Dividend-paying stocks are a great source of passive income. Thankfully, the TSX has several fundamentally strong stocks, like Fortis and Enbridge, that have increased dividends for decades. This makes them an excellent investment for generating worry-free income.
While Fortis and Enbridge are undoubtedly top income stocks, I’ll focus on companies growing their dividends insanely fast.
With this backdrop, let’s look at three Canadian stocks with an impressive dividend growth history.
Canadian Natural Resources
Speaking of reliable stocks with insanely fast dividend growth, Canadian Natural Resources (TSX: CNQ) tops my mind. This crude oil and natural gas production company is known for rewarding its shareholders with higher dividend payments. For instance, Canadian Natural Resources increased its dividend for 24 consecutive years. During this period, its dividend grew at a solid compound annual growth rate (CAGR) of 21%.
While the company has grown its dividend at a solid pace, investors have also benefitted from the significant appreciation in its share price. Notably, Canadian Natural Resources stock gained over 256% in five years, outperforming the broader market averages by a wide margin.
Canadian Natural Resources’s long-life and diversified asset base and high-value reserves will likely support its revenue and earnings. Further, its focus on cost control, low maintenance capital requirement, and solid balance sheet provide a solid foundation for future growth and are likely to drive its free cash flows and future dividends. CNQ pays a quarterly dividend of $1.05 a share, reflecting a yield of over 4%.
Cogeco Communications
Cogeco Communications (TSX: CCA) could be a solid addition to your portfolio. The company has a solid dividend payment and growth history. It offers internet, video, and phone services to residential and business customers. Notably, the company has consistently increased its dividend by over 10% annually in the past decade.
In November 2023, the company announced a 10.1% increase in its dividend to $3.42 for fiscal 2024. Based on its current dividend, it offers a compelling and reliable yield of 5.7%.
The company’s stable business model, growing scale, and operational efficiency will likely drive its earnings and free cash flows. The geographical expansion of its fibre-to-the-home offerings, acquisition of complementary broadband businesses, and plans to launch and grow mobile services in the U.S. and Canada will likely drive its addressable market, which in turn will drive its earnings and dividend payments.
goeasy
goeasy (TSX: GSY), which offers lending services to subprime borrowers, should be on your radar. The company’s ability to consistently increase its earnings at a solid double-digit rate enables it to grow its dividend incredibly fast. For instance, goeasy’s dividend has grown at a CAGR of 34% from 2014 to 2021. Moreover, from 2021, the company increased its dividend by 77% to $4.68 for 2024.
Along with stellar dividend growth, goeasy also delivered notable capital gains. Its stock is up about 1,077% in the past decade.
goeasy’s growing consumer loan portfolio, led by a large addressable market, omnichannel offerings, diversified funding sources, and geographic expansion will likely drive its top line. Meanwhile, higher sales, steady credit performance, and operating leverage will boost its earnings and support higher dividend payments.
