3 Stocks Ready for Dividend Hikes in 2024

These three stocks are not only primed to increase their dividends again this year; they are three of the best stocks to buy on the TSX.

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Despite another year with so much uncertainty in the economy and interest rates still well off their lows, many high-quality Canadian stocks continue to find ways to grow their businesses and offer dividend hikes to their shareholders in 2024.

This is crucial for a few reasons. Firstly, it’s important for investors to find the highest-quality stocks on the market that you can buy and commit to holding for years to come.

The fact that numerous high-quality stocks are primed for dividend hikes this year means that not only are they some of the best businesses to buy now as they continue to find ways to operate in this environment, but they are also some of the highest-quality and reliable stocks since many others continue to struggle in this economic landscape.

So, with that in mind, if you’re looking for high-quality stocks that you can buy and hold with confidence and that can continue to increase the dividends they are paying, here are three of the best Canadian stocks to consider adding to your portfolio today.

One of the best Canadian stocks to buy for consistent dividend increases

There’s no question that one of the best dividend stocks Canadian investors can buy both for reliability and consistent dividend increases is Fortis (TSX:FTS), the massive utility stock. In fact, Fortis has the second-longest dividend-growth streak in Canada at a whopping 50 straight years.

Fortis is an ideal stock to buy today due to its reliable business model, its ability to continue earning a profit no matter what the economic environment as well as the passive income it provides and consistent increases to the dividend each year.

In addition, though, Fortis is also a stock to buy now before interest rates continue to fall. Although Fortis is one of the least volatile stocks on the market, one of the biggest factors impacting its share price and keeping the stock off its 52-week high has been higher interest rates.

So, with the Bank of Canada now in the process of lowering interest rates and the Federal Reserve expected to follow suit by the end of the year, now is the time to scoop up Fortis shares before they inevitably rally.

Today, Fortis offers a yield of roughly 4.3%, and with the stock typically increasing its dividend toward the end of the calendar year, the passive income that Fortis generates and the reliability of its operations make it one of the best Canadian dividend stocks to buy now.

A top Canadian telecom stock

While utility stocks are some of the best Canadian dividend stocks, telecommunications is another industry with high-quality companies consistently generating tonnes of cash flow. And right now, Telus (TSX:T) looks like one of the best stocks to buy on the TSX.

Although its 19-year dividend-growth streak is nowhere near as long as Fortis’s, it’s certainly still impressive. Furthermore, Telus is a stock that typically increases its dividend twice a year — something you don’t often see.

So, although it’s already increased its dividend in 2024, there’s a strong possibility it could increase the dividend again in the fourth quarter. It’s also worth noting that analysts estimate a 7% annual growth in the dividend for at least the next three years, which is a considerable increase, especially for such a large and established stock.

A high-potential growth stock that’s consistently increasing its dividend

Lastly, Alimentation Couche-Tard (TSX:ATD) is one of the highest-quality stocks on the market that’s due for a dividend increase this year.

Couche-Tard, though, doesn’t pay much of a dividend at all right now. Despite having a dividend-growth streak of 13 straight years, it only offers a yield today of roughly 0.9%. However, that’s because Couche-Tard is still growing its business rapidly and reinvesting most of its earnings into future growth.

So, although the stock shows no signs of slowing down, the larger it gets, the harder it will be to continue growing at such an impressive pace, and when it does, and there is less growth potential available, Couche-Tard will likely elect to begin paying more money back to investors.

So, if you’re looking for a high-quality Canadian stock to buy now and hold for years, Couche-Tard is certainly one to keep your eye on.

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 Daniel Da Costa has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard. The Motley Fool recommends Fortis and TELUS. The Motley Fool has a disclosure policy.

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