When you’re building a long-term portfolio designed to generate passive income, there are a few things that matter most. You want stocks that offer attractive yields, reliable businesses that continue to generate strong cash flow, and, above all, dividends that are sustainable and ideally increasing over time.
That’s why the very best long-term investments aren’t just high-yield dividend stocks but companies with a track record of consistently paying and often raising their payouts year after year. These businesses tend to be more resilient, better capitalized, and more efficient in how they allocate capital, all while rewarding shareholders along the way.
If you can build a well-diversified portfolio of these high-quality dividend stocks, not only can you help protect your capital through all types of economic environments, but you’ll also put yourself in the best position to compound that capital efficiently over the long haul.
So, if you’re looking to boost the passive income your portfolio is generating with stocks you can trust, here are three of the best Canadian dividend stocks to consider today.
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A top Canadian energy stock
There are numerous high-quality dividend stocks in the energy sector that can generate significant passive income for investors. However, one of the very best is TC Energy (TSX: TRP).
TC Energy is one of the largest energy infrastructure companies in North America. It owns and operates a massive network of natural gas pipelines, power generation assets, and other critical energy infrastructure.
These are long-life assets backed by long-term contracts that provide dependable cash flow regardless of the economic environment. That’s what makes it such a dependable dividend stock.
Right now, TC Energy currently offers a dividend yield north of roughly 4.9%. However, in addition to the attractive yield it offers, TC Energy is also consistently expanding its operations, increasing the cash flow it generates and, therefore, constantly increasing its dividend each year. In fact, TC Energy has increased its dividend every year for more than two decades now.
So, if you’re looking for the best dividend stocks in Canada to buy that will boost the passive income your portfolio generates, there’s no question TC Energy should be a top choice.
One of the best Canadian bank stocks for passive-income seekers
When it comes to the financial sector, all the big banks are high-quality dividend stocks. However, one of the best is Bank of Nova Scotia (TSX: BNS), especially while its yield sits at roughly 6.2%.
Furthermore, in addition to the exceptional yield that Scotiabank offers, it’s also increased its dividend every year for more than a decade now.
That goes to show the quality of stock that Scotiabank is. Even through several different economic environments over the last decade, Scotiabank has continued to generate a profit and increase the cash it’s returning to investors.
Although it’s faced some short-term headwinds recently, including slowing loan growth and tighter net interest margins, it remains one of the most reliable dividend stocks in the country. And with a low payout ratio and strong capital base, that dividend looks as safe as ever.
For example, in 2024, Scotiabank generated normalized earnings per share (EPS) of $6.47 and paid out just $4.24 in dividends per share, giving it a payout ratio of just 68%. And this year, analysts estimate its normalized EPS will increase by over 6%.
So, if you’re looking for high-quality dividend stocks to boost your passive income, Scotiabank is one of the top investments to consider today.
A top defensive growth stock
Finally, one of the best Canadian stocks to buy now, both for the passive income it generates and the long-term growth potential it offers, is Brookfield Infrastructure Partners (TSX: BIP.UN).
What makes Brookfield such a high-quality investment is that it offers investors diversified exposure to a global portfolio of essential infrastructure assets.
Brookfield owns assets across the utilities, transport, midstream, and data infrastructure sectors spread out all over the world. These are assets that people rely on regardless of the economic environment.
That allows it to earn consistent, predictable cash flow, which, in turn, allows it to continue increasing the dividend each year.
Today, Brookfield’s dividend yield sits at more than 6.1%, which is why it’s one of the best Canadian stocks to buy for passive income.
