Stocks across the TSX came roaring back last year after a disappointing performance in 2022.
High-growth tech stocks led the way in terms of media coverage. The large amount of growth stocks that delivered market-crushing returns in 2023 garnered many of the news headlines.
As a growth investor myself, I’m as happy as the next stock picker about the returns in 2023. But after such an incredibly volatile past couple of years, what I’d urge investors to keep in mind is that there’s nothing wrong with a boring investing strategy. Chasing the next-hottest multi-bagger could result in continuously getting in at the top and selling at inopportune times.
Building a stream of passive income
There’s never a bad time to own a steady stream of passive income, and that’s especially true during volatile market periods. Fortunately, there’s no shortage of dependable dividend stocks for Canadian investors to choose from on the TSX.
Slow-growing dividend stocks certainly aren’t the most exciting companies around. However, they can be huge wealth generators for any investor that’s willing to be patient.
With that in mind, I’ve reviewed two top dividend stocks that should be on any passive-income investor’s radar in 2024.
On a year-to-year basis, the growth returns of these two stocks might not make any headlines. But with dependable, high-yielding dividends, the only thing investors need to do with these two companies is reinvest the dividends and then let compound interest work its magic.
Stock #1: Bank of Nova Scotia
When it comes to passive-income investing, Canadian banks are an excellent place to start. The Big Five can offer not only dependable payouts but top yields, too.
At today’s stock price, Bank of Nova Scotia’s (TSX:BNS) dividend yields a whopping 6.8%.
In addition to a top yield, the $75 billion bank has been paying out dividends to its shareholders for close to two centuries. You won’t find many other dividend stocks with a yield above 6% that also own a payout streak like that.
Part of the reason for the sky-high dividend is due to the stock’s decline over the past two years. Shares have struggled since early 2022, which has sent the dividend up. While this high yield may be short-lived, there could be a long-term value play for patient investors.
Stock #2: Brookfield Infrastructure Partners
Similar to the banking space, there’s not a whole lot to get excited about with the utility sector. However, if you’re looking for passive income and stability, a utility stock could be a perfect fit for your portfolio.
The beauty of utility stocks is their dependability. Volatility tends to be fairly tame in comparison to other sectors. That’s largely due to the predictable revenue streams of utility companies.
At a market cap of $20 billion, Brookfield Infrastructure Partners (TSX:BIP.UN) is a Canadian utility leader. The company also boasts an international presence, providing its shareholders with broad diversification in the space.
The company’s dividend is currently yielding just shy of 5%. It may not be at the same level as Bank of Nova Scotia, but you cannot discount the stability that Brookfield Infrastructure Partners can bring to a stock portfolio. The utility stock is also no stranger to outperforming the broader market’s returns.
