The third-wave pandemic shed 68,000 jobs in Canada in May. Most are part-time work. The unemployment rate remained pretty much stagnant at 8.2%.
If you’ve got savings down your belt, you should highly consider putting some of your savings into dividend stocks. Learning about investing and researching stocks can be like part-time work or a hobby that makes you money. Much of that can come from dividend income, which can be a semi-passive endeavour.
It used to be really costly to trade stocks. That’s no more since the advent of online brokerage services. You can buy or sell stocks at $0 to $10 per trade nowadays. Wealthsimple costs $0. The Canadian banks costs up to $10. And you pay something in between at somewhere like Questrade.
If you’re new to dividend investing, there is plenty of free content online around the topic, including articles and even an older version of Lowell Miller’s The Single Best Investment book in PDF format!
Here’s a list of dividend stocks you would be interested in. Search for Canadian Dividend Aristocrats. They’re Canadian dividend stocks that have a track record of increasing their dividends.
Renewable energy stocks that provide decent dividend yields of about 3-4% have pulled back recently. So, they might be a good starting point for investigation.
Innergex Renewable Energy
Innergex Renewable Energy (TSX: INE) stock has pulled back 36% from its high of $32 per share. It currently yields 3.5%. It has increased its dividend for seven consecutive years with a five-year dividend-growth rate of 3%.
The utility has about 3,700 MW of gross installed capacity across 76 facilities across wind, solar, and hydro. Innergex operates in Canada (about 53% of capacity), the U.S. (32%), France (9%), and Chile.
In the last quarter, it reported revenue of almost $190 million and adjusted EBITDA of $143 million that increased 43% and 58%, respectively, year over year. Its last-12-month revenue and EBITDA growth of approximately 19% is more normalized.
Across the average 12-month price target of 10 analysts, the stock has 19% near-term upside potential.
Notably, Innergex has an S&P credit rating of BB+, which isn’t investment grade and could lead to a lower valuation on the stock compared to its peers.
Brookfield Renewable Energy
Brookfield Renewable Energy (TSX: BEP.UN)(NYSE: BEP) stock has declined about 24% from its high of about $62.50 per share. It currently yields 3%. It has increased its dividend for 11 consecutive years with a five-year dividend-growth rate of 5.5%.
Management is committed to increasing its cash distribution per unit by 5-9% per year. This can be achieved from organic growth and its ongoing capital-recycling strategy as a value investor.
Brookfield Renewable has an operating capacity of close to 21,000 MW across North America, South America, Europe, and Asia. It has plenty of growth potential. Specifically, its development pipeline across those diversified geographies is more than double that size!
The utility is awarded an investment-grade S&P credit rating of BBB+.
Algonquin Power & Utilities
Algonquin Power & Utilities (TSX: AQN)(NYSE: AQN) stock has corrected roughly 16% from its high of about $22.50 per share. It currently yields 4.4%. It has increased its dividend for 10 consecutive years with a five-year dividend-growth rate of 10%.
Algonquin has a renewable energy segment with long-term contracts and a regulated utilities segment. The two portfolios should lead to stable earnings and cash flow generation.
The dividend stock is awarded an investment-grade S&P credit rating of BBB.
