Reliable monthly income is the dream for many investors, especially when it comes without having to sell any shares. That’s where a high-yield dividend stock like Yellow Pages (TSX: Y) can shine. Often overlooked, this dividend stock quietly offers one of the most attractive dividend yields on the TSX today, paying investors cash every single month. With a near double-digit yield and a sustainable payout backed by solid financials, it’s worth a closer look for passive income.
Beyond the book
Yellow Pages isn’t the marketing powerhouse it once was during the phone book era. But it has pivoted well to a digital-first strategy, helping small- and medium-sized businesses with online advertising, website creation, SEO, and customer engagement. It’s a niche market, but it’s sticky, with many customers relying on the company’s tools to bring in business. While the business is no longer growing at a fast clip, it’s throwing off a lot of cash. And that’s key for dividend investors.
As of writing, Yellow Pages pays a quarterly dividend of $0.25 per share. That adds up to $1.00 annually, and with the dividend stock recently trading around $10.12, the dividend yield sits at an eye-catching 9.9%. That’s one of the highest yields on the TSX right now, particularly among companies still turning a profit and maintaining positive cash flow. Importantly, this isn’t a new payout. Yellow Pages has steadily increased its dividend from $0.15 per share in 2023 to the current level, reflecting management’s confidence in its ongoing ability to generate income and reward shareholders.
Can it continue?
What about sustainability? No investor wants to chase yield just to see the payout disappear a few quarters later. Fortunately, Yellow Pages keeps a tight lid on its payout ratio. The dividend stock earned $1.84 per share in 2024, meaning it’s only paying out about 54% of its earnings. That’s a healthy range, leaving room to cover the dividend while still reinvesting in operations, funding strategic initiatives, and preserving flexibility.
Speaking of financial strength, Yellow Pages is sitting on a solid cash reserve. As of the end of January 2025, it held around $49 million in cash and had virtually no debt. That strong balance sheet gives it breathing room to manage through challenges and continue rewarding shareholders, even if earnings hit a bump. Free cash flow, the fuel behind dividends, remains healthy and stable.
Considerations
Of course, this isn’t a perfect growth story. Yellow Pages is still seeing some revenue pressure. In its most recent quarterly report for Q4 2024, revenue came in at $51.4 million, down 8.1% from the same quarter the previous year. That decline was largely driven by falling sales in both digital media and legacy print advertising, which still makes up a small but fading part of the business. But despite this, the dividend stock remained profitable, posting net income of $2.7 million for the quarter.
What’s interesting is how Yellow Pages is managing the transition. Rather than chasing unprofitable growth or splurging on costly acquisitions, it has focused on customer retention and improving its digital product suite. New customer acquisitions rose 6% in the fourth quarter of 2024 compared to the previous year, and the company has streamlined operations to maintain strong margins. While it’s not on a hyper-growth path, it’s a steady operator that knows its lane, and knows how to keep costs under control.
Bottom line
All of this makes Yellow Pages an appealing choice for investors who care more about cash flow than flashy headlines. The nearly 10% dividend yield means that a $10,000 investment could generate around $1,000 per year in income. For those building a passive income stream, especially in retirement or semi-retirement, that kind of return is difficult to ignore.
At the end of the day, Yellow Pages isn’t aiming to be the next big tech stock. But what it does offer is rare: high, predictable income from a company with solid financials, a responsible payout, and a clear focus on rewarding shareholders. For investors looking to add a steady paycheque to their portfolio every month, Yellow Pages might be worth flipping to the top of the stack.
