Investors looking for relatively safe income in 2025 and beyond could add top Canadian dividend stocks with high and sustainable yields. Notably, the distributions of these Canadian stocks are supported by their solid fundamentals and a growing earnings base, making them a reliable investment to generate worry-free passive income.
Against this background, here are three safe dividend stocks offering ultra-high yields of over 7%.
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Telus
Telus (TSX: T) is one of the most reliable Canadian stocks for investors seeking ultra-high dividend yields. This Canadian communication services provider is known for consistently growing dividends, thanks to its ability to generate profitable growth and solid free cash flows. Also, Telus stock offers a high yield of over 8%, which is near the current market price.
The company has returned over $21 billion in dividends since 2004 and increased its dividend 27 times since 2011, reflecting the resilience of its payouts in all market conditions. Under its dividend growth program, the company plans to grow its future dividends by 7-10%, making it a dependable source of increasing passive income for investors. Its payout ratio of 60-75% of free cash flow is also sustainable in the long term.
The telecom giant’s future payouts will be supported by its growing earnings, solid subscriber base, strong retention rates, and focus on cost efficiency. Further, Telus is focused on improving its cost-to-serve and driving higher margins per user, which will likely drive continued profitability.
The company’s mobile network expansion and increase in residential internet, TV, and security subscribers will likely boost its top line. Further, the company’s strategic efforts to monetize its assets and the ongoing momentum in the health services division are expected to support its bottom line and future payouts.
Firm Capital Mortgage Investment Corporation
Investors could consider investing in Firm Capital Mortgage Investment Corporation (TSX: FC) stock for its ultra-high yield. Firm Capital specializes in short-term real estate mortgage loans targeting residential and commercial customers. It also provides loan servicing, asset management, and investment-related services. This non-bank lender pays a monthly dividend of $0.078 per share and offers an attractive yield of about 7.9%.
Firm Capital Mortgage Investment’s diversified portfolio, focus on short-term financing, conservative lending approach, strong underwriting capabilities, and solid risk management practices position it well to generate solid earnings across all market conditions, supporting its monthly dividend payouts.
Further, the company’s strategy to invest in debt and equity across Canada’s private and public real estate markets can generate solid interest, fees, and income, enabling higher dividend payments.
SmartCentres Real Estate Investment Trust
Another high-yield stock worth considering is SmartCentres Real Estate Investment Trust (TSX: SRU.UN). This REIT offers a consistent monthly dividend of $0.154 per share and a high yield of 7.4%. Notably, the company has maintained its distributions regardless of economic conditions, which reflects its ability to generate strong financials and management’s commitment to reward its shareholders. Its resilient payouts make it one of the top stocks for generating recurring passive income.
SmartCentres REIT benefits from a defensive real estate portfolio and its strategically located properties in high-traffic areas. The company witnesses solid lease demand for its properties and consistently sports a high occupancy rate. Further, increasing renewal rates, higher rental growth, and robust cash collections augur well for future same-property net operating income.
The company’s management expects the occupancy rate to remain high in the coming quarters, led by tenant demand for more locations. Meanwhile, the strong performance of its core retail business and continued expansion into a mixed-use development portfolio will continue to generate high-quality income across all provinces and support its future monthly dividend payments. Also, SmartCentres REIT’s extensive land bank provides a solid base for future growth.
