There’s no shortage of great Canadian stocks for dividend income investors to consider right now. In fact, many of those stocks now trade at a decent discount.
Here’s how I’d invest my $7,000 TFSA contribution into these Canadian stocks for dividend income.
Source: Getty Images
Buy Enbridge and enjoy a juicy income
One of the best long-term Canadian stocks for dividend income to consider is Enbridge (TSX:ENB). Enbridge is an energy infrastructure behemoth with multiple interests across the segment.
That includes a growing renewable energy operation, a natural gas utility, and its lucrative pipeline business.
The pipeline business generates the bulk of Enbridge’s revenue, leaving room for growth initiatives and a tasty dividend. Part of the reason for that is because the pipeline business, which contains both crude and natural gas parts, transports huge amounts of both.
In fact, Enbridge hauls so much crude and natural gas that the stock is seen as a defensive asset for investors.
As impressive as that sounds, the real reason why Enbridge is a superb pick among Canadian stocks for dividend income comes down to that income potential.
Enbridge’s quarterly dividend currently pays out an insane 6.3% yield, making it one of the best-paying options on the market. Adding to that appeal is that Enbridge has provided annual upticks to that dividend for three decades without fail.
Consider TD Bank for long-term income and growth
I would be remiss if I didn’t mention at least one of Canada’s big bank stocks as some of the best Canadian stocks for dividend income.
And among those big banks, Toronto-Dominion Bank (TSX:TD) represents an intriguing option for investors.
TD Bank is the second-largest of the big banks, with an impressive branch portfolio that blankets Canada and the U.S. East Coast. In the U.S., TD’s presence spans from Maine to Florida, fueling the bank’s current growth focus.
One of the many reasons why TD is a great pick comes down to the duality of its Canadian and U.S. operations.
In Canada, the bank has exposure to a well-regulated and mature market that generates a reliable revenue stream. Turning to the U.S., the bank augments that conservative stability with a focus on growth.
Throw in a tasty quarterly dividend, and you have a stellar investment option for anyone seeking Canadian stocks for dividend income.
As of the time of writing, TD’s quarterly dividend pays out an impressive 5.2% yield.
Buy Fortis for stable income
One final option for investors looking at Canadian stocks for dividend income is Fortis (TSX:FTS).
As a utility stock, Fortis generates a reliable and recurring revenue stream that leaves room for both growth and a recurring quarterly dividend.
As of the time of writing, the yield on that dividend works out to a respectable 3.8%. Adding to that appealing income potential is the fact that Fortis has provided investors with annual upticks to that dividend for over 50 consecutive years without fail.
That may be reason enough for investors to consider adding Fortis as one of the Canadian stocks for dividend income, but there’s still more.
Utilities generate that recurring revenue stream thanks to the stable business model that they adhere to. In short, utility service is a necessity that cannot be traded down like discretionary retail during times of market volatility.
That defensive appeal is a key reason why, during volatile times, investors flock to utility stocks like Fortis.
Invest in these Canadian Stocks for dividend income
All three of the above stocks can provide investors with a healthy, growing income stream.
Here’s how investors can generate nearly $350 in recurring income by investing in those Canadian stocks for dividend income.
| Company | Recent Price | No. of Shares | Dividend | Total Payout | Frequency |
| Enbridge | $60.51 | 41 | $3.77 | $154.57 | Quarterly |
| TD Bank | $82.07 | 24 | $4.20 | $100.80 | Quarterly |
| Fortis | $65.03 | 38 | $2.46 | $93.48 | Quarterly |
Prospective investors should note that the objective in starting this limited investment of $7,000 is not retirement income just yet, but rather to begin an investment cadence that will generate a growing source of income through reinvestments over time.
Specifically, the investments above will generate a few shares of each stock in the first year.
In other words, buy them, hold them, and watch your future income grow.
