Invest $20,000 in 2 TSX Stocks for $945.96 in Passive Income

Put aside $20,000, and suddenly you can have almost another $1,000 to put in your pocket.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published March 5, 2025 4:10 pm EST

| More on: LUNNPI

Investing $20,000 in two TSX mid-cap stocks can feel a bit overwhelming. But when it comes to TSX stocks like Northland Power (TSX:NPI) and Lundin Mining (TSX:LUN), it can be a savvy strategy to generate passive income. Let’s explore how these companies have been performing and what the future might hold for investors.

Man holds Canadian dollars in differing amounts — Source: Getty Images

Northland Power

Northland Power, a prominent player in the renewable energy sector, has been making waves with its recent financial performance. In the fourth quarter (Q$) of 2024, the TSX stock reported revenue from energy sales of $572 million — a slight decrease from $626 million in the same period the previous year. However, on a full-year basis, revenue increased to $2,346 million from $2,233 million in 2023. Net income also saw a positive shift, rising to $150 million in Q4 2024 from a net loss of $268 million in Q4 2023.

Looking ahead, Northland Power has issued its 2025 financial guidance. It expects adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to be in the range of $1.3 to $1.4 billion. This optimistic outlook is bolstered by ongoing projects in Poland, Taiwan, and Canada, which are anticipated to start contributing to earnings in 2025, with full realization by 2027.

For dividend enthusiasts, Northland Power offers a forward annual dividend rate of $1.20 per share, translating to a yield of approximately 6.18% at writing. This robust dividend yield is higher than the average of the bottom 25% of dividend payers in the Canadian market, making it an attractive option for income-focused investors.

Lundin Mining

Lundin Mining, a diversified base metals mining company, has also shown noteworthy performance. In Q4 2024, the TSX stock achieved revenue of $1.024 billion, with net earnings attributable to shareholders amounting to $101.2 million. This reflects a significant turnaround from a net loss in the same quarter of the previous year.

The TSX stock’s full-year results for 2024 are equally impressive, with revenue reaching $4.117 billion and record copper production of 369,067 tonnes. These figures underscore Lundin Mining’s operational efficiency and strong market position.

For investors eyeing dividends, Lundin Mining offers a forward annual dividend rate of $0.36 per share, yielding approximately 3.11%. While this yield is modest compared to Northland Power, it still provides a steady income stream for shareholders.

Earning income

By allocating $10,000 to Northland Power and $10,000 to Lundin Mining, investors can diversify their portfolios across the renewable energy and mining sectors. Based on the current dividend yields, this investment could generate significant income, as you can see below.

COMPANY	RECENT PRICE	NUMBER OF SHARES	DIVIDEND	TOTAL PAYOUT	FREQUENCY	TOTAL INVESTMENT
NPI	$19.10	524	$1.20	$628.80	monthly	$10,000
LUN	$11.35	881	$0.36	$317.16	quarterly	$10,000

You would be earning $945.96 annually! Of course, it’s essential to consider that dividend yields are subject to change based on company performance and market conditions. However, both Northland Power and Lundin Mining have demonstrated resilience and growth potential, making them viable options for investors seeking passive income.

Foolish takeaway

Northland Power’s strategic projects in renewable energy are expected to enhance its earnings in the coming years. The TSX stock’s focus on sustainable energy solutions aligns with global trends toward cleaner energy sources, potentially leading to increased profitability and, consequently, higher dividends.

Similarly, Lundin Mining’s robust production figures and financial health position it well for future growth. As demand for base metals continues to rise, the company is poised to capitalize on market opportunities. This could translate into enhanced shareholder value.

Investing in Northland Power and Lundin Mining offers a balanced approach to generating passive income through dividends. Both TSX stocks showcased strong financial performances and have promising outlooks, making these worthy considerations for investors aiming to build a resilient and income-generating portfolio.