For many, retiring early is only a dream. However, itâs more achievable than you think it is. All it requires is smart and consistent investing over a long enough period. For example, investors should identify excellent dividend companies and continue to add to those positions. Over time, the dividends received from those stocks could allow you to retire early. In this article, I’ll discuss three TSX dividend stocks that could help you retire early.
An elite dividend stock
Of all the companies listed on the TSX, fewer than 15 have managed to grow their dividend in each of the past 25 years. That means that the companies that have been able to do that are outstanding businesses compared to their peers. Canadian National Railway (TSX: CNR)(NYSE: CNI) is one of those companies. It holds a 25-year dividend-growth streak. That qualifies the company as a Dividend Aristocrat in Canada and the United States.
When looking at dividend stocks to hold in a portfolio, investors should care about two things. First is a companyâs ability to raise dividends each year, as I alluded to earlier. Second is how fast that companyâs dividend grows over time. Itâs imperative that you hold stocks that have a dividend-growth rate than can outpace the rate of inflation. That way, you ensure that you maintain buying power over time. With Canadian National, you get that. Over the past five years, it has grown its dividend at a CAGR of 12.2%.
A company that more people should take note of
When talking about dividend stocks, investors usually gravitate towards the banks and utility companies. That isnât without good reason. Those businesses are very reliable, as they see recurring payments from their customers. However, that results in other excellent businesses not getting the same kind of attention. For example, many investors probably havenât considered investing in Alimentation Couche-Tard (TSX: ATD). Yet I believe itâs one of the most interesting stocks on the TSX.
Many people donât realize how big this company is. Alimentation Couche-Tard operates more than 14,000 convenience stores across 14 countries. It also operates under many different banners. This includes its flagship Alimentation Couche-Tard and Macâs locations. However, it also includes On the Run, Circle K, and many more. Over the past five years, Alimentation Couche-Tard has grown its dividend at a CAGR of 19.6%.
An amazing dividend-growth rate
If youâre looking for a stock with an excellent dividend-growth rate, then goeasy (TSX: GSY) is one you should consider today. If youâre unfamiliar with this company, know that it operates two distinct business segments. First, is easyfinancial, which provides high-interest loans to subprime borrowers. Second, it operates easyhome, which sells furniture and other home goods on a rent-to-own basis.
goeasyâs dividend growth rate may be the most impressive Iâve ever seen. Over the past five years, it has grown its dividend at a CAGR of 38.3%. That greatly outpaces the rate of inflation, even in a year like this one.
