The TSX today continues to drop, with the index down 10.4% year to date as of writing. From heights this year, the picture is even more bleak, with the TSX down 14%. But when it comes to some TSX stocks I own specifically, I’m hoping it drops even further.
Let me be clear; there’s a method to the madness, and it’s one supported by the Motley Fool. In my case, I’m a long-term investor. I understand it can be really hard right now looking at your losses and not selling everything to hoard what you can. But the long term is far better.
That’s especially true when you’re looking at dividend-paying TSX stocks that are Dividend Aristocrats. These companies have paid a dividend year after year with long histories of dividend increases. And that’s why I’m looking at these three in my portfolio on the TSX today. And why I believe Motley Fool investors should do the same. Should these three continue to drop, I’ll be picking up more and more to bring in solid passive income at a far higher yield.
CP stock
First up, I’m hoping Canadian Pacific Railway (TSX: CP)(NYSE: CP) drops further. CP stock is one of the dividend stocks that’s managed to stay in the positive, up 3% year to date. However, it did go through a drop by March, falling 10% from then to present day.
And I hope it falls even further. First off, I’d still be in the black as I bought this dividend stock years ago. But more than that, CP stock is due for enormous growth. That’s thanks to the expansion of its railway by the purchase of Kansas City Southern. This purchase now makes it the only railway that can run throughout North America.
Analysts believe the dividend stock is one of the TSX stocks with massive growth opportunities because of this purchase. Given this, even right now it remains a steal. But long term, we could see growth similar to the last decade. Shares grew 593% in that time — a compound annual growth rate (CAGR) of 21%!
Meanwhile, CP stock offers a 0.81% dividend yield. Yes, it is not high, and it was recently cut, but when the debt from the KCS purchase is through, I’m certain it will come back up.
CIBC stock
Among TSX stocks, I love the Big Six banks, but especially Canadian Imperial Bank of Commerce (TSX: CM)(NYSE: CM). I own a few, but this one provides me with the highest dividend yield of the banks. And right now, banks aren’t faring too well thanks to rising interest rates leading to lower loans.
But CIBC stock is a Canadian bank, and that means it has provisions for loan losses. So, the bank is certain to come roaring back to pre-fall prices within a year, just as it has the last several economic downturns. And that means I can therefore pick up this dividend stock for a steal and lock in incredible passive income.
Shares of CIBC stock are down 13% year to date, offering a 5.23% dividend yield as of writing. Yet in the last decade, shares are still up 185% for a CAGR of 11%! That’s including this recent fall. So, this is one I hope continues to drop so I can pick up more passive income, as it continues to grow for decades.
NorthWest Healthcare
One of my favourite TSX stocks I own is NorthWest Healthcare Properties REIT (TSX:NWH.UN). This investment has proven to be worth its weight in gold. The company owns healthcare properties around the world, now including the United States. And that includes everything from hospitals to parking garages — all with long lease agreements.
So, this dividend stock is a strong one for Motley Fool investors wanting long-term income. It provides stable passive income through its lease agreements and occupancy. And it’s growing all the time through acquisitions and property purchases. It proved its worth through the pandemic and is now proving itself again as a defensive stock I’ll never sell.
But I will buy more should it continue dropping. Shares are down 7.8% year to date, but, again, it’s up 65% in the last five years for a CAGR of 10.44%. So, I can lock in a whopping 6.44% dividend yield right now if I wish.
