Amid monetary easing initiatives by the central banks of the United States and Canada, the S&P/TSX Composite Index is up 16% this year. However, yesterday, the Labor Department of the United States announced that the annual inflation rate in September rose 2.4%, which was 0.1% higher than analysts’ projections. Higher inflation could slow down the central banks’ monetary easing initiatives. Further, the ongoing Middle East conflict is also a cause of concern.
If you are also worried about the uncertain outlook, you can buy the following three dividend stocks that have doubled their payouts over the last five years, indicating the strength of their financials. These stocks can provide stability to your portfolio.
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goeasy
goeasy (TSX:GSY) is a financial services company offering lending and leasing services to subprime customers. The lender provides various products covering the entire non-prime credit market, allowing it to grow its loan portfolio faster. The company, which started its consumer lending business in 2006, took 13 years to reach a $1 billion loan portfolio. However, since then, its loan portfolio has more than quadrupled to $4.1 billion at the end of the second quarter of 2024. These expansions have boosted the company’s financials, thus allowing it to pay dividends uninterruptedly since 2004. Meanwhile, GSY currently pays a quarterly dividend of $1.17/share, translating into an annualized rate of $4.48/share. The company has raised its dividends by around 277% in the last five years at an annualized rate of 30.4%.
Moreover, goeasy continues strengthening its digital infrastructure, expanding its product offerings, and adding new delivery channels to drive its loan portfolio. Also, it has implemented tighter underwriting requirements and next-gen statistical credit models, which could lower defaults and boost its profitability. The company’s management expects its loan portfolio to grow by 50% from its current levels to $6.2 billion by the end of 2026 while expanding its operating margin to 42%. Considering all these factors, I expect goeasy to be well-equipped to continue its dividend growth in the coming years.
Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) operates a balanced asset base. The company would break even at crude oil trading around US$40/barrel, given its effective and efficient operations and low-risk, long-life reserves. With oil prices trading substantially higher, it generates healthy cash flows, thus allowing it to raise its dividends consistently. Management recently raised its quarterly dividend by 7% to $0.5625/share for 2025, making the 25th consecutive year of dividend hikes at a CAGR (compound annual growth rate) of 21%. Over the last five years, the company has raised its dividends by 185% at an annualized rate of 23.3%.
Meanwhile, the ongoing Middle East conflict has increased oil prices by around 13% compared to this month’s lows. Further, analysts predict that the conflict escalation could drive oil prices higher. Moreover, CNQ has planned to invest around $5.4 billion this year, strengthening its oil and natural gas production capabilities. Also, with its net debt falling below $10 billion, the company’s management hopes to return 100% of its free cash flows to its shareholders, thus making its dividends safer.
Dollarama
Another Canadian stock that has doubled its dividends over the last five years is Dollarama (TSX:DOL), a discount retailer with an extensive presence across Canada. Given its superior direct-sourcing method and effective logistics, the company is able to offer a wide range of consumer products at compelling prices, thus enjoying healthy sales even during a challenging macro environment. So, it generates solid cash flows, allowing it to raise its dividends 13 times since 2011.
Meanwhile, Dollarama has raised its dividends by 109% over the last five years at an annualized rate of 15.9%. With a quarterly dividend of $0.092/share, the company’s forward dividend yield is 0.26%. Further, the company plans to expand its store count to 2,000 units by 2031, adding around 420 stores over the next six years. Further, its subsidiary, Dollarcity, has plans to expand its store count to 1,050 from the current 470 units over the next six years. These growth initiatives could boost its financials, thus allowing it to maintain its dividend growth.
