Passive Income: 2 Cheap TSX Dividend Stocks to Buy in April 2023

Looking to build a dependable stream of passive income? Here are two dividend stocks trading at discounted prices.

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If you’ve been thinking of creating an additional income stream, now may be the time. The TSX is full of high-quality dividend stocks that can provide investors with a steady stream of income. From high yields to long payout streaks, there’s no shortage of dividend-paying companies for Canadians to choose from. Not to mention, there are lots of bargains to take advantage of today, too.

In addition to income, dividend stocks also have the potential to add stability to an investment portfolio. As opposed to high-volatility growth stocks, blue-chip Dividend Aristocrats tend to be much more predictable in terms of volatility. Growth returns may not be able to keep up with the hottest tech stocks, but you’ll be glad to own a dependable Dividend Aristocrat during uncertain market periods. 

With more volatility likely on the horizon, at least in the short term, I’m looking to load up on a couple of dividend stocks in my own portfolio. I’ve got these two companies at the top of my watch list right now.

Dividend stock #1: Sun Life

From a growth investor’s perspective, I’ll admit, there’s not a whole lot to get excited about with this insurance company. But for passive-income investors, this seemingly boring stock is the type of company you can feel good about buying and holding for decades. 

At a nearly $40 billion market cap, Sun Life (TSX:SLF) has built itself into a global financial services leader, providing financial planning, insurance, and wealth management services. Sun Life has already established a strong international presence, but the company isn’t anywhere near done growing. Management has its sights set on continuing to expand aggressively throughout Asia in the coming years. 

For what is typically a low-volatility stock, Sun Life has taken a significant hit as of late. The recent U.S. banking crisis led to a selloff in the Canadian banking sector too, impacting Sun Life. Shares have dropped close to 10% over the past two months, presenting Canadian investors with a great opportunity to start a position at a discount.

At today’s stock price, Sun Life’s dividend is yielding just over 4.5%, which isn’t the highest yield you can find on the TSX right now. But when you factor in the long-term stability that the company can provide, this is a top dividend stock for investors looking to build a dependable stream of passive income. 

Dividend stock #2: Northland Power

Growth investors seeking passive income should have this beaten-down renewable energy stock on their radar. 

At a 3.5% dividend yield, Northland Power (TSX:NPI) may not seem like the most attractive dividend stock on the TSX. But when you factor in its market-beating growth potential, there aren’t many dividend-paying companies around like this one.

Not even including dividends, shares of Northland Power are up 50% over the past five years. That’s good enough for close to doubling the returns of the S&P/TSX Composite Index

And with demand for renewable energy only expected to continue to rise, I’d bank on many more years of market-beating returns for this top green energy company.

Northland Power is currently trading 30% below all-time highs. If you’ve been thinking of increasing your exposure to the renewable energy sector, now is the time to be investing.

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

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