Canadians seeking out top dividend stocks right now should go straight to Dividend Aristocrats. Here in Canada, to be a Dividend Aristocrat you need to find a company that has increased its dividend each year for at least five years.
While in the past, this may not have been quite as big an achievement, these days, it certainly is. Shares have dropped in the last year, but we’ve also gone through a pandemic and even more market uncertainty. So, while there hasn’t been a huge recession, as we had back during the Great Recession, it’s been quite a difficult number of years.
With that in mind, today, we’re looking at Dividend Aristocrats with 6% dividend yields or higher. These are companies that managed to increase yields even during these trying times and have super-high yields.
Allied Properties
First up is Allied Properties REIT (TSX: AP.UN). Allied REIT currently holds a dividend yield at 7.9% as of writing, with shares down 44% in the last year. Clearly, that dividend yield has climbed higher and higher, while shares have gone lower and lower.
However, it’s important to look at what Allied REIT invests in before jumping to conclusion. Allied REIT currently chooses urban office environments across Canadian major cities, with a focus on Toronto and Montreal. Most of its revenue comes from Central Canada, and it has a diverse set of tenants, including government and banking firms.
The main issue with Allied REIT is that it’s been performing under its own guidance. During its latest earnings results, operating income was up 14.5% year over year. However, funds from operations (FFO) came in below forecast, though net operating income (NOI) came in higher than estimates. Should this company start to rebound, it may be a great choice to have among dividend stocks.
BCE
Now for a more solid choice: BCE (TSX: BCE) has a dividend yield currently at 5.95% as of writing. It remains the largest of the telecommunications companies by market cap, holding 30% of the market as well. What’s more, that market share continues to rise, with 52% of its revenue coming from wireless as of 2022, and its 5G rollout bringing in even more clients.
Yet shares remain down by 4.5% in the last year, though they’ve climbed back by 8% year to date. Some of that growth came on the heels of its full-year earnings, where all guidance was achieved. That being said, net earnings were down 13.8%, though revenue climbed during the year.
Now, BCE stock is headed towards another earnings report this week, so investors should be looking for another potential bounce. This could therefore be a good time to pick up BCE stock before that dividend shrinks further.
First National Financial
Finally, if you aren’t in any hurry to collect returns but want passive income, consider First National Financial (TSX: FN). FN stock is a solid choice right now, as the main reason it’s down comes from outside pressure. Higher interest rates have certainly hurt the finance and mortgage provider. But it means you can bring in a dividend yield at 6.35%.
However, shares are actually up 5% in the last year, though they’ve been stable since the beginning of 2023. First National’s recent earnings came in with solid numbers, with an 7% increase in mortgages under administration (MUA). This allowed the company to achieve a record $133 billion MUA! Revenue was also up 23%, though net income shrunk from $53.6 million to $35.7 million.
It could be better, but it could be worse. That is why the company should have no problem recovering after interest rates return to normal levels. Certainly consider First National stock with your other dividend stocks today.
