Finding high-quality and safe dividend stocks to buy and hold for years is an attractive proposition due to all the passive income they can generate.
In addition, you can find many dividend stocks with robust business operations that allow them to weather the storm when the economy is facing significant headwinds, as it is now.
But not every dividend stock is reliable. And there’s nothing worse than buying a stock only to have it cut the dividend soon after. Not only does the passive income you were expecting decline significantly, but often so does the stock price.
This makes it crucial to ensure that the dividend stocks you buy are safe and reliable. And while there’s never any substitution for doing your due diligence and ensuring the stock is high quality, another way to gain confidence in the stocks you want to buy is to see what kind of track record they have with respect to earning regular income and paying a consistent dividend.
That’s why some of the very best stocks to buy now, particularly in this environment, can be found on the Canadian Dividend Aristocrats list.
What are Canadian Dividend Aristocrats?
The Canadian Dividend Aristocrats list is made up of stocks on the TSX and included in the S&P Canada BMI (Broader market Index) that have a market cap of at least $300 million and have increased their dividends for at least five consecutive years. So, naturally, it’s a list filled with some of the best, most consistent, and highly reliable dividend stocks.
Furthermore, while the Canadian Dividend Aristocrats list has always been a great way to find safe dividend stocks to buy, these days, you can be sure that the stocks on the list are flexible and have robust business operations.
The pandemic came out of nowhere and significantly affected tonnes of stocks across many different industries. Now, more than two years after the pandemic’s start, any stock still on the list, particularly those with ultra-long track records, have proven that they are some of the best and safest dividend stocks to buy and hold for the long haul.
For example, a stock that has increased its dividend for multiple decades has had to continue operating well and earning tonnes of cash flow through various economic scenarios, including multiple recessions.
If you’re looking to put your cash to work today but want to ensure that the stocks you buy are of the highest quality, I would start by finding top stocks on the list, such as these two.
Two of the safest dividend stocks to buy now
Fortis is an ideal dividend stock to buy and hold for the long haul, especially if your priority is safety. The stock is the second-longest-standing Canadian Dividend Aristocrat with a dividend-growth streak of 48 years.
That’s a tonne of different market environments that Fortis has managed to continue growing its dividend through, thanks to its highly reliable operations. This should be no surprise, though. Fortis is an incredibly defensive utility stock with highly diversified operations.
While it offers a lower yield today of just 3.6%, it’s one of the best stocks you can buy to both protect your capital and grow your passive income. Furthermore, going forward, the stock plans to increase its dividend by 6% annually through at least 2024.
BCE is another one of the best dividend stocks to buy today that can grow your capital while also keeping it safe. The stock doesn’t have nearly as long of a dividend-growth streak, but at 13 straight years, it’s still a high-quality investment to make.
Furthermore, BCE has even more growth potential over the coming years, particularly as 5G technology continues to become more popular. Moreover, BCE’s dividend is a lot more attractive, as it currently offers a yield of roughly 5.8%.
If you’re looking for safe dividend stocks to buy in this environment, both Fortis and BCE, but also many other Canadian Dividend Aristocrats, are easily some of the best to consider today.