The quant team over at Scotiabank (TSX:BNS) recently revealed its list of Dividend Champions. And while there were a lot of great stocks on the list, with many trading at reasonable valuations, I think three really stood out as being worthy of my November watchlist. In this piece, we’ll just have a closer look at a trio of names that I believe are the best of the Dividend Champions.
Of course, just because shares of the champs are priced modestly doesn’t mean they are immune from a surge in volatility. We’ve been slammed with high levels of volatility over the past few months. And while investors should hope for the best, they should certainly not expect any sort of swift reversal. While a near-term pop is certainly possible, investors chasing sharp moves off lows are most likely to be left disappointed.
The following three dividend champs make for terrific plays to own, not just for the next few weeks but for the next few years, even decades. Without further ado, consider Canadian energy kingpin Canadian Natural Resources (TSX:CNQ), ailing telecom firm Telus (TSX:T), and intriguing pipeline play TC Energy (TSX:TRP).
Canadian Natural Resources
Canadian Natural Resources isn’t just a Dividend Champion; it’s one of the best energy firms in the Canadian oil patch. Undoubtedly, shares have been incredibly resilient over the past two years, rising around 68% while the rest of the market fluctuated wildly, with the TSX Index actually sagging just over 11% over the timespan.
Even with the solid multi-year rally behind it, I still view the energy juggernaut as a great value. Shares of the $96.2 billion firm go for just 12.9 times trailing price to earnings (P/E). With a nice 4.1% dividend yield and all-time highs (less than 4% away) within reach, CNQ is a standout dividend champion that long-term thinkers should have atop their radars.
Telus
Telus is a telecom firm that’s down and out after enduring a nearly 35% fall from its peak. Indeed, the telecom firm, which has a reputation for outstanding customer service, used to be seen as a relatively safe dividend darling. Though the dividend is secure, albeit swollen, with a 6.61% dividend yield, the stock is likely to remain an incredibly choppy ride, as Canada tests recession territory, possibly in 2024.
Either way, I view Telus as a great buy on the dip if you’ve got the patience. It’s a Dividend Champion that could keep hiking its payout, spoiling investors, even amid trying times.
TC Energy
Last but certainly not least, we have TC Energy, a pipeline firm that made multi-year lows just a few weeks ago. Indeed, the midstream energy space is quite stormy these days. Moving ahead, TC Energy could be in a spot to sell a chunk of its assets.
Reportedly, its minority stake in the ANR pipeline could fetch a great deal. Either way, the 7.92% dividend yield looks safe and perhaps poised to return to the high-growth track on the other side of a potential recession. There’s a lot going on behind the scenes at TC, but I think the firm will prosper again. Investors just need to have patience as the overhaul continues.
