3 Dividend Heavyweights That Are Paying Big Money

Blue-chip Dividend Aristocrats can be the core of your dividend portfolio, and any capital appreciation they offer will be a bonus.

| More on:
Canadian Dollars

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

When you are building your dividend portfolio, you have a lot of choices. You can choose the high-yield stocks that might not get full marks for sustainability. Then you have aristocrats with minimal yields that are better choices from a capital-appreciation perspective.

However, at any given time, there are a decent number of dividend heavyweights that offer you a good mix of everything — yields, sustainability potential, dividend growth, and even capital appreciation if you hold on to them long enough. Three such stocks should be on your radar right now.

The telecom giant

The Canadian telecom sector is heavily consolidated, and the most prominent player by market cap is also the most generous dividend payer. BCE (TSX:BCE)(NYSE:BCE) is currently offering a juicy yield of about 5.33%. And even though it’s a solid yield, it’s pretty low compared to what it was offering until early 2021.

Apart from being a leader in the telecom sector, it’s also a well-established Dividend Aristocrat. It has been growing its payouts for 13 years, and in the last decade, it has grown its payouts by about 65%. Annualized, that’s 6.5%, enough to outpace the inflation by a decent margin. It also offers a decent capital-appreciation potential.  

A financial holding company

Great-West Lifeco (TSX:GWO) is a financial holding company based in Canada but with businesses in three major markets: The U.S., Canada, and Europe, through four of its significant holdings. The number of assets under management (AUM) of over two trillion makes it comparable to some of the country’s largest financial institutions and giants.

From a growth perspective, Great West would have been an excellent investment in the century’s first decade. In the last 10 years, the stock has been a shaky grower, to say the least. However, its 5.8% yield, sustained by the healthy 54.2%, is reason enough to consider this investment, especially at its current undervalued state.

The energy giant

Enbridge (TSX:ENB)(NYSE:ENB) is a blue-chip holding worth considering for various reasons, starting with its position in the North American energy industry.

As the largest pipeline company in the region, it transports a significant chunk of the natural gas consumed and oil processed and exported from the continent. It also has other underlying businesses like power production and natural gas utility (in which it’s a leader in Ontario).

The growth potential of the company has not been an asset since 2015. However, its dividends are always a reliable strength. It has grown its payouts for 26 consecutive years, that includes the Great Recession, the 2014-2015 fall, and the 2020 energy crisis. It’s also quite generous with its payouts and is currently offering a juicy 5.98% yield.

Foolish takeaway

The three dividend stocks in Canada are worth holding for various reasons. All three are aristocrats, and, given enough time; they can also offer you modest enough capital appreciation. So, you can safely divert a sizeable chunk of your retirement savings into the three countries for passive income and capital preservation and appreciation.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge.

More on Dividend Stocks

analyze data
Dividend Stocks

2 Safe Dividend Stocks That Could Help You Fight Inflation

A dependable stream of passive income is one way to help offset rising inflation rates. Here are two top dividend…

Read more »

edit Person using calculator next to charts and graphs
Dividend Stocks

Stay Invested in a Recession: Increase Positions in 2 Value Stocks

The suggestion of market analysts is to increase positions in two value stocks if you want to stay invested amid…

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Dividend Stocks

3 Dividend Stocks to Buy as Inflation Surges in Canada

If you're worried about how surging inflation may impact your portfolio, here are three of the best dividend stocks to…

Read more »

You Should Know This
Dividend Stocks

High Inflation: The Good and the Bad for Canadians

Consider tucking away some of your long-term savings in quality dividend stocks like Brookfield Infrastructure in this correction.

Read more »

STACKED COINS DEPICTING MONEY GROWTH
Dividend Stocks

TFSA Investors: Turn $1,000 Into $10,000 in 10 Years

10-fold growth within a decade is rare but not unheard of. You can capture this growth either by predicting a…

Read more »

edit Real Estate Investment Trust REIT on double exsposure business background.
Dividend Stocks

1 Oversold REIT Stock to Buy for Safe Dividends

If you're looking for stable dividend income from an oversold stock, this office REIT is a perfect option.

Read more »

edit Real Estate Investment Trust REIT on double exsposure business background.
Dividend Stocks

3 Cheap Canadian REITs to Buy in 2022

Are you looking for passive income? Start treasure digging in cheap Canadian REITs in this market correction!

Read more »

Dividend Stocks

TFSA Passive Income: 3 Undervalued, High-Yield TSX Dividend Stocks to Buy Now

These top TSX dividend stocks with high yields now look attractive to buy for TFSA passive income.

Read more »