Beyond the Big Banks: Lesser-Known Canadian Stocks Offering Attractive Yields

While big banks are a popular choice for many Canadian investors, these two stocks both trade cheaply and offer investors attractive yields.

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When it comes to building a passive income stream with your stock portfolio, there’s no doubt that some of the most popular investments are the big banks, especially when they offer Canadian investors attractive yields as they do today.

The big banks are well known for their impressive stability, consistently long-term growth potential, and constantly increasing dividends. There’s no question that these are certainly some of the top stocks to consider adding to a well-diversified portfolio.

However, often some of the cheapest stocks that offer some of the most attractive yet still sustainable yields are in lesser-known companies.

Because these stocks aren’t as well known, they usually trade with less of a premium, allowing investors to buy them undervalued and lock in an even higher yield.

So if you’ve been looking to boost your passive income lately, let’s look beyond the big banks and consider these two lesser-known stocks that offer unbelievably attractive yields.

A top defensive growth stock with an exceptional yield

Brookfield Infrastructure Partners

Brookfield Infrastructure Partners (TSX:BIP.UN) is not necessarily an unpopular stock. In comparison to the big banks, though, it’s certainly a lesser-known stock. Nevertheless, it’s one of the best investments you can buy and hold for years. Plus, it pays an attractive and consistently growing dividend yield.

What’s most impressive about Brookfield is that it owns a massive portfolio of several different essential infrastructure assets, yet it’s also diversified geographically as well with operations located all over the globe. Therefore, the stock is incredibly robust, one of the main reasons why it’s such a great long-term investment.

In addition, though, Brookfield is also constantly looking at which of its assets that it can sell at a premium and where it can reinvest those funds in a new, undervalued opportunity. This continuous capital recycling is why Brookfield aims to consistently generate annual returns of 12% to 15%, and increase its distribution by 5% to 9% annually.

Plus, after the stock has pulled back from its highs this year, it now offers an attractive yield of roughly 5.75%. So if you’re looking for top Canadian stocks that offer exciting yields, Brookfield Infrastructure is certainly one you’ll want to check out.

A top Canadian stock offering an attractive and growing yield

In addition to Brookfield, another lesser-known Canadian dividend stock you may want to consider over the big banks is Pizza Pizza Royalty (TSX:PZA) and its attractive dividend yield of roughly 6.6%.

Pizza Pizza is an excellent stock to buy if you’re looking to boost your passive income because it’s a stock that’s made specifically for dividend investors.

By collecting a royalty from each of its hundreds of locations across the country, Pizza Pizza is constantly generating significant cash flow, which it essentially pays all back to investors after expenses and taxes.

Plus, with Pizza Pizza being one of the best-known brands in Canada and a convenient, low-cost option, it has the potential to continue to weather the storm as the economy worsens, similar to what we’ve already seen over the last year.

In fact, out of all the restaurant stocks in Canada, it was impacted the least by the pandemic and has since increased its dividend on eight separate occasions since slightly trimming its dividend at the start of the pandemic.

So if you’re a Canadian investor looking to boost your passive income and buy stocks with attractive yields, Pizza Pizza is one of the top businesses on the market to consider today.

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 Daniel Da Costa has positions in Brookfield Infrastructure Partners. The Motley Fool recommends Brookfield Infrastructure Partners. The Motley Fool has a disclosure policy.

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