The S&P/TSX Composite Index has started 2024 on a strong note as it posted a fresh record high in April. While several factors, including better-than-expected economic growth, have driven the Canadian stock market to new heights of late, persistent inflationary pressures amid moderate economic growth could also make it less likely that the Federal Reserve will make steep cuts in interest rates anytime soon.
Since these delays in interest rate cuts could make stocks volatile again, investors might want to keep some reliable dividend stocks in their portfolios to keep earning stable passive income. Here are two TSX stocks that offer reliable dividends and could be great picks for your passive-income portfolio in 2024.
Pembina Pipeline stock
Pembina Pipeline (TSX: PPL) is the first TSX dividend stock you can consider for earnings reliable passive income in 2024. This Calgary-headquartered energy firm owns a diversified network of pipelines and terminals for the transportation and processing of oil, natural gas, and natural gas liquids across North America. It currently has a market cap of $28.6 billion as its stock trades at $49.31 per share with more than 8% year-to-date gains. At this market price, PPL stock offers a 5.5% annualized dividend yield and distributes these payouts every quarter.
Even as high volatility in commodity prices has affected the energy sector over the last few years, Pembina’s long-term financial growth trends have remained positive. In the last five years, the company’s total revenue has gone up by 24%, from $7.4 billion in 2018 to $9.1 billion in 2023. Similarly, its adjusted earnings jumped 31% during this period from $2.28 per share in 2018 to $2.99 per share in 2023. More importantly, its adjusted net profit margin expanded from 15.7% to 18.1% in these five years, reflecting its ability to continue generating higher profits even in difficult economic environments.
As Pembina continues focusing on low-carbon projects, operational improvements, and the fast-growing renewable energy sector, its long-term growth outlook remains strong, making it a trustworthy dividend stock to own for years to come.
IGM Financial stock
IGM Financial (TSX: IGM) is another top reliable dividend stock on the Toronto Stock Exchange you can add to your portfolio in 2024. If you don’t know about it already, it’s a Winnipeg-headquartered wealth and asset management firm. While IGM generates most of its revenue from its wealth management operations, its asset management segment has also seen strong growth in recent years. After rallying by 12% in the last six months, its stock currently trades at $34.39 per share with a market cap of $8.2 billion. IGM stock has an impressive 6.6% annualized dividend yield at the current market price.
Although IGM’s revenue has remained largely unchanged in the last five years, its adjusted earnings have gone up by around 5% from $3.29 per share in 2018 to $3.44 per share in 2023. The company recently made strategic realignments to its business segments to enhance clarity and focus. The wealth management segment now includes IG Wealth Management, along with investments in Rockefeller Capital Management and Wealthsimple.
Besides these initiatives, IGM’s increasing stake in ChinaAMC is helping it enhance its footing in the Asian markets, which could accelerate the financial growth of this top TSX dividend stock over the long term.
