Brookfield Renewable Partners Is a High-Yielding Canadian Dividend Stock to Buy Now and Own Forever

There are more reasons than just a high dividend yield to have this Canadian energy stock on your watch list.

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Building a passive-income stream is something I’ve been thinking of far more today than I ever have. As I am much more of a growth investor, slow-growing Dividend Aristocrats were seldom found on my watch list. But with all of the volatility we’ve endured since 2020, having an extra source of income could go a long way.

With that in mind, I recently opened a position at Brookfield Renewable Partners (TSX:BEP.UN). I chose this energy company because, in addition to a top dividend yield, the TSX stock can also provide my portfolio with market-beating growth potential. 

In the short term, the passive income generated has been able to partially offset some of the volatility in my portfolio. In a portfolio over-indexed towards high-growth tech stocks, that is much needed. 

Over the long term, I firmly believe that Brookfield Renewable Partners will be able to continue its consistent market-beating returns.

If you’re looking to add a little extra income to your portfolio without sacrificing growth, this dividend stock should be on your watch list.

Brookfield Renewable Partners

Nearing a market cap of $25 billion, Brookfield Renewable Partners is a global leader in the renewable energy space. The company owns and operates clean energy facilities across the globe, generating electricity through hydroelectric, wind, solar, and many other sources.

As a leader in the space, this is the perfect company to own for instant diversification in the growing renewable energy sector. Shareholders gain exposure to both a range of different geographies and clean energy assets.

In addition to a top dividend yield, Brookfield Renewable Partners has been a consistent market beater in recent years. Excluding dividends, the energy stock’s 70% return over the past five years is good enough for more than doubling the returns of the S&P/TSX Composite Index. Over the past decade, shares are up well over 100%, once again easily outpacing the returns of the broader Canadian stock market.

At today’s stock price, Brookfield Renewable Partners’s annual dividend of $1.79 yields just shy of 5%. 

Good luck trying to find another dividend stock on the TSX yielding upwards of 4% that can match this energy stock’s track record of market-beating returns.

Taking advantage of discounted prices

Alongside many other TSX stocks, Brookfield Renewable Partners started off 2023 with a hot start. However, even after jumping more than 5% in January, shares are still trading far below all-time highs set in early 2021. The stock is currently down close to 15% over the past year and 40% below all-time highs.

Despite the recent selloff, though, the business itself remains in excellent shape. The renewable energy sector as a whole witnessed a massive boom following the COVID-19 market crash in 2020. And after such a rapid run-up, it’s only natural to see a cooling-off period.

For a company with as impressive of a growth track record, as Brookfield Renewable Partners, you won’t want to miss a sale like this. It’s only a matter of time before this market-leading energy stock is back to all-time highs. And in the meantime, there’s a juicy dividend to enjoy.

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 Nicholas Dobroruka has positions in Brookfield Renewable Partners. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

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