The Top 2 Dividend Stocks I’d Consider Buying in January 2024

As another year of stock market investing comes into full swing, these two TSX dividend stocks will find their way in my portfolio in January 2024.

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Historically, the economy takes around three years after a major macro event occurs to recover fully. If the trend holds true, this January should mark a complete recovery for the Canadian market.

After a series of aggressive key interest rate hikes by central banks, cooling of inflation, and the potential of interest rates being cut, we might be looking at a complete recovery from the pandemic-induced chaos that began in 2024.

That said, the first half of 2024 might remain challenging. While interest rates have halted, they remain at a high 5%. If things go according to plan, we might see rate cuts soon. The market indeed does look hopeful in 2024. Rate cuts could cause a bull run on the stock market, driving share prices higher across the board.

Before that happens, it might be wise to shore up on dividend stocks with inflated dividend yields to lock in higher-yielding dividends in your self-directed investment portfolio. Today, I will discuss two top dividend stocks I would add to my holdings for this purpose.

BCE

BCE (TSX:BCE) is a $49.63 billion market capitalization heavyweight in the Canadian telecommunications space, holding a significant chunk of the market share in the industry. The stock has long been a staple holding for income-seeking investors due to its solid long-term growth and reliable dividend payouts.

With rising inflation and higher interest rates, 2023 was a difficult year for BCE stock investors. Higher expenses due to interest rates being high weighed on companies across the board, including BCE stock.

After fluctuations through most of the year, its declining share prices led to BCE stock boasting unusually high dividend yields. As of this writing, BCE stock trades for $54.40 per share, boasting a 7.11% dividend yield. With a recovery to better share prices on the horizon, it might be a good idea to lock in its high-yielding dividends right now.

Enbridge

Enbridge (TSX:ENB) is a $104.65 billion market capitalization multinational pipeline and energy company headquartered in Calgary. The company boasts a massive energy infrastructure network responsible for transporting around a fifth of all the crude used in the United States. Its network transports crude oil, natural gas, and natural gas liquids, making the business essential to the North American economy.

Enbridge is also expanding its renewable energy operations to prepare for a greener future for the energy industry. The company is also acquiring three U.S.-based gas utility businesses to generate stable cash flows and minimize its dependence on transporting oil products, which accounts for over half of its revenue.

Higher interest rates have impacted it as well. As of this writing, it trades for $49.18 per share, boasting a 7.44% dividend yield that is too attractive to pass up on.

  • We just revealed five stocks as “best buys” this month … join Stock Advisor Canada to find out if Enbridge Inc. made the list!

Foolish takeaway

Dividend investing is an excellent way to achieve your short- and long-term financial goals. Whether you want to build a portfolio that provides you with a passive income or use the power of compounding to accelerate your wealth growth, the right mix of dividend stocks can help you achieve that.

To this end, high-quality and high-yielding dividend stocks like BCE stock and Enbridge stock can be terrific holdings to consider for your self-directed portfolio.

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 Enbridge. The Motley Fool has a disclosure policy.

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