Can you be richer than your boss? It’s improbable if the basis is position and salary scale within an organization. However, it can happen if you have other earnings outside of regular employment. Dividend stocks are common passive-income sources; you can amass riches from them over time.
Three dividend payers are ideal for long-term investors because of their enduring businesses and generous payouts. You can hold them in a Tax-Free Savings Account (TFSA) and Registered Retirement Savings Plan (RRSP) for tax-free money growth.
Stable, predictable dividends
Keyera (TSX: KEY) is an upstart compared to established Canadian pipeline operators, but it displays steady performance amid a volatile environment. At $30.90 per share, the energy stock outperforms the TSX year to date at +7.77% versus +4.61%. The current dividend yield is a mouth-watering 6.28%.
For illustration purposes, 2,062 shares ($62,715.80) will generate $1,000,34 in quarterly passive income. Keyera’s dividend policy aims to deliver stable and predictable dividends, subject to the discretion of the Board. The only change in the policy thus far in 2023 is the payout frequency from monthly to quarterly.
The $7.08 billion energy player derives revenues from three core segments: Liquids Infrastructure, Gathering & Processing, and Marketing. In the first quarter (Q1) of 2023, net earnings and distributable cash flow increased 21% and 27.4%, respectively, to $137.8 million and $227.4 million versus Q1 2022.
Keyera’s President and chief executive officer (CEO) Dean Setoguchi said, “Our proven business model has delivered reliable returns through all commodity cycles.” The Key Access Pipeline System (KAPS), its strategic asset, is now in service and should be the next growth catalyst.
Superior returns
Headwater Exploration (TSX: HWX) commits to delivering superior corporate-level returns and growing the quarterly dividend. The $1.62 billion exploration and development company lives up to its commitment, as evidenced by its 20.32% year-to-date return. At $6.90 per share, the corresponding dividend yield is 5.84%.
Investors’ confidence in the energy stock remains high despite the lower net income in Q1 2023 ($29.97 million) compared to Q1 2022 ($42.36 million). Headwater’s strategy is to explore and exploit while building a sustainable business of combined growth and free cash flow (FCF). For 2023, it forecasts 40% production growth and $80 million in FCF.
People business
Dexterra Group (TSX: DXT) is a lucrative investment prospect in the industrial sector. The $376.44 million company is an expert in facilities management and operations and provides turnkey workforce accommodations, energy services, forestry, and modular solutions. It’s also active in the food service industry.
The business thrives as shown by the consistent revenue growth from 2019 to 2022. Its president and CEO John Mac Cuish described the diversified support services organization as a people business due to its presence in nearly all vital sectors. However, in Q1 2023, the net loss reached $2.87 million compared to the $4.17 million net income from a year ago.
Nonetheless, management continues to address inflationary, supply chain, and labour availability issues across all business segments. The overall profitability should also improve this year due to lower non-recurring charges. If you invest today, the share price is $5.77 (+7.87% year to date), while the dividend yield is 6.25%.
Total earnings
Total earnings are not limited to salary from employment. You can make more money than your boss if you have recurring passive income or have built wealth from dividend stocks.
