There’s no question that some of the best Canadian stocks you can buy and hold in your portfolio for decades are dividend-growth stocks.
Dividend-growth stocks, which constantly increase the passive income they provide to investors, are compelling to own for exactly that reason. When companies have years of consistent dividend increases, it shows what high-quality operations they have.
To be able to constantly pay back cash to investors and increase the amount you’re returning each year, these stocks have to be able to weather many different market conditions.
If you’re looking to find high-quality Canadian stocks that you can buy and hold for years, here are three that have each increased their dividends consistently for over a quarter-century.
One of the best long-term growth stocks in Canada
Sometimes dividend-growth stocks pay significant dividends. Other times, the yield may not be as attractive, but the long-term growth potential it offers can be much higher than the rest of the market.
That’s the case with Thomson Reuters (TSX:TRI)(NYSE:TRI), a company that provides workflow solutions all across the globe, including legal, tax and accounting services, as well as its highly popular news segment.
In just the last decade, Thomson Reuters has earned investors a total return of more than 500%, significantly outperforming the TSX, which has a total return of just 69% over the same period. In addition, the stock has also increased its dividend payments by roughly 40% over that stretch, and, in total, it’s increased its dividend for 28 straight years.
So, while it doesn’t pay out a tonne of cash, clearly, the capital it has retained, it’s putting to good use. Therefore, if you’re looking to buy high-quality Canadian dividend stocks that you can have confidence in no matter what the market does in the short term, Thomson Reuters is one of the best.
A top transportation stock
Another company, like Thomson Reuters, that pays less cash to investors but is constantly earning attractive long-term gains is Canadian National Railway (TSX:CNR)(NYSE:CNI). Canadian National Railway is one of the best long-term stocks you can own, as its operations are at the heart of the economy.
There’s a reason why even with all the technology we have today, trains continue to be one of the most popular forms of transportation; they’re efficient. Therefore, CNR is always a stock that you can have confidence in if you’re holding for the long haul.
And much like Thomson Reuters, its consistent dividend increases, which have gone on for 26 straight years, are a clear sign of what an excellent company CNR is.
Over the last decade, while its returns aren’t as impressive as TRI, CNR has still earned investors a total return of 290%. That’s still a compound annual growth rate of more than 14.5% — an impressive return for such a reliable and high-quality company.
Therefore, while its dividend only offers a yield of roughly 2.1% today, CNR has to be considered one of the best Canadian dividend stocks.
One of the best high-yield Canadian dividend stocks
The above two stocks are truly excellent companies. But if you’re looking for Canadian dividend stocks that provide significant passive income, you may want to consider Enbridge (TSX:ENB)(NYSE:ENB) and its roughly 6.4% dividend yield.
Enbridge is another massive large-cap stock and another highly defensive business at the heart of the economy. And because its pipelines and others assets earn so much revenue for the company yet require little maintenance, Enbridge is constantly bringing in tonnes of cash flow.
In fact, in 2022, Enbridge expects it will generate distributable cash flow per share of $5.20 to $5.50 a share. And with the annual dividend only being $3.44 per share, not only is it incredibly safe, but the company has a tonne of cash left over to invest in expanding its operations.
Therefore, not only does its stock offer an impressive dividend yield, but it’s also consistently increased its dividend for 26 years.
So, if you’re looking for high-quality Canadian dividend stocks to buy in this environment, Enbridge is certainly one of the best.
