Canada’s primary stock market plunged sharply to start August due to fears of recession across the border. However, there should be no worry if you own shares of Pembina Pipeline (TSX: PPL), Brookfield Asset Management (TSX: BAM), and Sun Life Financial (TSX: SLF).
The three blue-chip TSX stocks are dependable and stable passive-income providers regardless of the economic environment.
Long-term hold
Pembina Pipeline is an ideal stock for long-term passive income. At $52.94 per share, you can partake in the lucrative 5.21% dividend. Moreover, despite recent elevated market volatility, the energy stock is up 19.28% year to date. The dividend track record dates back to 1997, and payouts have been uninterrupted for 27 consecutive years.
This $30.8 billion energy major’s three business segments combine to provide energy transportation and midstream services (pipelines, facilities, marketing & new ventures). Pembina’s competitive advantages include an irreplicable pipeline network and extensive gas processing, fractionation, storage, and export facilities.
Pembina takes pride in its low-risk business model. Cash flows are predictable due to long-term contracts, where 80-90% are fee-based, and 65-70% are take-or-pay or cost-of-service. In April 2024, its midstream asset portfolio expanded following the acquisition of Enbridge’s interests in three midstream businesses.
Unquantifiable benefit
Investors must consider Brookfield Asset Management, whose assets and businesses are over US$900 billion and support the global economy. The $22 billion company invests in long-life, high-quality assets and boasts a Brookfield Ecosystem that covers 30 countries in five continents.
This alternative investment management firm has direct control investments in real estate, renewable power, infrastructure, credit, and private equity. Its publicly listed flagship companies include Brookfield Infrastructure Partners, Brookfield Renewable Partners, and Brookfield Business Corporation.
According to its chief executive officer (CEO), Bruce Flatt, value creation and sustainable development are complementary goals. BAM commits to both by buying, building, and holding great businesses for long periods. If you invest today, the share price is $56.51, while the dividend yield is 3.68%. The unquantifiable benefit is your peace of mind.
Diverse revenue streams
Sun Life Financial is a Dividend Aristocrat owing to eight consecutive years of dividend increases. The $38.5 billion life insurance and financial services company generates substantial revenue streams from various sources and has been highly profitable since 2020. At $66.59 per share, the dividend offer is 4.87%.
Management aims to make Sun Life Financial one of the world’s best asset management and insurance companies. It has a strong footprint in North America and is experiencing accelerating growth in Asia. While net income in the first quarter (Q1) 2024 grew by only 1% year over year to $818 million, profit in the fast-growing Asian market climbed 75% to $235 million compared to Q1 2023.
Sun Life’s executive vice president and chief financial officer, Tim Deacon, said the steady increase in total company CSM (contractual service margin) is a store of future profits. He also expects Sun Life to grow earnings in line with its medium-term financial objectives due to solid fundamentals and strong capital position.
Counter market pullbacks
Pullbacks, downturns, and crashes are recurring events in the stock market. Fortunately, there are blue-chip stocks like Pembina Pipeline, Brookfield Asset Management, and Sun Life Financial that can counter them and deliver long-term passive income.
