4 Top Dividend Aristocrats to Invest in Today

Start to build long-term wealth by forming a portfolio composed of Dividend Aristocrats. Royal Bank of Canada stock, Canadian National Railway stock, Emera stock, and TFI International stock are the top four today.

| More on:
Gold king in chess game face with the another silver team on black background (Concept for company strategy, business victory or decision)

Image source: Getty Images

The best approach to generating income in the stock market is dividend investing. However, you can only achieve true success by limiting your holdings in your basket to low-risk investments.

Royal Bank of Canada (TSX:RY)(NYSE:RY), Canadian National Railway (TSX:CNR)(NYSE:CNI), Emera (TSX:EMA), and TFI International (TSX:TFII)(NYSE:TFII) can form your “fantastic four.” All these companies are Dividend Aristocrats, and only one isn’t cross-listed on the New York Stock Exchange.

Top-tier asset

Canada’s largest bank stood tall again in Q3 fiscal 2021 (quarter ended July 31, 2021). RBC’s net income rose 34% to $4.3 billion versus Q3 fiscal 2020. All business segments reported profit growth, with Personal & Commercial Banking reporting a 55% increase from a year ago.

Also, the blue-chip asset is the top performer in the banking sectors thus far in 2021 (+30.07%). At $132.28 per share, the $188.46 billion bank pays a decent 3.27%. RBC also ended the third quarter with surplus cash of $69.2 billion. A dividend increase is possible if the banking regulator lifts restrictions soon.

Economic driver

CNR pays only a 1.77% dividend, but it shouldn’t be a reason to pass up on the large-cap stock. The $98.7 billion company boasts the only transcontinental railway in North America. Moreover, it could soon merge with Kansas City Southern barring any hitches in the takeover bid.

The bidding war with Canadian Pacific Railway to acquire the American railway operator is still ongoing. Nonetheless, with or without the deal, CNR is vital to the economy. It transports over $250 billion worth of goods in North America annually. In the last 24.78 years, the stock’s total return is 4,692.33% (16.9% CAGR).

Recession-proof

Emera in the utility sector is recession-proof. The $15.26 billion company takes care of electricity and gas generation, transmission, and distribution in North America. About 2.5 million end-users in the U.S., Canada, and the Caribbean depend on Emera.

At $59.51 per share, the dividend offer is a generous 4.28%. Management looks to achieve a rate base growth of between 7.5% and 8.5% through 2023. The company will spend roughly $2 billion this year to raise the rate base to 6%. Its total capital budget until 2023 amounts to $7.4 billion. Likewise, it plans to increase dividends by 4-5% annually through 2022.

A platform for growth and profitability

TFI International is the top-performing Dividend Aristocrat today with its incredible 118.7% year-to-date gain. The industrial stock trades at $142.50 per share and pays a modest 0.88% dividend. This $13.25 billion transportation and logistics company has a vast e-commerce network covering 80 cities in North America.

In Q2 2021, TFI impressed investors with a 398% and 226% increase in net income and operating income versus Q2 2020. According to its chairman, president, and CEO Alain Bédard, all the business segments reached new heights during the quarter.

Despite the unprecedented events in 2020, management’s strategy created a platform for growth and profitability. The promise in the second half of 2021 is the strong execution of the business strategy and generating robust cash flow to enhance shareholder value further.

Buy and hold

A stock portfolio filled with Dividend Aristocrats will help you reduce market risks and maximize returns. Furthermore, the four stocks in focus are all buy-and-hold stocks. You can reinvest the dividends to amass a fortune in the long run.

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. The Motley Fool recommends Canadian National Railway and EMERA INCORPORATED.

More on Dividend Stocks

grow money, wealth build
Dividend Stocks

2 Ultra-High-Yielding TSX Stocks to Buy With $1,000

You don’t need thousands to start investing. Here are two super high-yielding TSX stocks to buy now that can provide…

Read more »

Business success with growing, rising charts and businessman in background
Dividend Stocks

How to Turn $15,000 Into Reliable Passive Income for Decades

If you only have $15,000 to invest today, here’s a mini portfolio that could produce passive income annually (and potentially…

Read more »

man slides
Dividend Stocks

TFSA Investors: Where to Put That New $6,500 Contribution Room

These stocks may be trading high, but they still offer value for TFSA investors seeking out the best stocks to…

Read more »

Dividend Stocks

2 TSX Companies With Dividends That Outpace Inflation

The stellar yields of these Canadian dividend stocks make them an attractive investment amid a high inflationary environment.

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Dividend Stocks

1 Overlooked Dividend Stock (Yielding 5.6%) to Buy in January 2023

Great-West Lifeco Inc. (TSX:GWO) is an underrated dividend stock that warrants the attention of investors in early 2023.

Read more »

stock analysis
Dividend Stocks

1 Oversold Dividend Stock (Yielding 3.24%) to Buy in January 2023

Looking for a deal? This dividend stock is still near oversold territory, with a dividend I'd lock up right now.

Read more »

edit Business accounting concept, Business man using calculator with computer laptop, budget and loan paper in office.
Dividend Stocks

5 Top Dividend Stocks to Buy With Decades of Passive-Income Potential

Any Canadian investor can enjoy passive income from these dividend stocks that tend to increase their payouts over time!

Read more »

value for money
Dividend Stocks

3 TSX Stocks That Are Too Cheap to Ignore

You can buy cheap TSX stocks such as Suncor and Nuvei right now to enjoy outsized gains once the markets…

Read more »