Are you having a tough time scoping out dividend income from the Canadian stock market these days? Fortunately, there remain a few diamonds in the rough. In fact, in a diverse set of sectors, you can still unlock attractive combinations of income and growth. Here are five top dividend stocks trading below $30 per share, but they all trade with a dividend yield of 3.5% or more.
A Canadian tech turnaround stock
We often don’t correlate income with Canadian technology stocks. Yet that is what makes Sylogist (TSX:SYZ) unique. Today, this stock trades for around $14 per share. It pays an attractive 3.5% dividend. Sylogist provides essential software solutions for public institutions like education districts, governments, and not-for-profit organizations.
It just completed a strategic review and transformed its leadership team. Consequently, it is now focusing on organic and acquisitive growth opportunities in its business universe. This Canadian stock has a great cash-rich balance sheet, a stable recurring revenue base, and it produces a ton of free cash flow. I think Sylogist is in the early stages of a growth-focused turnaround, so now is an attractive entry point.
A top Canadian REIT
For a Canadian real estate stock, Dream Industrial REIT (TSX:DIR.UN) looks very well positioned today. The stock is only $14.70 per unit and trades with a very nice 4.75% dividend.
Dream Industrial owns warehousing, logistics, and distributions properties across Canada, the U.S., and Europe. Tailwinds from e-commerce and the economic recovery are supporting strong rental rate growth and the rise in asset values.
Dream just acquired a very attractive industrial portfolio in Europe. This should fuel opportunities for further expansion there. Compared to Canadian and European peers, this stock trades at a discount, so I still think it is an attractive buy today.
An up-and-coming energy infrastructure stock
Last year, Topaz Energy (TSX:TPZ) was spun out of one of Canada’s largest and most efficient natural gas producers, Tourmaline Oil. It is a picks-and-shovels way to play the rise in energy markets. Topaz garners a very consistent, contracted stream of revenues from both land royalties and natural gas infrastructure assets. The business is overhead-light (only four employees), so it consistently produces a 90% free cash flow margin!
Yet, as natural gas demand rises, Topaz is leveraged to benefit from an increase of production volumes through its assets. This Canadian stock has a great, low-levered balance sheet, so it also has significant capacity to keep growing its asset base. The stock is priced around $17 per share, but it pays a great, growing 5% dividend.
A solid Canadian utility stock
A more green energy stock to own for the long term is Algonquin Power (TSX:AQN)(NYSE:AQN). This stock got a temporary earnings hit due to some power assets being shut down during the extreme Texas winter weather event in February. However, this is a really great, diversified utility to own.
The company is working on an aggressive $9.4 billion capital plan that should accrete 8-10% earnings-per-share growth for the next five years. On top of that, it also has a 3,400 MW greenfield renewable power pipeline that could provide additional upside. The stock trades around $19.50 per share today and pays a 4.3% dividend. This a solid Canadian stock that provides safety, growth, and income.
A telecom with long-term upside
Lastly, Telus (TSX:T)(NYSE:TU) is a great staple dividend stock for every Canadian’s portfolio. Telus has been consistently leading the market in net new customers and is ranked among the best quality networks in the world. Recently, Telus boosted its 2021 capital spend to expand the roll-out of its fibre optic networks. Not only will this also help enable its implementation of 5G technology, but it will provide a meaningful boost to annual EBITDA growth.
Telus is also quickly becoming a leader in various digital verticals. It just IPO’d Telus International, a digital customer experience business. Likewise, Telus Health and Telus Agriculture are becoming substantial businesses in their own right. Telus only trades for $27.50, but investors get a great 4.6% dividend and upside as these verticals mature.
