Soaring Dividends: 2 TSX Stocks Delivering Value at All-Time Highs

Buying these value TSX dividend stocks today can help you lock in high dividend yields and strong returns over the long term.

| More on:
Arrowings ascending on a chalkboard

Image source: Getty Images.

The Canadian stock market is hitting new highs in 2024. However, some investors are still worried about a potential downside correction as macroeconomic uncertainties continue to hurt sentiments amid persistent inflationary pressures. If you are looking for ways to protect your portfolio and generate passive income in the long run, investing in TSX dividend stocks could be a smart option. Dividend income can cushion the impact of market volatility, and many such stocks with strong growth prospects can deliver capital appreciation as well, which can grow your invested money faster over time.

In this article, let’s look at two top dividend stocks that are paying soaring dividends even as the Toronto Stock Exchange is hovering close to its all-time highs. While these stocks haven’t participated in the recent broader market rally, they have strong fundamentals and attractive valuations that make them appealing value buys right now.

BCE stock

BCE (TSX:BCE) is the first value TSX stock with reliable dividends you can consider buying at a bargain right now. This Verdun-based telecommunications giant currently has a market cap of $41.6 billion as its stock trades at $45.23 per share after sliding by around 30% in the last year. The recent declines in its share prices, however, have made BCE’s annualized dividend yield look even more attractive, which currently stands at an impressive 8.8%.

Despite facing macroeconomic challenges, BCE managed to meet all its financial guidance targets last year. The company’s revenue rose 2.1% YoY (year over year) to $24.7 billion during the year with the help of increases in its consumer wireless, digital media, and residential internet segments. Similarly, its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) also rose more than 2%, and its adjusted EBITDA margin stood unchanged on a YoY basis at 42.2%.

I find BCE’s long-term financial growth outlook strong despite the short-term macroeconomic challenges due mainly to its disciplined focus on high-value subscriber growth, coupled with its ongoing investments in 5G and broadband technologies. Interestingly, BCE stock has been raising dividends for 16 consecutive years, making it a very reliable dividend stock to generate passive income.

Superior Plus stock

Superior Plus (TSX:SPB) could be another solid bet for investors looking for steady passive income. Even as the broader market recently touched record highs, shares of this Toronto-headquartered energy firm have slipped by around 7% in the last year, making it look undervalued to buy for the long term based on its robust fundamentals. With this, SPB stock trades at $9.33 per share with a market cap of $2.3 billion. The stock offers an attractive 7.7% annualized dividend yield at the current market price.

Last year, Superior Plus registered an impressive 22.6% YoY increase in its adjusted EBITDA to $551.6 million as its well-established propane distribution operations generated robust cash flows. Having pursued an aggressive growth strategy with new acquisitions in recent years, the company now aims to fuel growth by reinvesting its own funds and reducing its leverage ratio. Despite this shift, Superior expects to see further growth in its adjusted EBITDA in 2024. Given these positive factors, SPB could be an amazing TSX dividend stock to buy on the dip right now.

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.

The Motley Fool recommends Superior Plus. The Motley Fool has a disclosure policy. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

More on Dividend Stocks

Business success with growing, rising charts and businessman in background
Dividend Stocks

5 TSX Stocks With High Dividend Growth to Buy Now

These TSX stocks sport a high dividend growth rate and are known for consistently rewarding their shareholders with increased cash.

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

Canadian Blue-Chip Stocks: The Best of the Best for May 2024

These two blue-chip stocks are up in 2023, sure, but have seen even more growth in the last few decades.…

Read more »

Couple relaxing on a beach in front of a sunset
Dividend Stocks

Passive Income: How to Make $33 Per Month Tax-Free by Doing Nothing

Hold monthly paying dividend stocks such as Exchange Income in your TFSA to begin a tax-free stream of passive income…

Read more »

data analyze research
Dividend Stocks

Is Telus Stock a Buy on a Dip?

Telus is down more than 20% over the past year and now offers a great dividend yield.

Read more »

A plant grows from coins.
Dividend Stocks

2 Top Dividend-Growth Stocks to Buy in May

These two dividend stocks saw major growth after earnings that promised more was coming in the future. And now could…

Read more »

Dots over the earth connecting the world
Dividend Stocks

Best Stocks to Buy in May 2024: TSX Telecommunication Services Sector

The telecommunication services sector is currently going through an upheaval. It is a good time to buy these stocks.

Read more »

Dividend Stocks

Bulletproof Income: How to Earn Safe Dividends With Just $10,000

These Canadian dividend stocks have the potential to sustain and increase their payouts for years under all market conditions.

Read more »

warning or alert
Dividend Stocks

Attention, Cautious Investors: This Top Dividend King Just Climbed 7% and Can Keep Going

Fortis (TSX:FTS) stock is still down 10% in the last year but up 7% on strong earnings that demonstrate more…

Read more »