If you are planning to retire soon, securing a reliable income stream is likely at the top of your mind. One way to achieve that is by investing in high-quality, dividend-paying stocks. These stocks can provide consistent income even after you stop working, making them a popular choice for any retirement portfolio.
The TSX has many well-established companies known for their resilient dividend payouts. What makes these stocks attractive for retirees is the durability of their payouts, backed by their growing earnings base and management’s focus on rewarding its shareholders.
With this backdrop, add these Canadian stocks with fundamentally strong businesses you may want to consider for steady passive income.
Enbridge stock
Enbridge (TSX: ENB) is a top stock for reliable income. The energy company is known for rewarding its shareholders with higher dividend distribution regardless of economic and commodity cycles. Moreover, its high yield and visibility of future earnings growth make it a must-have stock for retirees seeking steady income.
Enbridge has increased its dividend for 29 years. Moreover, its dividend has grown at a compound annualized growth rate (CAGR) of 10%. Enbridge projects its earnings and distributable cash flow (DCF) per share to grow at a CAGR of roughly 5% in the long term, which will drive its dividends and support future payouts.
With a diverse range of revenue streams, a vast network of liquid pipelines, and long-term contracts, Enbridge is well-positioned to generate stable cash flow. Further, its investments in low-risk, utility-like projects and strategic acquisitions will enable the company to continue paying and increasing dividends. Currently, Enbridge offers an attractive yield of 6.6%, making it an excellent option for income-focused investors.
BCE stock
BCE (TSX: BCE) is one of the top high-yield TSX stocks that generates resilient passive income. Known for its consistent dividend growth, this telecom giant has a solid reputation for rewarding its shareholders. BCE has increased its dividend for 16 consecutive years, demonstrating its commitment to shareholders and ability to steadily grow earnings.
The telecom company’s focus on growing its subscriber base profitably and cost reduction measures support its higher payouts. Further, BCE’s investments in high-performance broadband fibre and 5G mobile networks position it well to expand its user base and lower churn. Additionally, BCE has evolved its business model, tapping into the growing demand for digital advertising, cloud computing, and security services.
These moves position it well to grow profitably and support future dividend payments. It currently offers an attractive yield of 8.3%.
Fortis stock
Fortis (TSX: FTS) could be an attractive choice if you are retiring soon and seeking a steady income. This electric utility company has an impressive record of 50 consecutive years of dividend growth, making it a dependable option for those looking for long-term income.
Fortis’s ability to consistently grow its dividends stems from its regulated earnings base, which ensures predictable cash flows regardless of market conditions. This stability allows the company to keep delivering dividends even during economic downturns.
Fortis plans to invest $25 billion in capital projects by 2028. This investment is expected to grow its rate base by around 6.3% annually. As the company expands its assets, its earnings will likely increase, providing the foundation for even higher dividend payments.
Fortis forecasts its dividends will grow by 4-6% annually through 2028. Currently, the stock offers a well-protected dividend yield of approximately 3.8%, providing a reliable source of passive income.
