4 of the Best TSX Dividend Stocks to Buy and Hold Forever

These top TSX dividend stocks have a rich history of dividend payments. Besides, these companies have a solid earnings base.

| More on:
Businessmen teamwork brainstorming meeting.

Image source: Getty Images

Dividend stocks lead to a steady inflow of cash and boost the shareholders’ returns. While plenty of Canadian stocks pay a regular cash dividend, only a few are reliable long-term bets, which you could hold forever. We’ll focus on top TSX dividend stocks that have a rich history of dividend payments. Besides, these companies have a solid earnings base, implying that their payouts are safe and sustainable.

Let’s take a closer look and see what’s driving the dividends of these companies. 

Algonquin Power & Utilities

Algonquin Power & Utilities (TSX:AQN)(NYSE:AQN) is one of the top dividend stocks you can bet on for a growing income stream. Thanks to its high-quality, regulated assets and long-term power-purchase agreements, the company continues to deliver solid earnings and cash flows that drive higher dividend payments. Notably, the utility company has raised its dividends at a CAGR of 10% in 11 consecutive years. Furthermore, it offers a healthy yield of over 4.4%.

Algonquin Power & Utilities projects its rate base to increase by a double-digit rate in the coming five years, implying that its adjusted EBITDA and earnings could mark healthy growth during the same period. Besides, opportunities in the renewable business and strategic acquisitions could bolster its growth rate and drive future dividend payments.

Toronto-Dominion Bank

Investors could consider buying the shares of Toronto-Dominion Bank (TSX:TD)(NYSE:TD) for consistent dividend income. The bank’s ability to consistently deliver solid earnings drives higher dividend payments. Notably, Toronto-Dominion Bank has hiked dividends by a CAGR of 11% in the last 25 consecutive years, which compares favourably to its peers. Furthermore, it offers a dividend yield of 3.7%.

The bank is well positioned to deliver robust earnings growth in the coming years and enhance shareholders’ value over the long term. Its strong balance sheet, diversified business, and increase in loans and deposit volumes are likely to drive its top and bottom lines. Moreover, solid credit performance, lower provisions, and expense management could cushion its earnings. Furthermore, the steady economic expansion is likely to provide a solid growth foundation. 

Canadian Utilities 

Among all the publicly traded Canadian companies, Canadian Utilities (TSX:CU) has the longest track record of increasing its dividend. To be precise, Canadian Utilities has hiked its dividend for 49 years in a row, and it offers a high yield of over 5%. 

The company’s payouts are backed by its regulated and contracted assets that generate predictable cash flows. Its continued investments in the regulated and contracted assets are likely to drive its high-quality earnings base and support its future payouts. Moreover, improvement in its energy infrastructure business and focus on cost containment is likely to support its earnings. 


Fortis (TSX:FTS)(NYSE:FTS) is another well-known dividend stock with a long dividend payment history. Fortis has rewarded its shareholders with higher dividend payments for 47 years and offers a safe yield of 3.6%. Thanks to its rate-regulated earnings and growing rate base, Fortis sees a 6% annual growth in its dividends over the next five years.

Fortis’s low-risk business and diversified asset base provide a solid foundation for continued earnings growth. Meanwhile, it projects its rate base to increase by a CAGR of 6% through 2025, supporting its cash flows and driving future dividend payments. Meanwhile, its continued investments in infrastructure, focus on renewable power business, and inorganic growth opportunities acquisitions position it well to consistently deliver high-quality earnings. 

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends FORTIS INC.

More on Dividend Stocks

A bull outlined against a field
Dividend Stocks

3 Cheap Stocks I’d Buy Before the Bull Market Arrives

Undervalued TSX stocks such as Savaria and Well Health can help investors generate market-beating gains when markets recover.

Read more »

Increasing yield
Dividend Stocks

5 Canadian Dividend Stocks With Yields of 4% or More

If you want dividends that yield over 4%, you don't have to look far. Here are five large-cap Canadian stocks…

Read more »

A worker drinks out of a mug in an office.
Dividend Stocks

3 Blue-Chip Dividend Stocks I’d Buy Over and Over

These three dividend stocks are some of the best stocks to buy right now to create strong income not just…

Read more »

calculate and analyze stock
Dividend Stocks

TFSA: Invest $20,000 and Get $867/Year Without Lifting a Finger

Compound passive income by investing tax-free in your TFSA. Check out this mini-portfolio that could turn $20K into $867/year in…

Read more »

retirees and finances
Dividend Stocks

How to Create a Million-Dollar TFSA in Two Decades

Your TFSA could create riches you didn't know were possible, but only if you commit again and again to your…

Read more »

A plant grows from coins.
Dividend Stocks

TFSA Top Stocks: 2 Cheap Dividend-Payers to Buy Before January Ends

TFSA investors can appreciate dividend-paying stocks like Barrick Gold at these modest valuations.

Read more »

analyze data
Dividend Stocks

3 Top Small-Cap Dividend Stocks to Buy in January 2023

Given their high dividend yields and attractive valuations, the following three small-cap stocks would be excellent buys.

Read more »

exchange-traded funds
Dividend Stocks

2 Ways to Score a Richer Monthly TFSA Payout

These two Vanguard ETFs pay high yields and are steady-paying holdings in a TFSA.

Read more »