4 Top Stocks With High Dividend Growth to Buy in 2023 and Hold Forever

Given their solid dividend growth and healthy growth prospects, I believe these four stocks would be an excellent buy right now.

| More on:
Family relationship with bond and care

Image source: Getty Images

Investing in dividend stocks is one of the convenient ways to earn passive income. Though investors should be careful when choosing stocks, as dividends are not guaranteed. The following four Canadian stocks have raised their dividends at a healthier rate, reflecting their solid financials. So, investors can buy these stocks to boost their passive income.

Canadian Natural Resources

Canadian Natural Resources (TSX:CNQ), which is involved in oil and natural gas production,  would be my first pick. The company generates stable cash flows, supported by its long-life low-decline assets and high-value reserves with lower maintenance expenses. These solid cash flows have allowed it to reward its shareholders by consistently raising its dividends. Over the previous 23 years, the company has increased its dividends at an impressive CAGR (compounded annual growth rate) of 21%, with its yield currently at 4.38%.

Amid supply disruptions and growing demand due to the reopening of the Chinese economy, oil prices have increased and could remain elevated in the near-to-medium term. Higher oil prices could benefit oil-producing companies, such as CNQ. Besides, the company expects to invest around $5.2 billion this year, strengthening its asset base. Also, the management expects its oil and natural gas production to increase this year, with the midpoint of management’s guidance representing 4.5% growth from 2022 levels. Higher prices and increased production could drive CNQ’s financials in the coming quarters, thus allowing it to continue its dividend growth.


My second pick would be Enbridge (TSX:ENB), which operates a pipeline network to transport oil and natural gas across North America. With around 98% of adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) underpinned by long-term contracts and 80% protected against inflation, the company’s cash flows are stable and predictable. Supported by solid cash flows, the company has raised its dividends at a CAGR of over 10% for the last 28 years. ENB’s dividends look safe, with its payout ratio currently at 65%. Better still, it offers an impressive forward dividend yield of 6.62%.

Meanwhile, amid growing energy demand and ongoing geopolitical tensions, oil and LNG (liquified natural gas) exports from North America have increased, driving Enbridge’s asset utilization rate. Additionally, the company is progressing with growth and expansion projects worth $18 billion, which could boost its financials in the coming years. So, I believe Enbridge is well-positioned to continue with its dividend growth.


goeasy (TSX:GSY) is another worthy dividend stock to have in your portfolio. GSY has been raising its dividends at an impressive CAGR of 33.8% for the last seven years. Its dividend yield currently stands at a healthy 4%. Meanwhile, last month, the federal government announced that it hopes to reduce the maximum allowable annual percentage rate on loans to 35% from 47%. The announcement and weakness in the banking sector have dragged the company’s stock price down, with the company trading 34% lower than its 52-week high.

Meanwhile, the steep correction has created an excellent buying opportunity, as goeasy remains hopeful of maintaining its growth. According to the management, only 36% of its loans carry interest rates above the proposed allowable rate. Besides, its expanding loan portfolio and falling net charge-off rate could continue to drive its financials. So, given its high dividend growth and an attractive NTM (next 12 months) price-to-earnings multiple of 6.8, goeasy would be an excellent buy.

TC Energy

TC Energy (TSX:TRP), a midstream energy company with an average annual shareholders’ return of 11% since 2000, would be my final pick. Supported by its strong financials, the company has increased its dividends at an annualized rate of 7% for the previous 23 years. TRP also offers an impressive dividend yield of 6.62%.

The company is continuing with its $34 billion secured capital program, which could grow its adjusted EBITDA at a CAGR of 6% through 2026. So, supoorted by these growth initiatives, management expects to raise its dividends by 3–5% annually in the coming years. So, given its high dividend yield and dividend growth guidance, TC Energy would be an excellent buy to boost your passive income.

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 Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool recommends Canadian Natural Resources and Enbridge. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Dividend Stocks

Meta Is Now a Dividend Stock, but This TSX Stock Is a Better Buy

TSX dividend stock Brookfield Asset Management (TSX:BAM) has a higher yield than Meta Platforms (NASDAQ:META).

Read more »

Happy Retirement” on a road
Dividend Stocks

3 TSX Stocks That Can Turn Retirement Dreams Into Reality

Looking for income that lasts right through retirement? These three TSX stocks are the best to make your retirement dreams…

Read more »

Growing plant shoots on coins
Dividend Stocks

Better Buy in August: Passive-Income or Growth Stocks?

With a steady mix of passive-income and growth stocks, investors can create a prime portfolio even during market volatility.

Read more »

a person prepares to fight by taping their knuckles
Dividend Stocks

3 Defensive TSX Stocks for Lower-Risk Investors

These three TSX stocks are all high-quality companies with defensive businesses, making them ideal for low-risk investors.

Read more »

ETF chart stocks
Dividend Stocks

2 Canadian ETFs to Buy and Hold Forever in Your TFSA

ETFs like iShares Canadian Quality Dividend ETF (TSX:DIV) have delivered admirable total returns.

Read more »

TFSA and coins
Dividend Stocks

How to Use Your TFSA to Earn $5,000 Per Year in Tax-Free Income

Canadian stocks like Canadian National Railway (TSX:CNR) can pay substantial amounts of dividends.

Read more »

money cash dividends
Dividend Stocks

Beat the TSX With This Cash-Gushing Dividend Stock

Here are some key reasons why this top Canadian dividend stock could continue to outperform the TSX Composite benchmark in…

Read more »

financial freedom sign
Dividend Stocks

3 Stocks to Buy Now That Could Help You Retire a Millionaire

These three stocks are all reliable and have years of growth potential, making them some of the best stocks to…

Read more »