Amid rising COVID-19 cases worldwide due to the new Delta variant, investors are beginning to worry about the pace of the recovery in economic activities. These concerns have increased the volatility in the equity markets. So, here are four top dividend stocks that you could buy in this volatile environment to strengthen your portfolio and earn stable passive income.
Canadian Utilities
Given its impressive track record, Canadian UtilitiesĀ (TSX: CU) is one of the top dividend stocks to have in your portfolio. It has raised its dividend consistently for the last 49 consecutive years, which is the longest among the Canadian public companies. It earns a significant amount of its cash flows from low-risk utility assets or long-term contracts. So, the company generates stable cash flows irrespective of the broader economic environment, thus empowering it to raise its dividend consistently.
Currently, Canadian Utilities pays a quarterly dividend of $0.4398 per share, with its forward dividend yield standing at 5%. Meanwhile, it has planned to make a capital investment of around $3.2 billion over the next three years, which could expand its rate base. Along with these investments, the acquisition of Pioneer Natural Gas Pipeline could boost its financials in the coming quarters. So, I believe Canadian Utilities is well equipped to continue raising its dividend.
NorthWest Healthcare
Another stock investors should buy in this volatile environment would be NorthWest Healthcare Properties REITĀ (TSX:NWH.UN), which pays a monthly dividend at a healthier yield. It owns and operates healthcare properties across seven countries. So, given its diversified and defensive portfolio, the company’s cash flows are stable. Its government-backed tenants, inflation-index rent, and long-term agreements provide stability to its financials.
Meanwhile, NorthWest Healthcare is working on expanding its operations in Australia and Europe. It recently raised over $200 million, which could aid in acquiring the Australian Unity Healthcare Property Trust and four healthcare facilities in the Netherlands. So, these acquisitions could increase its cash flows, thus allowing the company to continue paying its dividend at a healthier yield. Meanwhile, NorthWest Healthcareās forward dividend yield currently stands at a juicy 6.1%.
BCE
Amid increasing digitization, the need for a faster and reliable internet connection is rising. So, I believe 5G could be a big growth driver in the coming years. So, ahead of the 5G revolution, BCE (TSX: BCE)(NYSE: BCE) would be an excellent buy right now. Meanwhile, the company has planned to spend an additional $1.7 billion in this and next year to advance its fiber, wireless home internet, and 5G networks.
Currently, the company provides 5G service to over 35% of the Canadian population. However, it has planned to expand the service to 75% of the population by the end of this year. Along with these investments, the recovery in economic activities could boost the demand for its services while driving its financials. So, I believe BCEās dividends are safe. Meanwhile, the company’s forward dividend yield stands at an attractive 5.67%.
TC Energy
My final pick is TC EnergyĀ (TSX: TRP)(NYSE: TRP), which has delivered an average annual total shareholders return of 12% since 2000. The midstream energy infrastructure company operates a highly regulated business, generating healthy cash flows and thus raising its dividends consistently for 21 straight years at a CAGR of 7%. TC Energy currently pays quarterly dividends of $0.87 per share, with its forward dividend yield standing at 5.56%.
Meanwhile, TC Energy has planned to spend around $20 billion over the next four years, with approximately $7 billion worth of projects in the developmental stage. These investments could expand its rate base. The recovery in energy demand could increase its asset utilization rate, thus driving its financials in the coming years. So, I am bullish on TC Energy.
