Canadian retirees and other income investors are searching for good TSX dividend stocks to add their self-directed Tax-Free Savings Account (TFSA) focused on generating high-yield passive income.
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Bank of Nova Scotia
Bank of Nova Scotia (TSX:BNS) is down 12% in 2025. The pullback gives investors who missed the big rally last fall a chance to buy the stock at an attractive price.
Bank of Nova Scotia is shifting its growth investments away from Latin America, where the bank spent billions of dollars over the past 20 to 30 years to to buy banks and credit card portfolios in Mexico, Colombia, Peru, Chile, and other smaller markets.
Earlier this year, Bank of Nova Scotia sold its businesses in Colombia, Panama, and Costa Rica. The bank booked a loss on the sale, which is one reason the stock might be under pressure this year. Investors could be concerned that additional monetization will lead to more charges.
On the positive side, Bank of Nova Scotia’s US$2.8 billion purchase of a 14.9% stake in KeyCorp, an American regional bank, is expected to contribute more than $70 million in earnings for the bank in the latest quarter. The stake in KeyCorp gives Bank of Nova Scotia a platform to expand its U.S. presence as part of the new growth strategy.
Investors will need to be patient for the turnaround process to deliver meaningful results, but you get paid a solid 6.2% dividend yield right now to wait for the recovery. Bank of Nova Scotia trades near $68 per share at the time of writing. The stock was as high as $93 in early 2022.
Enbridge
Enbridge (TSX:ENB) is much further along in its strategy transition. The energy infrastructure giant spent the past few years diversifying its assets to take advantage of changing conditions in the energy market. Enbridge purchased an oil export terminal in Texas and took a stake in the Woodfibre liquified natural gas (LNG) export facility being built in British Columbia. Exports of oil and natural gas are expected to rise in the coming years as international buyers seek out reliable supplies from stable producers.
In the domestic market, Enbridge spent US$14 billion in 2024 to buy three natural gas utilities in the United States. The deal made Enbridge the largest natural gas utility company in North America. These assets, combined with the existing natural gas transmission network, position Enbridge to benefit from expected demand growth for natural gas as new gas-fired power facilities are built to provide electricity to artificial intelligence data centres.
Enbridge is working on a $26 billion capital program to drive growth in revenue and cash flow. This should support steady dividend increases. Enbridge raised the dividend in each of the past 30 years. Investors who buy ENB stock at the current level can get a dividend yield of 5.9%.
The bottom line on high-yield stocks for TFSA passive income
Bank of Nova Scotia and Enbridge pay attractive dividends that should continue to grow. If you have some cash to put to work in a TFSA focused on passive income, these stocks deserve to be on your radar.
