Investors looking to generate a steady passive income should consider adding top dividend stocks to their portfolios. These companies, known for their strong fundamentals, consistent payout histories, and high yields, not only offer reliable distributions but also present opportunities for dividend growth. With this background, here are three Canadian stocks that can supercharge your passive-income portfolio with high yield and dividend increases.
Dividend stock #1
Canadian Utilities (TSX:CU) is a top TSX stock to supercharge your passive income. This leading Canadian utility company is known for its stellar dividend growth history, resilient payouts, and worry-free high yield. The company’s defensive business model and regulated and contracted asset base enable it to generate high-quality earnings that drive its dividend payouts.
The utility company is a Dividend King. It has raised its dividend for 52 consecutive years, the highest by any Canadian company.
Its stellar dividend-growth history and growing rate base suggest that Canadian Utilities will likely enhance its shareholders’ value through higher payouts in the coming years. The company plans to invest $4.6 to $5 billion between 2024 and 2026 in its regulated utilities, which will significantly boost its earnings and cash flows, thus supporting its payouts. Moreover, its long-term, contracted investments and energy transition opportunities augur well for future earnings and dividend growth.
Besides resilient dividends, Canadian Utilities offers a well-protected yield of 5.2%.
Dividend stock #2
Enbridge (TSX:ENB) is another top stock to supercharge your passive income portfolio. The company transports oil and gas and has extensive liquid pipelines across top supply and demand zones. This drives the utilization of its assets and supports revenue and distributable cash flow (DCF). The company also benefits from its highly diversified revenue stream, long-term contracts, power purchase agreements, and arrangements to lower volume and commodity price risks.
Thanks to its resilient business model and high-quality earnings, Enbridge has paid dividends for over 69 years. Further, it increased them for 29 consecutive years. This streak will likely continue as the company is well-positioned to grow its earnings and DCF consistently, regardless of market conditions.
Enbridge’s management projects its bottom line and DCF per share to increase by about 5% annually in the long term. The energy company’s ongoing investments in conventional and green energy sources, multi-billion-dollar capital projects, and acquisition of three premier gas utilities in the U.S. will likely improve its cash flow and de-risk growth outlook.
In summary, Enbridge is well-positioned to increase its future dividend and offers an attractive yield of 6.2%.
Dividend stock #3
BCE (TSX:BCE) is a no-brainer stock for your passive income portfolio. The communication company has paid and increased its dividend for 16 years and offers a stellar yield of 10.2%. However, BCE faces some short-term challenges. Competitive pricing in the wireless market and broader economic headwinds have put pressure on its stock. However, the company’s strategy to focus on higher-margin subscribers and cut costs is helping it weather the storm. These efforts ensure BCE can maintain its dividend payouts despite the temporary hurdles.
BCE is well-positioned for long-term growth. Its vast service footprint, robust wireless network, and expanding fibre internet business are strong competitive advantages. The company is also focusing on cost-saving initiatives, enhancing its digital and artificial intelligence (AI) capabilities, and modernizing its tools and systems—moves that should drive efficiency and growth in the years to come.
Additionally, BCE’s revenue diversification strategy is paying off. Its digital platforms and advertising technology businesses are thriving, providing an extra boost to its financial performance.
BCE’s high yield and long-term growth potential make it an excellent choice for investors seeking reliable passive income.
