the Ultimate Income Stock?

This top Canadian dividend stock has increased the distribution annually for nearly three decades.

Read more »