3 Stocks to Quickly Inject Your Portfolio With Passive Income

Pembina Pipeline (TSX:PPL) stock could add considerable passive income to your portfolio.

| More on:
money cash dividends

Image source: Getty Images

Are you looking to add some passive income to your portfolio in 2022?

If so, now would be a good time to do it. Value stocks — including dividend stocks — are rising this year thanks to interest rate hikes that are making tech stocks less appealing. As a result, value stocks’ dividend yields are coming down. There are plenty of Canadian energy stocks, for example, that yielded over 7% last year that don’t even yield 6% today. The high yields are quickly dwindling.

In this article, I will explore three TSX stocks that could still add some much-needed passive income to your portfolio in 2022.

Pembina Pipeline

Pembina Pipeline (TSX:PPL)(NYSE:PBA) is a Canadian pipeline that serves key markets in Canada and the United States. It has 3.1 million barrels per day of pipeline capacity and operates natural gas storage facilities serving clients at rail terminals. It also has a smaller crude oil and natural gas marketing service.

Pembina Pipeline’s current dividend yield is 5%. This is much higher than the TSX average, which is about 2.48%. PPL’s payout ratio based on trailing 12-month earnings is above 100%. However, estimates of this year’s earnings put it at 89%, which is fairly sustainable and is not abnormal for a pipeline company.

Speaking of earnings: PPL’s most recent quarter was pretty strong, with $80 million in net income (up from a $1.29 billion loss) and $2.56 billion in revenue (up 52%). If PPL can keep up its recent growth, then its dividend will appear quite sustainable in the future.

CIBC

Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) is a Canadian bank stock that yields about 4%. It is one of Canada’s Big Six banks, and the one whose business activities are most concentrated in Canada. Only about 12% of CM’s earnings come from foreign markets (chiefly the U.S.); for other Canadian banks, the figure is as high as 33%.

This focus on Canada gives CM less growth potential than some of its peers, as the Canadian financial services industry is fairly saturated. On the plus side, Canadian banks are generally regarded as being safe, and there is always some potential for growth stemming from higher interest rates, which are beginning to materialize this year.

Enbridge

Enbridge (TSX:ENB)(NYSE:ENB) is another Canadian pipeline stock like PPL. It sports a 6% dividend yield at a 9% five-year CAGR dividend-growth rate. This is one high-yield stock that not only pays but raises its dividend.

The energy industry is in a very good place in 2022, with oil prices rising as supply falls. OPEC is rumoured to be out of spare capacity, and oil isn’t flowing freely in Eastern Europe due to the conflict in the region. North American energy companies only benefit from this phenomenon, as the supply rout sends market prices higher.

Enbridge doesn’t directly sell oil, but it does transport it and enjoys more demand for its services when prices are high. It also has a natural gas utility business and is steadily raising natural gas rates. So, this is one dividend stock that could really run in the year ahead.

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 Andrew Button has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge and PEMBINA PIPELINE CORPORATION.

More on Investing

Arrowings ascending on a chalkboard
Investing

5 Canadian Stocks That Have Gained Value Year to Date

Although many Canadian stocks have sold off this year, and by a significant amount, here are five that have actually…

Read more »

Filling up at the gas pumps.
Energy Stocks

Gas Prices Are Hitting Record Highs: 2 Stocks to Buy Now!

Buy Suncor Energy stock, Canada's integrated oil and gas giant that's benefitting immensely, as gasoline prices continue to soar.

Read more »

Senior Couple Walking With Pet Bulldog In Countryside
Bank Stocks

A Different Bank for a Comfortable Retirement

Want a comfortable retirement? Investing in this different bank today can help you reach that goal through a solid income…

Read more »

Money growing in soil , Business success concept.
Dividend Stocks

Top Canadian Dividend Stocks to Buy and Hold for the Long Term

These Canadian companies have been paying dividends for more than four decades and have been consistently growing the same.

Read more »

thinking
Bank Stocks

Bank of Montreal (TSX:BMO) Raises Dividend: Is the Stock a Buy?

Bank of Montreal is about to get a lot bigger. Should you buy the stock?

Read more »

man window buildings
Investing

Where Do Economists Expect Canadian Housing Prices to Fall Most?

Canadian housing prices may be falling -- in some regions, more than others -- but there are still plenty of…

Read more »

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

3 Hydrogen Stocks Set to Become Major Multi-Baggers

These three hydrogen stocks could certainly achieve multi-bagger status in the years to come after they overcome the present-day hurdles.

Read more »

Technology
Stocks for Beginners

Starting an Investment Portfolio? Buy These 3 Stocks!

Interested in getting a start in the stock market? Buy these three stocks today!

Read more »