Passive-Income Alert: 2 Top Canadian Dividend Stocks With 6% Yields

Top TSX dividend stocks are now on sale and offer high yields for investors seeking passive income.

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The market correction is giving investors a chance to buy top TSX dividend stocks at discounted prices for self-directed Tax-Free Savings Account (TFSA) portfolios focused on passive income. Falling share prices are tough to watch, but they drive up the dividend yields retirees and other income investors can get on great Canadian stocks.

Bank of Nova Scotia

Bank of Nova Scotia (TSX:BNS) is Canada’s fourth-largest bank with a current market capitalization near $79 billion. The stock went into a steep slide through the back half of last year amid a broader pullback in the bank sector and has remained under pressure. Bank of Nova Scotia trades near $66.50 per share at the time of writing compared to a 12-month low around $63 and the 12-month high above $83.

Contrarian investors might want to start nibbling on BNS stock while it is out of favour. Bank of Nova Scotia brought in a new chief executive officer (CEO) this year who is conducting a strategic review of the business and is expected to announce overhaul plans later in the year or in early 2024.

One area of focus will be the international group that has large operations in the Pacific Alliance trade bloc markets of Mexico, Peru, Chile, and Colombia. Investors have not seen the anticipated returns materialize from the big bets on Latin America. The four countries offer attractive long-term growth potential, but political and economic volatility are constant threats.

In an address to shareholders, the new CEO hinted that Mexico would likely remain an important market for Bank of Nova Scotia. If assets in the other three countries are monetized it will be interesting to see if the focus will shift to the United States or other markets.

Bank of Nova Scotia remains very profitable and has a solid capital position to ride out near-term market turbulence. The dividend should be safe and now offers a 6.2% yield, so you get paid well to wait for a rebound.


BCE (TSX:BCE) traded for $73 in April at the peak last year before sliding to $57 in October. The stock has since recovered some ground and is back up to $63 at the time of writing.

Income investors have owned BCE for decades, and there is little reason for that to change. The overall revenue stream remains recession-resistant, although the media group is more susceptible to a weakening economy as advertisers tend to trim marketing budgets when they need to preserve cash flow.

The giant wireline and wireless network operations, however, still generate the bulk of sales. Businesses and households need to maintain their internet and mobile subscriptions regardless of the situation in the economy. As a result, BCE should be a good stock to own if you are worried that a meaningful economic downturn is on the way.

BCE invests heavily in network upgrades to protect its market position and drive future revenue growth. In fact, the company spent roughly $5 billion in 2022 on projects that include the expansion of the 5G network and BCE’s fibre-to-the-premises wireline initiative.

Earnings are expected to dip in 2023 as a result of higher expenses, but total revenue and free cash flow are projected to be above 2022 levels. This should support another decent dividend increase in 2024. BCE typically raises the payout by about 5% per year. At the time of writing, the stock provides a 6.1% dividend yield.

The bottom line on top stocks for high dividend yields

Bank of Nova Scotia and BCE pay attractive dividends that should continue to grow. If you have some cash to put to work in a portfolio focused on passive income, these stocks look cheap today and deserve to be on your radar.

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.

The Motley Fool recommends Bank Of Nova Scotia. The Motley Fool has a disclosure policy. Fool contributor Andrew Walker owns shares of BCE.

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