2 Ultra-Stable Canadian Stocks Just Crowned as Dividend Aristocrats for 2023

Waste Connections (TSX:WCN) stock and another Dividend Aristocrat could help investors crush the markets in 2023.

| More on:
Golden crown on a red velvet background

Image source: Getty Images

The Canadian Dividend Aristocrats are magnificent buys over the long haul. Their dividends are as growthy as they are dependable. Though they don’t always have market-beating performance, many of them do stand out as names that can produce a portfolio that’s better than the TSX Index.

Undoubtedly, the TSX is a top choice for many Canadian passive investors. However, its weighting to certain industries isn’t ideal in all scenarios. Last year, the TSX outshined the U.S. averages, especially the Nasdaq 100, which felt the full force of the growth-driven market selloff. And that’s thanks to its big weighting in the energy sector.

Nobody knows if oil prices will continue to hold their own as that earnings recession rolls in. Regardless, I remain a big fan of the TSX’s top dogs. In this piece, we’ll have a look at two ultra-stable TSX stocks that were recently inducted into the S&P/TSX Canadian Dividend Aristocrats Index.

Consider shares of agricultural commodities firm Nutrien (TSX:NTR) and long-time defensive growth play and trash collector Waste Connections (TSX:WCN).


Nutrien really outpaced the broader TSX last year, thanks in part to the surge in fertilizer prices. The stock was way too hot at the start of the Ukraine-Russia crisis. Though shares have since pulled back, now down around 24% from 2022 peak levels of over $141 per share, I still think the stock can find its legs in 2023, even if demand for commodities slips due to a coming recession.

First, the stock is cheap at 5.71 times trailing price to earnings (P/E) and 1.58 times price to book (P/B). The 2.36% dividend yield is still bountiful, albeit lower than historical levels. Even if commodities continue to sink, I view Nutrien as a great long-term pick and a dividend-growth gem that’s well deserving of its new spot in the Canadian Dividend Aristocrats Index.

The days of sky-high fertilizer prices may be coming to an end, but Nutrien is still a cash cow. Further, expect longer-term secular trends, such as the rising global population and its impact on fertilizer demand to be boons for Nutrien’s long-term dividend-growth prospects.

Waste Connections

Waste Connections is one of my favourite smart-beta companies on the TSX. It’s about time that the firm was added to the Dividend Aristocrats Index. Over the past five years, WCN stock has been a very smooth ride upward. The stock has doubled over the past five years, while experiencing less chop than the market averages. With a 0.69 beta, the lower magnitude of volatility is expected to continue, all while Waste Connections continues turning trash into cash.

Undoubtedly, Waste Connections is a wonderful defensive growth stock that can help keep portfolios steady during recession years. With a merger and acquisition strategy that’s paid off and one of the widest moats in Canada, I expect the North American waste collector to keep delivering for long-term investors.

The stock recently fell into a correction, opening up an intriguing entry point for investors who’ve yet to put their latest TFSA contribution to work. The dividend yield of 0.8% may be small, but it’s capable of impressive growth over the next 10 years.

The newest Dividend Aristocrats are great buys

Both WCN and NTR are terrific buys in my books. Between the two names, I prefer WCN stock. It’s more predictable, with a track record of market-crushing results that will likely continue over the foreseeable future.

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 Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Nutrien. The Motley Fool has a disclosure policy.

More on Dividend Stocks

money cash dividends
Dividend Stocks

Sitting on $10K? Invest in This TSX Stock for a Chance at $160K in 10 Years

Stocks are down, but don't count them out. TFSA investors should continue to invest in strong companies that should recover…

Read more »

analyze data
Dividend Stocks

How Much Do You Need to Invest to Give Up Work and Live Only Off Dividend Income?

Here's an honest assessment of how difficult it is to achieve "quit-your-job" levels of passive income.

Read more »

Profit dial turned up to maximum
Dividend Stocks

2 TSX Dividend Stocks With Seriously Huge Payouts

The TSX telecom sector has some great high-yielding companies up for grabs.

Read more »

TFSA and coins
Dividend Stocks

Dividend Stocks With Yields TFSA Investors Should Lock In Now!

Are you looking to build a passive-income stream? Here are two top dividend stocks to load up on in your…

Read more »

A plant grows from coins.
Dividend Stocks

2 Young TSX Stocks You’ll Be Glad You Bought in 10 Years

Youth means nothing when you plan to hold strong companies long term. These two TSX stocks should therefore be first…

Read more »

Man with no money. Businessman holding empty wallet
Dividend Stocks

Is it a Trap? 3 TSX Stocks With Ultra-High Dividend Yields 

Who doesn’t love dividends? But the high-interest rate environment makes ultra-high dividends unsustainable. Are these stocks a value trap?

Read more »

Value for money
Dividend Stocks

3 Value Stocks for Superior Returns in 2023

Given their solid underlying businesses, stable cash flows, high dividend yields, and attractive valuations, these three undervalued TSX stocks could…

Read more »

Financial technology concept.
Dividend Stocks

2 TSX Value Stocks to Buy for Peace of Mind (and a Crazy-Good Deal)

2 TSX stocks that could outperform in the long term.

Read more »