As 2025 begins, TSX investors are facing an interesting mix of optimism and caution. On one hand, inflation is easing, and interest rate cuts seem on the horizon. On the other, global trade tensions and geopolitical uncertainties are raising concerns. In this environment, dividend stocks could be an excellent choice to stabilize your portfolio and generate income.
And what if I say you can expect to earn stable dividend income without compromising on the prospects of long-term capital gains? Actually, it’s possible to achieve both by investing in top Canadian dividend stocks with strong fundamentals and a history of navigating uncertain market conditions. In this article, I’ll talk about two such dividend stars that, in my opinion, are the best stocks to buy in 2025.
TC Energy stock
After having soared by 46% over the last year, TC Energy (TSX:TRP) stock currently trades at $69.18 per share with a market cap of $70.9 billion. At this market price, it has a 4.8% annualized dividend yield and distributes these payouts every quarter.
In October last year, TC Energy spun off its Liquids Pipelines business into a separate entity named South Bow. This strategic move was the result of a thorough multi-year evaluation to streamline TC Energy’s operations and increase its focus on its natural gas, storage, and power and energy solutions segments.
This strategic refocus has already started to pay dividends, literally and figuratively. With a quarterly dividend of $0.8225 per share and a clear commitment to long-term shareholder returns, TC Energy’s ability to deliver consistent payouts remains intact after the South Bow spinoff. Furthermore, the company’s robust natural gas pipeline network in Canada, the U.S., and Mexico is likely to benefit from rising demand for energy infrastructure.
In the first nine months of 2024, TC Energy’s segmented earnings surged by 81% YoY (year over year) with its focus on operational excellence and disciplined project execution. With its major projects like the Southeast Gateway natural gas pipeline progressing ahead of schedule and under budget, TRP could sustain its growth momentum in 2025 and beyond.
Brookfield Asset Management stock
Just like TRP stock, Brookfield Asset Management’s (TSX:BAM) shares have delivered a strong 52% return over the last year. With a robust $35.7 billion market cap and a current trading price of $79.96 per share, BAM offers stability backed by diversified strategies across renewable energy, infrastructure, private equity, and real estate. Despite its modest 2.7% annualized dividend yield, the company’s strong fee-related earnings growth makes it a top TSX stock to consider today.
In the latest quarter, BAM’s fee-related profits climbed 14% YoY to US$644 million, driven by a $100 billion surge in its fee-bearing capital, which now stands at US$539 billion.
Moreover, its continued strategic expansions, including partnerships in private credit and acquisitions in India, are expected to boost its long-term growth prospects. While its dividend is modest, BAM’s long-term focus on scaling renewable energy and private credit makes it a resilient stock to buy for income-seeking investors in 2025, especially if they can hold it for the long term.
