Dividend stocks can take many forms, with dividend-paying companies carrying varying yields and operating in a wide range of sectors. However, some dividend stocks are clearly better than others, and I’ve got three on this list that I think long-term investors can buy right now for big long-term gains.
Let’s dive into why these three companies ought to at least be on investors’ radars and where they could be headed from here.
Fortis
Fortis (TSX:FTS) is a leading North American utility company that provides electricity and natural gas to consumers across Canada, the U.S., and the Caribbean. With over $60 billion in assets, Fortis operates in a highly regulated industry, which helps ensure stable revenue streams and predictable cash flows. Thanks to its impressive record of dividend growth, the company has also become a top dividend stock for income investors.
Fortis has a 50-year consecutive dividend increase history, with the current yield dividend around 4%. All these factors make the stock extremely attractive, as the company offers stable income to its investors.
Moreover, utility companies like Fortis are always in a good position to ride out the recession. The $22.3 billion capital growth five-year plan has a specific design to enhance and expand the company’s regulated utility businesses. Such efforts are expected to facilitate earnings and cash flow growth, a key catalyst for attaining long-term annualized dividend growth of 4% to 6%.
Manulife Financial
Manulife Financial (TSX:MFC) is one of Canada’s largest insurance companies, with a strong international presence in North America, Asia, and Europe. The company provides life insurance and investment services to a wide range of clients. It has delivered solid performance in the past few years, making it a top dividend pick.
Manulife offers a decent dividend yield of around 3.8%, much higher than most finance dealing stocks. As such, it is attractive to income-hungry investors, and the return is very stable, irrespective of the prevailing market conditions. The company has a diversified revenue base with operations in life insurance, wealth management, and retirement planning services. Its recent earnings have shown resilience and are supported by strong growth in Asia and stable performance in its North American operations.
Given the increasing middle class and the rapidly growing demand for life and health insurance in Asia, Manulife is well-positioned to capitalize on this market. The international presence of Manulife has long-term growth prospects, further supporting the stability of the dividend.
Dream Industrial REIT
Dream Industrial REIT (TSX:DIR.UN) owns and manages high-quality industrial properties in Canada, the US and Europe. The company is well-positioned to capitalize on the growth of e-commerce and global supply chain expansion. In addition, real estate investment trusts (REITs) like Dream Industrial offer an excellent opportunity for investors to access real estate dividends without the capital requirements of direct property ownership.
At current levels, Dream Industrial REIT provides a yield of roughly 5.2% and is one of the higher-yielding deals available on the TSX in this regard. It creates a lot of steady income for individuals looking for this type of investment with passive income at these low-interest levels. In addition, the portfolio of Dream Industrial contains various geographical areas, not concentrated in one region.
Most recent European acquisitions further diversify its holdings and increase the scope for growth while reducing related risks. Hence, focusing on high-quality, well-located properties in areas with inelastic demand is a strategy for sustainable growth.
