Got $5,000? These 2 High-Yielding Dividend Stocks Are Trading Near Their 52-Week Lows

These high-yielding dividend stocks are perfect for investors looking for a deal, and who’ll be paid to wait it out!

| More on:
A stock price graph showing growth over time

Image source: Getty Images.

Canadian investors may still be waiting around wondering what to do with their savings. But let me tell you, it certainly isn’t working for you if you’re letting it sit there. Money sitting is money not invested. And money that isn’t invested is money that’s being wasted.

But granted, many stocks out there continue to offer lower returns. Which is why today we want to look for high-yielding dividend stocks. But before you pick them up, there are a few things to know.

What to consider

If you’re considering high-yield stocks, investors should consider a few things before diving in. First off, high-yield stocks often come with higher risks. Determine your risk tolerance level before investing, as higher returns typically accompany higher risks. Furthermore, look for companies with a history of stable or growing dividends. Analyze the company’s financial health, cash flow, and payout ratio to ensure the dividends are sustainable in the long term.

From there, investors will want to consider the industry the company operates in and the current market trends. Some industries may be more stable than others, while others may be more prone to volatility. Plus, there is also the company’s fundamentals. This would include revenue growth, earnings stability, debt levels, and competitive positioning within its industry.

Finally, is the dividend stock even a good value? Assess whether the stock is undervalued, overvalued, or fairly valued based on metrics such as price-to-earnings ratio (P/E), price-to-book ratio (P/B), and dividend yield compared to historical averages and industry peers. This goes for the dividend yield as well. A high dividend yield is attractive, but also consider the potential for future dividend growth. Companies that consistently increase their dividends over time can provide higher total returns. So now, let’s look at two high-yielding dividend stocks that might fit the bill.

BCE

The first stock that investors may want to consider among high-yielding dividend stocks is BCE (TSX:BCE). BCE stock is one of Canada’s largest telecommunications companies, providing a comprehensive suite of broadband communication services to residential and business customers across the country. The company offers a stable business model and strong market position, with diverse revenue sources and robust cash flow generation.

However, shares have fallen to 52-week lows on earnings. The company stated during its most recent earnings report that BCE stock finally saw some growth after falling from pandemic levels. The stock reported consistent free cash flow generation at $85 million, with strong performance from its key business segments.

BCE stock went on to reaffirm all of its 2024 guidance. So while net earnings and adjusted earnings per share are lower, the company still looks stable. And with an 8.63% dividend yield and shares near 52-week lows, it looks like a strong dividend stock to consider researching further.

Northland Power

Another company that investors can take advantage of near 52-week lows is Northland Power (TSX:NPI). The monthly-paying dividend stock is a Canadian renewable energy company that develops, owns, and operates sustainable power generation assets. Its focus is on renewable energy, providing investors exposure to the growing sector.

NPI stock also offers stable and predictable revenue, with a diversified portfolio of renewable energy assets and strong growth prospects. Furthermore, NPI stock has committed to dividend payments, with robust financial performance thanks to the nature of renewable energy assets.

This resilient business performance was demonstrated during its most recent fourth-quarter earnings. The dividend stock reported a few growth opportunities, such as offshore wind projects, as well as strong cash flow generation. Management remains optimistic about 2024, despite a decline in net income and sales down compared to the year before. So with shares near 52-week lows and a 5.53% dividend yield, it too looks like a strong dividend stock to consider.

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 no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

More on Dividend Stocks

investment research
Dividend Stocks

2 TSX Stocks to Buy in 2024 and Hold for the Next 10 Years

Are you looking for some great TSX stocks to buy in 2024? The market is full of options, but these…

Read more »

Retirement
Dividend Stocks

Pensioners: 2 Stocks That Cut You a Cheque Each Month

Monthly pay dividend stocks like First National Financial (TSX:FN) cut you a cheque each month.

Read more »

money cash dividends
Dividend Stocks

Want Decades of Passive Income? 2 Energy Stocks to Buy Now and Hold Forever

Are you wondering what TSX energy stocks could pay and grow their dividends for decades ahead? Here are two for…

Read more »

The sun sets behind a power source
Dividend Stocks

2 No-Brainer Utilities Stocks to Buy Right Now for Less Than $200

These two utilities stocks can be some of the best picks for investors if you want to shell out some…

Read more »

financial freedom sign
Dividend Stocks

Million-Dollar TFSA: 1 Way to Achieve to 7-Figure Wealth

Achieving seven-figure TFSA wealth is doable with two large-cap, high-yield dividend stocks.

Read more »

analyze data
Dividend Stocks

How Much Will Manulife Financial Pay in Dividends This Year?

Manulife stock's dividend should be safe and the stock appears to be fairly valued.

Read more »

food restaurants
Dividend Stocks

Better Stock to Buy Now: Tim Hortons or Starbucks?

Starbucks and Restaurant Brands International are two blue-chip dividend stocks that trade at a discount to consensus price targets.

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Dividend Stocks

1 Growth Stock With Legit Potential to Outperform the Market

Identifying the stocks that have outperformed the market (in the past) is relatively easy, but selecting the ones that will…

Read more »