Passive Income: 2 Top Dividend Stocks to Buy Now

Sun Life Financial (TSX:SLF)(NYSE:SLF) and Telus (TSX:T)(NYSE:TU) are two Canadian dividend stocks that are interesting if you want both growth and income.

| More on:
money cash dividends

Image source: Getty Images

If you want to earn passive income through dividend stocks, I suggest two Canadian dividend stocks that are good long-term buys.

Sun Life

Sun Life Financial (TSX:SLF)(NYSE:SLF) is a Toronto-based insurance company providing asset management and wealth management services to clients around the world.  

Its second-quarter 2021 earnings report showed that net income increased to $900 million, up 73% from $519 million in the same quarter last year. Insurance sales increased 35% and wealth sales increased 64%. Asia Group’s net income was $143 million, up 13% from the same period last year. The expansion of Sun Life’s business in Asia combined with the improvement of its business in North America contributed to strengthening its performance.

Return on equity was strong at 16.3%. The company has a strong balance sheet with $3.2 billion in cash and liquid assets as of June 30, 2021.

Sun Life pays a quarterly dividend of $0.55 per share. The second-quarter payout ratio was 37%, so there is ample room for increases. At the time of writing, the stock is trading at almost $65 per share and offers a dividend yield of 3.4%.

Looking ahead, interest rates are expected to rise in the second half of 2022 and continue to rise in the years to come. Higher interest rates tend to be a net benefit to Sun Life, as they increase the return the company can earn on funds held to cover potential insurance claims.

The company’s potential to generate growth, reliable income, and strong overall fundamentals make it one of the most attractive dividend stocks to buy now.


Telus (TSX:T)(NYSE:TU) is a leader in the Canadian communications industry with wired and wireless network infrastructure providing customers with television, internet, and mobile services. 

Telus does not have a media division, but that has not held back the growth of the company. 

Instead, Telus has invested in a healthcare division, which has seen an increase in the use of its services over the past year. Telus Healthcare provides digital solutions to doctors, hospitals, and insurance companies and offers apps and other tools to help healthcare professionals connect with patients in a secure digital environment. The trend towards more e-health services is expected to continue, and Telus is already a leader in this field in Canada.

Telus recently spent nearly $2 billion to buy new spectrum that will support the expansion of the company’s 5G network in the years to come.

Telus is also doing well in terms of its ability to attract and retain customers for its main telecommunications company. For the second quarter of 2021, the company reported 223,000 new net customer additions, better than Rogers and BCE. Telus added 89,000 new mobile phone customers, 84,000 for connected devices, 30,000 for Internet, 19,000 for security and 11,000 new TV client connections.

For the quarter, Telus’s operating revenue increased 10.3% year over year to $4.111 billion and adjusted EBITDA increased 9.5% to $1.490 billion.

Telus stock has a long history of strong dividend growth and attractive total returns, making it one of the best Canadian dividend stocks. While Telus is investing heavily in fibre optic lines and 5G networks, investors should still see the company generating sufficient cash flow to continue increasing distributions. Telus stock is trading near $30 and currently offers a 4.4% dividend yield. The stock tends to hold up well when the broader market falls, as mobile phones and internet are considered essential services nowadays.

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.

The Motley Fool recommends ROGERS COMMUNICATIONS INC. CL B NV and TELUS CORPORATION. Fool contributor Stephanie Bedard-Chateauneuf has no position in any of the stocks mentioned.

More on Dividend Stocks

funds, money, nest egg
Dividend Stocks

The Best Way to Make $1 Million When a Bull Market Returns

Here are five quality TSX stocks investors can buy and hold for the long term, allowing them to increase their…

Read more »

Gold medal
Dividend Stocks

3 Undervalued Winners Just Begging to Be Invested in Today

Three undervalued stocks from three underperforming sectors are winners and screaming buys today.

Read more »

Man data analyze
Dividend Stocks

3 Top Dividend Stocks I Can’t Wait to Buy in 2023

Top Dividend Aristocrats are worth buying in almost every market, especially if you hold them long term. However, weak markets…

Read more »

financial freedom sign
Dividend Stocks

Buy 2,911 Shares in This TSX Stock for a Shot at $1 Million in 32 Years

You might not see insane growth overnight, but you won't see insane drops either from this TSX stock offering a…

Read more »

Dividend Stocks

A Dividend Heavyweight I’d Buy Over Enbridge Right Now

BCE Inc. (TSX:BCE) is a dividend heavyweight I prefer over Enbridge Inc. (TSX:ENB) due to its value and impressive income…

Read more »

Hour glass and calendar concept for time slipping away for important appointment date, schedule and deadline
Dividend Stocks

2 Best Monthly Dividend Stocks for March 2023

There are plenty of monthly dividend stocks to buy right now, but prospective investors should take a closer look at…

Read more »

A bull and bear face off.
Dividend Stocks

The 3 TSX Stocks to Buy Before a Long-Term Bull Market Begins to Build

The TSX may not go bullish for a while, even when the economy recovers from a recession, but investors should…

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

TFSA Investors: Make $200 in Monthly Passive Income With This 1 TSX Dividend Stock

Here’s an attractive dividend stock TFSA investors can buy now to earn $200 in monthly passive income.

Read more »