Want to build out a handsome dividend-earning portfolio? There’s no shortage of great stocks on the market that can generate a growing source of reliable dividends.
Here’s a look at a trio of options I would invest in given $12,000 today.
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Step 1 – Drop $5,000 into this bank stock
It’s hard to mention reliable dividends and not mention Canada’s big bank stocks. Bank of Nova Scotia (TSX: BNS) represents an option that should be on the radar of investors everywhere.
The big banks generate a healthy recurring revenue stream from domestic operations in Canada. That market is well-regulated, mature, and provides a stable baseline. This leaves international markets as the main growth-driver.
Turning to its international presence, Scotiabank is known as Canada’s most international bank. That label comes thanks to Scotiabank’s presence in a swath of international markets.
That exposure, particularly in Latin America, has allowed Scotiabank to realize stellar growth over the years.
More recently, Scotiabank has started to shift that growth focus to the U.S. market, where it is less volatile yet can still provide significant growth potential. More importantly, that growth can continue to feed Scotiabank’s juicy quarterly dividend.
That dividend currently pays out a generous 6.4% yield, making it a top contender for any well-diversified portfolio.
Step 2 – Invest $4,000 into this high-yield gem
Another great option for investors to consider is Enbridge (TSX: ENB). Enbridge is an energy-infrastructure behemoth, with its tentacles embedded into multiple segments of the market.
This includes operating a renewable energy portfolio of dozens of hydro, solar, and wind facilities across Europe and North America. That portfolio generates a recurring revenue stream that leaves room for growth, investment, and dividend payouts.
The company also benefits from operating one of the largest natural gas utilities in North America. Like the renewable arm, this too is regulated and provides a recurring, stable source of revenue.
Perhaps best of all is Enbridge’s lucrative pipeline business. That business, which includes both natural gas and crude segments, connects oil-rich regions and refineries across North America.
Enbridge charges for use of that network, generating a toll-booth like income that is priced independent of the price of oil.
The end result is a healthy revenue stream that is highly defensive and helps to fund one of the best dividends on the market. As of the time of writing, that dividend pays a juicy 6.1% yield.
Step 3 – Turbocharge your income with $3,000 in this telecom
One final option for investors seeking reliable dividends is to invest in BCE (TSX: BCE). BCE is one of the largest telecoms in Canada and represents a defensive play in this volatile market.
BCE’s core subscription services include TV, Internet, wireline, and wireless segments. These provide a stable, if not a growing source of revenue for the company. Additionally, concerns over BCE’s debt in recent years have pushed the stock lower, pushing it into discount territory.
In fact, as of the time of writing, BCE’s stock trades down 35% over the trailing 12-month period. Fortunately, the telecom has worked hard to bring down costs over the past year and has also invested into longer-term growth through its Ziply acquisition.
Turning to dividends, BCE offers an insane 12.3% yield, which is elevated due to that steep drop in the stock price. As part of the cost-cutting measures taken, BCE announced a halt to its annual dividend increase, but so far has not slashed that dividend.
Investors: Reliable dividends await!
All stocks carry risk, and that even includes defensive options like the trio mentioned above. Fortunately, the defensive appeal that the above stocks offer does offset some of that risk.
More importantly, a $12,000 investment across those three stocks can provide a juicy income of just over $1,000. That’s not enough to retire on, but it is enough to generate a handful of shares through reinvestments. This makes the above stocks great buy-and-forget stocks for any portfolio.
Here’s how that juicy income pans out, given the allocation of $12,000 mentioned above:
| Company | Recent Price | No. of Shares | Dividend | Total Payout | Frequency |
| Bank of Nova Scotia | $62.87 | 79 | $4.24 | $334.96 | Quarterly |
| Enbridge | $57.08 | 70 | $3.77 | $263.90 | Quarterly |
| BCE | $29.59 | 101 | $3.99 | $402.99 | Quarterly |
