When recession fears start creeping into the market, dividend stocks often become the backbone of a defensive portfolio. With global trade tensions lingering and central banks still cautious, the macroeconomic environment remains fragile. That’s why now may be the perfect time to consider which Canadian stocks can weather the storm and still deliver income you can count on.
In this article, I’ll highlight three safe dividend stocks I’d hold without hesitation through a recession, as they have the ability to perform well even when the economy faces temporary challenges.
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Canadian Utilities stock
The first Canadian company that deserves a spot in any list of safe dividend stocks is Canadian Utilities (TSX:CU). This Calgary-based utility giant delivers electricity and natural gas through its ATCO Energy Systems and ATCO Australia segments. Trading at $37.74 per share with a market cap of $7.7 billion, CU stock also offers a strong annualized dividend yield of 4.9%, paid quarterly.
In the first quarter of 2025, CU’s adjusted earnings rose 2.4% YoY (year over year) to $0.85 per share. Similarly, its adjusted quarterly EBITDA (earnings before interest, taxes, depreciation, and amortization) remained nearly flat at $599 million but improved 17% sequentially with the help of strong natural gas storage performance and the company’s focus on cost discipline.
With projects like the Yellowhead Pipeline and Central East Transfer-Out in motion, Canadian Utilities is strengthening its long-term infrastructure footprint, which supports its ability to maintain reliable dividend payments. For income-seeking investors, this focus on essential services and regulated growth makes CU stock a reliable pick when building a recession-resistant portfolio.
Fortis stock
Another solid TSX-listed company that fits right into this list of safe dividend stocks is Fortis (TSX:FTS). This utility operator manages regulated electric and gas operations across North America. Trading at $66.16 per share with a market cap of $33.2 billion, Fortis offers a quarterly dividend with an annualized yield of about 3.7%.
In the first quarter, it posted a 7.5% YoY jump in its adjusted earnings to $1.00 per share due mainly to strong rate base growth and favourable currency exchange rates. Meanwhile, the company’s adjusted quarterly EBITDA climbed 10.9% from a year ago as its capital program continued at full pace.
Notably, Fortis has a $26 billion capital plan through 2029 and expects its growing rate base to support steady earnings and 4% to 6% dividend hikes each year. For investors seeking safe dividend stocks, FTS could be a great choice.
Manulife Financial stock
The third dividend stock I’d consider for a recession-resistant portfolio is Manulife Financial (TSX:MFC) — one of the largest life and health insurers in Canada. Trading at $42.94 per share with a market cap of $73.5 billion, it pays a quarterly dividend that works out to an annualized yield of just over 4%.
In the March quarter, Manulife’s adjusted earnings rose 3% YoY to $0.99 per share due partly to the strong performance of its global wealth and asset management segment. However, the company’s net profit dropped to $485 million due to losses from a reinsurance transaction and lower returns on some investments.
On the growth front, Manulife is investing in artificial intelligence-powered tools, expanding partnerships in Asia, and launching new health-focused insurance products. With stable earnings, essential services, and a reliable dividend, it’s easy to see why MFC stock fits well among safe dividend stocks.
