It has been a rough couple of years for many Canadian dividend stocks. Elevated interest rates have caused income-focused investors to prioritize safe bonds and GICs (guaranteed investment certificates) over dividend stocks.
Likewise, many dividend stocks utilize a lot of debt in their capital structure. Elevated rates have impacted their bottom line.
However, with interest rates coming down, now may be the ideal time to start looking at quality dividend stocks again. Here are three Canadian dividend stocks to take a shot at today.
An apartment REIT for income, growth, and value
BSR Real Estate Investment Trust (TSX:HOM.UN) is not a household name for most Canadians. That is because its garden-style apartment portfolio resides mostly in the U.S. sunbelt states (like Texas, Arkansas, and Oklahoma).
States like Texas are experiencing some of the fastest population and economic growth trends in all of North America. This is a favourable long-term trend for the REIT.
A massive amount of apartment supply has hit these markets in 2024. Near-term, that has hindered rental rate growth. Fortunately, the market is absorbing that supply in an orderly fashion and BSR’s rental rates have held up well.
The good news is that new supply is set to rapidly decline in 2025. All that means is that BSR could once again see very strong rental growth resume in its core Texas markets.
This REIT has a strong, well-hedged balance sheet. Likewise, the stock trades at a substantial discount to its U.S. peers (despite just as good or better fundamentals).
This dividend stock has been opportunistically buying back units. It also increased its distribution by 8% recently. BSR REIT yields 4.1% right now.
This REIT is a solid stock for predictable dividends
Another Canadian dividend stock to look at adding today is Granite REIT (TSX: GRT.UN). It may not be the fastest-growing stock. However, if it is stable returns and income that you want, that is what you will get with Granite.
It owns a portfolio of institutional quality industrial properties in Canada, the United States, and Europe. The REIT has high-end, investment-grade tenants with a majority of leases lasting over five years.
This REIT has a fortress-like balance sheet that can withstand a tough economy. Likewise, it has well-located assets and a prudent management team.
GRT.UN yields 4.3% today. That is likely better than you will do with a GIC today. Also, it has increased its distribution for 12 consecutive years. If it can continue to execute, there is no reason why its distributions shouldn’t keep rising in the years ahead.
A top infrastructure stock for dividends
If you aren’t interested in real estate but still want a solid yield, Pembina Pipeline (TSX: PPL) is a good bet. It provides a long list of infrastructure services to the energy industry in Western Canada. In many instances, its pipelines and midstream assets are the only way an energy producer can get their energy to market.
Pembina has done a great job of optimizing its assets to yield maximum free cash flow. Today, it stands with a sector-leading balance sheet that allows for ample investment flexibility.
Construction just commenced at its LNG (liquified natural gas) export facility in British Columbia. That could certainly contribute to its longer-term growth outlook.
This Canadian dividend stock yields 5%. It has also been growing its dividend by a low-single-digit rate in the past few years. There could be more income growth for patient investors in the years to come.
