Not every stock you buy for your portfolio will be a dividend stock. However, dividend stocks are some of the best and most important businesses to buy if you want to build a balanced portfolio.
Many of the best dividend stocks — especially those on the Dividend Aristocrats list — will be massive companies with excellent operations allowing them to grow their profit and dividend each year.
They are also generally excellent long-term growth stocks and stable businesses that are less volatile than the rest of the market. Not to mention you can count on them to continue earning strong cash flow through times of economic turmoil.
So if you’re looking for some of the top stocks to buy for your portfolio and hold long-term, these three dividend stocks are some of the best in Canada.
These two blue-chip stocks are some of the best for dividend investors to buy
Some of the best Canadian stocks to buy are massive infrastructure businesses. The infrastructure industry consists of any asset or facility that aids in the functioning of society. So energy transportation companies, telecommunications, and utilities are all examples of infrastructure companies. And in many cases, these three industries consist of some of the best dividend stocks to buy.
Take Enbridge (TSX: ENB)(NYSE: ENB) and BCE (TSX: BCE)(NYSE: BCE), for example. One of the main reasons I own both stocks and recommend them to investors so often is because their operations are crucial to our economy. Furthermore, because they are massive infrastructure companies, they have long-life assets that allow them to be major cash cows.
Enbridge owns pipelines that earn cash flow for years and require little maintenance. This is similar to telecommunications infrastructure, which earns BCE cash for years, and also requires little maintenance.
Another reason these two dividend stocks are some of the best to buy is that they operate in industries with considerable barriers to entry. For example, you can’t just start a telecommunications company or build a pipeline. In addition to the fact that you would need tonnes of capital, there are several regulations in each industry.
So these companies have essential services, long-life assets that allow them to consistently earn tonnes of cash flow and operate in industries with massive barriers to entry. This is why they are such excellent companies and some of the top stocks to own long-term.
Plus, both pay an exceptional dividend. Enbridge currently yields around 6.3%, while BCE currently yields approximately 5.5%. And, of course, both are Dividend Aristocrats. So if you’re looking for a top dividend stock to buy today, these two are some of the best in Canada.
A top financial stock for long-term growth
Another high-quality Canadian dividend aristocrat stock to consider is Brookfield Asset Management (TSX:BAM.A)(NYSE: BAM). While Enbridge and BCE earn most of the income for investors by paying back a dividend, Brookfield is more focused on growing its value and therefore the capital appreciation for investors.
It’s a much different type of dividend stock. However, it’s still a Dividend Aristocrat, and one of the best Canadian stocks to buy and hold for years. Because Brookfield doesn’t return nearly as much to investors (the stock currently yields just 0.9%); it uses that cash to invest in new business that it thinks can help grow investors’ value.
For years it’s been one of the top performers on the market, making it an excellent investment company to give investors global exposure. In addition to its asset management business, it also invests in industries with tonnes of long-term growth potential, such as renewable energy and infrastructure. And going forward, the company is now looking at expanding the industries it invests in to also include technology and insurance.
Brookfield has proven time and again that it’s one of the best Canadian stocks to buy, dividend-paying or not. The company is massive, which gives it incredible deal flow. Plus, its strategy is to always invest for the long run, making it the ideal company to own for long-term investors.
