The Smartest Dividend Stocks to Buy With $400 Right Now

Even with just $400, these dividend stocks could help Canadians build a solid income-generating portfolio.

As the TSX Composite benchmark continues soaring in 2024, income-focused investors may be feeling like it’s harder than ever to find affordable dividend stocks that offer good yields and long-term growth potential.

But you don’t need thousands of dollars to start building a reliable income stream. Even with just $400, you can invest in some of the best dividend stocks that provide both value and stable passive income.

Here are two Canadian stocks to buy and watch your investments grow steadily while earning regular income.

Dog smiles with a big gold necklace

Source: Getty Images

B2Gold stock

B2Gold (TSX: BTO) tops my list of smart dividend stocks to buy right now. This Vancouver-headquartered gold producer has a market cap of $5.6 billion, and its stock trades at $4.23 per share after rallying 13.1% in the past three months. At the current market price, BTO stock has a 5.1% annualized dividend yield.

In the second quarter of 2024, B2Gold reported gold production of 212,508 ounces, slightly below expectations, mainly because of equipment delays at its flagship Fekola mine in Mali. Nevertheless, the company is addressing these issues, which should improve its mining rates in the coming months. Despite the temporary dip in production, B2Gold’s operational efficiency remains strong. The company posted cash operating costs of US$839 per ounce produced, sitting at the low end of its annual guidance range.

While delays in mining higher-grade ore from the Fekola mine pit are likely to affect its production in 2024, B2Gold expects production levels to pick up next year, which could drive its stock price higher. Along with its stable operational efficiency, B2Gold’s strong balance sheet gives the company the flexibility to weather any short-term challenges, making it a really attractive dividend stock to buy for the long term.

Birchcliff Energy stock

Birchcliff Energy (TSX: BIR) could be another smart investment for income investors right now. This Calgary-headquartered natural gas and oil producer currently has a market cap of $1.6 billion and specializes in the Montney/Doig Resource Play in Alberta, one of Canada’s most prolific natural gas and liquids-rich regions. After climbing 22% over the past eight months, BIR stock now trades at $5.91 per share and offers an attractive 6.8% annualized dividend yield.

In the latest quarter ended in June, Birchcliff delivered strong operational performance, reporting an average production rate of 78,358 barrels of oil equivalent per day, with 83% of its output coming from natural gas. The company generated $53.7 million in adjusted funds flow during the quarter, which translated to $0.20 per share. This robust performance was primarily driven by better-than-expected results from 11 new wells brought into production, which exceeded its projections.

Birchcliff recently signed a long-term agreement to operate AltaGas’s deep-cut gas processing facility in Gordondale. This agreement is expected to boost Birchcliff’s profitability by reducing its operating costs and improving natural gas liquids recovery. Given these strong fundamentals, BIR stock could be an excellent long-term investment to generate reliable dividend income for years.

Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool recommends B2Gold. The Motley Fool has a disclosure policy.

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