Investing for income doesn’t have to break the bank. You can start your journey with as little as $400 by focusing on high-quality dividend stocks. By consistently investing this amount into fundamentally strong stocks, you can gradually build a solid passive-income stream.
Against this background, let’s look at three top Canadian stocks that stand out for their high yields of over 7%. Besides high yields, these Canadian stocks offer a dependable dividend income.
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High-yield dividend stock #1
Investors seeking high yields can rely on SmartCentres REIT (TSX:SRU.UN). This real estate investment trust (REIT) pays a dividend of $0.154 per share every month, equating to a high yield of over 7.3%.
SmartCentres’s solid real estate portfolio, backed by core retail properties comprising grocery stores, adds stability to its financials, drives higher net operating income (NOI), and ensures consistent cash flow in all economic conditions. In addition, SmartCentres benefits from long-term leases, high occupancy rates, growing tenant demand, strong renewal rates, and higher rents. This enables the company to enhance its shareholder value through regular payouts.
Further, SmartCentres’s mixed-use development pipeline will diversify its income stream, drive profitability, and enhance long-term growth. Moreover, the REIT’s vast land bank provides a significant runway for growth, supporting its payouts.
High-yield dividend stock #2
Telus (TSX:T) is another attractive, high-yield dividend stock investors could buy to build a steady income stream. Canada’s leading wireless service provider has raised its dividend 27 times since 2011 and returned more than $21 billion in dividends to its shareholders since 2004. Further, it offers an impressive yield of about 7.9%.
Thanks to its growing earnings base, stellar dividend growth history, sustainable payout ratio, and high yield, Telus looks well-positioned to maintain its dividend growth.
The communication giant is focusing on expanding its user base profitably while maintaining a low churn rate. In addition, Telus will likely benefit from investing in its network, enhancing coverage and reliability through spectrum acquisitions and infrastructure upgrades. Telus’s focus on revenue diversification and expansion into digital services bodes well for future growth, supporting its future payouts.
High-yield dividend stock #3
Whitecap Resources (TSX:WCP) is a reliable, high-yield stock. This Canadian energy company pays a monthly dividend of $0.061 per share, translating into a solid yield of 8.5%.
It is worth noting that Whitecap has returned about $2.1 billion in cash as dividends to its shareholders since 2013. The company’s high-quality assets, growing production volumes, and efficient cost management drive its financials and support its durable payouts.
Whitecap will likely continue to return significant cash to its shareholders, given its ability to increase production consistently and funds flow per share. Further, its focus on expanding its asset base and drilling efficiencies will improve operational profitability and generate substantial free cash flow, driving higher payouts. In addition, Whitecap’s low-maintenance capital needs and focus on debt reduction will strengthen its balance sheet, positioning it well to capture growth opportunities and deliver sustainable earnings.
