Best Dividend Stocks to Buy Now for Canadian Investors

These two dividend stocks have reliable operations and are consistently growing their businesses, making them some of the best to buy now.

Daniel Da Costa ❯

Daniel joined the Motley Fool Canada team in 2019 with years of experience in banking and investing. Growing up the son of a proprietary stock trader and educator, Daniel’s always found joy in helping Canadians to improve their financial situations. With the Motley Fool, Daniel sees an even more rewarding way to impact Canadians positively. A student and great admirer of Warren Buffett, he’s always looking for investments offering growth at a reasonable price. Outside of finance, Daniel enjoys spending his time with family, sailing, and watching Formula One.

Published December 31, 2024 8:00 pm EST

There’s no question that dividend stocks are some of the best investments to buy for those seeking reliable passive income and long-term growth.

In Canada, the market offers a tonne of high-quality companies that pay dividends, making it easier for investors to find opportunities that align with their goals. However, selecting the right stocks requires a focus on businesses with strong fundamentals and the ability to consistently generate cash flow.

As interest rates continue to decline, dividend stocks are particularly appealing. Lower rates often improve market sentiment, reduce the cost of debt, and drive down dividend yields, pushing stock prices higher. This creates an ideal environment for Canadian investors to identify the best dividend stocks to buy now.

So, if you’ve got cash that you’re looking to put to work, here are two standout dividend stocks – each backed by a reliable and growth-oriented business model – that offer significant opportunities today.

One of the very best dividend stocks in Canada to buy now and hold for years

Although it offers a dividend yield of just 1.3% today, significantly less than many other high-quality Canadian dividend stocks, Thomson Reuters (TSX:TRI), the massive $104 billion media company, has to be considered one of the best dividend stocks that Canadian investors can buy.

In fact, over the last decade, it has earned investors a total return of 519%, or a compound annual growth rate of 20%.

Thomson Reuters is a name many Canadians should be familiar with, but its business is far more than just a media company.

The stock specializes in providing data, software, and professional services to industries such as law, finance, and accounting. These sectors rely heavily on the company’s products to operate efficiently, making Thomson Reuters’ revenue streams highly reliable.

In addition, one of the most important reasons why Thomson Reuters is one of the best dividend stocks to buy now is its subscription-based model.

With the majority of its revenue coming from recurring subscriptions, the company generates consistent cash flow even in times of economic uncertainty. This stability is a critical factor in its ability to pay regular dividends to shareholders.

Furthermore, as businesses increasingly adopt digital tools and advanced analytics, Thomson Reuters is poised to benefit. The company continues to invest in innovative technology, ensuring it maintains its competitive edge and solidifies its leadership position in the market.

Therefore, Thomson Reuters stands out not only for its strong business model but also for its commitment to rewarding shareholders. Its history of paying dividends, not to mention its consistent increases to the dividend, makes it a no-brainer investment for any dividend-focused portfolio.

A diversified industrial real estate stock

In addition to Thomson Reuters, another of the best dividend stocks in Canada to buy right now is Granite REIT (TSX:GRT.UN).

As one of Canada’s leading industrial REITs, Granite owns properties such as warehouses and distribution centres. Therefore, with the rise of e-commerce fueling demand for these assets, Granite has a tonne of long-term growth potential.

This steady demand allows the REIT to generate significant rental income, which in turn supports its reliable dividend payouts.

Furthermore, another reason why Granite is one of the best dividend stocks to buy now is its geographic diversification. While the REIT has a strong presence in Canada, it also owns properties across the United States and Europe.

This global reach not only reduces reliance on any single market but also provides access to growth opportunities in multiple regions.

Plus, in addition to its organic growth potential as the popularity of e-commerce continues to grow, Granite also has the potential to grow its operations through strategic acquisitions and the expansion of its property portfolio.

In fact, analysts estimate that its revenue will grow by more than 8% this year, and its funds from operations are expected to climb by more than 6%. That would mark the seventh straight year when its sales and funds from operations both increased.

So, if you’re looking for some of the best dividend stocks to buy now, Granite not only offers a current yield of 4.9%, but it’s also consistently increasing the cash it returns to investors, making it one of the best passive income-generating stocks to invest in today.