With the Federal Reserve expected to increase interest rates this year, the equity market could remain volatile. So, investors can strengthen their portfolios and earn stable passive income by investing in the following four dividend stocks. Given their strong cash flows and regular payouts, these four companies are less susceptible to market volatilities.
Enbridge
Enbridge (TSX: ENB)(NYSE: ENB) has been paying dividends uninterruptedly for 67 years. Supported by its 40 diverse and regulated revenue-generating assets, its cash flows are stable and predictable, thus allowing it to increase its dividend for the previous 27 years. Currently, it pays a quarterly dividend of $0.86 per share, with its forward yield standing at 6.40%.
Meanwhile, Enbridge has sanctioned $1.1 billion of new capital projects and expects to invest up to $6 billion annually on conventional low-capital-intensive projects and low-carbon organic growth opportunities through 2024. Supported by these investments, the company’s DCF per share could grow at an annualized rate of 5-7%. Its financial position looks healthy, with its liquidity at $10 billion. So, given its high dividend yield, impressive track record, stable cash flows, and healthy growth prospects, Enbridge could be an excellent bet in this volatile environment.
BCE
Amid growing digitization and increased remote working and learning, the demand for telecommunication services is rising. So, given the favourable business environment, I have selected BCE (TSX: BCE)(NYSE: BCE) as my second pick. With its addressable markets expanding, the company has accelerated its capital investment to strengthen its 5G and broadband infrastructure. These investments could drive its financials in the coming quarters.
BCE’s growing customer base and higher recurring revenue stabilize its financials and cash flows. Supported by these robust cash flows, the company has raised its dividend at an annualized rate of over 6% in the last 10 years. Meanwhile, its forward dividend yield currently stands at a healthy 5.27%. BCE’s financial position looks healthy, with its liquidity standing at $6.1 billion. So, I believe the company’s dividend is safe.
NorthWest Healthcare Properties REIT
NorthWest Healthcare Properties REIT (TSX:NWH.UN) could be another excellent stock to buy in this volatile environment. It owns and operates healthcare real estate spread across seven countries. Given its high-defensive portfolio, long-term contracts, and government-supported tenants, it enjoys higher occupancy and collection rate irrespective of the economic cycle. So, its solid financials and cash flows have allowed the company to pay its dividend at a healthier yield. Currently, its forward yield stands at a healthy 5.98%.
Meanwhile, NorthWest Healthcare is expanding its presence in Australia, Europe, and Canada through both organic growth and acquisitions. These growth initiatives could increase its cash flows, thus allowing it to continue paying its dividend at a healthier yield.
TC Energy
My final pick is TC Energy (TSX: TRP)(NYSE: TRP), which earns around 95% of its adjusted EBITDA through rate-regulated assets or long-term contracts. So, its cash flows are primarily stable, thus allowing it to raise its dividends at a CAGR of 7% for the previous 21 years. Meanwhile, its forward yield currently stands at a healthy 5.30%.
Notably, TC Energy is progressing with its $29 billion capital program, which could grow its adjusted EBITDA at a CAGR of 5% through 2026. Also, the rising energy demand could increase the throughput of its liquidity pipeline segment, boosting its financials. Given its healthy growth prospects, its management expects to increase its dividend at an annualized rate of 3-5% in the medium term. So, TC Energy would be an excellent addition to your portfolio.
