5 “Forever” Dividend Stocks to Build Your Wealth

If you’re looking for dividend stocks you can happily hold forever, consider these five. Some with more growth in returns than others.

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Canadian dividend investors tend to get blinders on when they want passive income. All they care about are dividends and more dividends, and that means finding a high yield. Right?

Unfortunately, if you want a dividend stock that’s going to last forever, you’ll need to look for more than just a high yield. So today, we’re going to look at five forever dividend stocks — ones that offer not just dividend income but returns as well as a strong payout ratio. That way, you can be sure these dividend stocks will keep paying up forever and a day.

Granite REIT

If you’re looking for dividend income, then real estate investment trusts (REIT) are likely already on your list. However, there aren’t many that provide investors with forever income. Yet one that certainly does is Granite REIT (TSX:GRT.UN).

Granite REIT offers exposure to the highly in demand area of industrial properties. Whether it’s assembly lines or storage, the company continues to expand as demand continues. It offers a 4.74% dividend yield, with a payout ratio currently at 148%. That’s not ideal, but has been improving as share prices continue to rise. And with very little debt, it’s a growing dividend stock to consider.


Another strong option among REITs is Canadian Apartment Properties REIT (TSX:CAR.UN). If you’re looking for more demand, then apartments are certainly in demand. CAPREIT has a diverse and growing apartment, townhouse, and multi-use properties worldwide.

The dividend stock currently has a 3.37% dividend yield and a 166% payout ratio — again, higher than we’d like. But as the share price improves, so too will the payout ratio. So, I would consider getting in while there is value.


Finally, there are the Canadian banks. These are strong investments for those seeking dividend income, as the Canadian banks are frankly so large. There really is just no competition for this oligopoly, which allows investors to look for safe income, both in terms of returns as well as dividend income. 

When it comes to safe and growing dividend income, I would consider the top three by market cap: Royal Bank of Canada (TSX:RY), Toronto Dominion Bank (TSX:TD), and Canadian Imperial Bank of Commerce (TSX:CM).

RY stock currently has a dividend yield of 4.05% and a safe and steady payout ratio of 50%. Plus, shares are starting to rise near 52-week highs once more. TD stock, meanwhile, has a 5.07% dividend yield and another safe dividend-payout ratio of just 61%. Again, while more work needs to be done, the stock is edging towards 52-week highs.

CIBC stock might take a bit longer to reach those all-time highs due to its exposure to the housing market. However, it currently holds a strong dividend yield at 5.49%, with a payout ratio of 53%. What’s more, though, the stock has already passed 52-week highs, up 17% in the last year alone! So, it looks like you could gain some extra growth from this stock as the market recovers.

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 Amy Legate-Wolfe has positions in Canadian Imperial Bank Of Commerce, Royal Bank Of Canada, and Toronto-Dominion Bank. The Motley Fool recommends Granite Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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