The TSX has several dividend stocks that regularly pay and increase their payouts, enabling investors to earn a worry-free passive income. Further, a few of these high-quality stocks offer ultra-high yields, making them more attractive for passive income.
With that backdrop, here are five ultra-high-yield Canadian stocks with solid fundamentals to buy in July. These dividend stocks offer at least a 6% yield.
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BCE
With an attractive yield of 9.3% based on the current closing price of $43.09, BCE (TSX: BCE) is one of the top ultra-high-yield dividend stocks investors could consider buying in July. Besides high yield, this telecom company is known for its durable payouts and focus on enhancing shareholders’ value through higher payouts. For instance, BCE increased its dividends for 16 consecutive years, which shows the resiliency of its payouts.
The telecom giant’s focus on growing its customer base, reducing costs, and improving efficiency positions it well to grow earnings in all market conditions. This will support its dividend payments. Further, BCE is targeting new growth areas such as digital transformation and cloud and security services. This bodes well for future growth and will support its payouts.
SmartCentres REIT
SmartCentres Real Estate Investment Trust (TSX: SRU.UN) is another compelling investment for investors seeking high yield and monthly income. This real estate investment trust (REIT) offers a monthly payout of $0.154 per share and sports an ultra-high yield of about 8.3%. Furthermore, this REIT’s payouts are backed by its high-quality real estate that generates robust same-property net operating income (NOI).
SmartCentres’s higher concentration of retail-focused properties adds stability to its cash flows. Further, its solid developmental pipeline of mixed-use properties augurs well for future growth. In addition, SmartCentres’ high occupancy rate, top-quality tenant base, and underutilized land bank position it well to generate a solid income, which will drive its payouts.
Enbridge
Enbridge (TSX: ENB) is a must-have ultra-high-yield dividend stock due to its stellar dividend payment and growth history. This Canadian energy infrastructure giant has consistently paid dividends for about seven decades (69 years, to be precise) and raised its yield at a compound annual growth rate (CAGR) of 10% for nearly three decades (29 consecutive years). Currently, it offers a yield of 7.5%.
Enbridge’s resilient business model and diversified revenue stream support the durability of its payouts. Its high-quality assets, power-purchase agreements, and long-term contracts will likely drive its distributable cash flows (DCF), supporting its dividend payouts. Additionally, Enbridge expects its earnings and DCF per share to continue to grow at a mid-single-digit rate in the long run, which paves the path for future dividend growth.
Scotiabank
For higher yields, investors can also rely on Scotiabank (TSX: BNS) stock in the banking space. This leading Canadian bank has paid uninterrupted dividends since 1833. Further, Scotiabank’s dividends have grown at a CAGR of 6% in the past decade. In addition, BNS stock offers a compelling yield of about 6.9%.
The financial services giant has exposure to high-growth markets and is focused on diversifying its revenue streams, which will support its earnings and drive payouts. Further, Scotiabank’s solid balance sheet and improved efficiency show that it is poised to enhance its shareholders’ wealth through higher dividend payments.
Canadian Utilities
Canadian Utilities (TSX: CU) is a compelling stock for income investors for its growing dividends and high and well-protected yield. It has been growing its dividend for 52 years, the longest by any Canadian company. Besides boasting an unmatched dividend-growth history, Canadian Utilities offers a healthy yield of over 6%.
Canadian Utilities’ defensive business model, growing rate base, and predictable cash flows support its dividend distributions and growth. The company is well-positioned to boost shareholders’ value via higher dividend payments as it invests in regulated utility assets and grows its rate base. This will enable it to expand its future earnings base and support its payouts.
