Think Dividends and Growth Don’t Mix? 4 Stocks to Prove You Wrong

Stocks that offer a good mix of both dividends and growth potential can help with the development of a well-balanced portfolio.

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When you are investing in dividends or growth, you don’t exclusively have to invest in one or the other. Several stocks offer a healthy mix of both, and they can keep your portfolio fairly balanced. However, the same results can be achieved by investing proportionally in pure dividends and growth stocks. If you are seeking a good mix of both growth and dividends, at least four stocks should be on your radar.

A telecom company

Telus (TSX:T) is a Canadian telecom leader and among the promising 5G stocks in the country. Being part of a highly consolidated industry has its perks, and Telus is among the three giants that dominate several segments of the telecom industry, with millions of regular consumers/subscribers across different operational categories (wireless, broadband, etc.).

Telus is also diversifying out of the traditional telecom businesses, is growing its IT services business telehealth business, and has a significant presence in the home security/smart home market. This indicates that it’s well positioned to thrive in the Internet of Things market once it grows to a reasonable size.

As for its returns, it has grown over 300% in the last two decades, which indicates a decent long-term growth potential, and has earned the title of Dividend Aristocrat by growing its payouts for 19 consecutive years. It’s currently trading at an amazing discount and is offering a juicy 5.9% yield.

An infrastructure company

Brookfield Infrastructures (TSX:BIP.UN) represents the infrastructure businesses of one of Canada’s largest asset management firms. It owns infrastructure in four categories — i.e., utilities, transport, midstream, and data. More than half of these are concentrated in the Americas; the rest are in Europe and Asia Pacific.

Brookfield Infrastructure has offered exceptional returns to its investors in the last decade — over 390% — and they are almost equally divided between its growth and dividends. It’s offering a healthy 4.1% yield right now, strengthening its position as a dividend investment for passive income.

A bank stock

Even though it’s the smallest bank by market cap among the Big Six, National Bank of Canada (TSX:NA) is one of the best growers in the Canadian banking sector. It’s mostly a regional bank, with the bulk of its revenues coming from Quebec. But the bank is expanding its international reach, which may lead to stronger organic growth in the future.

It has always offered a healthy combination of dividends and growth. It has risen by almost 160% in the last decade alone, and if you add the dividends to the overall returns over the period, the number gets quite close to 300%. The stock is bullish compared to the rest of the bank stocks, most of which are trading at a double-digit discount, but the yield is still at a healthy level (4%).


Real estate investment trusts (REITs) are typically cherished for their dividends, but Granite REIT (TSX:GRT.UN), which ironically, is one of the handful of Aristocrats among the REITs and has been growing its payouts for consecutive years, is also a strong pick for its growth potential.

It’s also a relatively safe yield, thanks to its international industrial portfolio, a significant segment representing logistics and supply chain properties, primed to thrive in the current e-commerce economy.

The stock rose by about 120% in the last 10 years. If you consider both capital growth and dividends, the overall returns become over 260%, shifting the scales in favour of the dividends. The current 4% yield is also quite attractive.

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Foolish takeaway

The four stocks offer a healthy combination of dividends and capital-appreciation potential. They are also among the leaders or strongest players within their industries, making them stable long-term picks that you can hold for decades.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Brookfield Infrastructure Partners, Granite Real Estate Investment Trust, and TELUS. The Motley Fool has a disclosure policy.

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