This Under-$20 Stock Yields 4% and Has Remarkable Dividend Safety

Reliable income doesn’t have to come with risk, especially if you know where to look. In every market cycle, some fundamentally solid stocks continue to thrive through change, reward shareholders consistently, and maintain financial stability. For long-term Foolish Investors, owning even a few of these dividend stocks could help build a strong and stable portfolio over time. While many dividend stocks are overvalued in 2025, there are still a few that offer both value and long-term safety.

In this article, I’ll highlight one of my favourite dividend picks on the TSX — a company with excellent fundamentals, a well-supported dividend, and, best of all, a 4% yield at a share price under $20.

A reliable dividend stock backed by a strong backlog

That leads me to a solid dividend pick under $20 per share, Aecon Group (TSX: ARE), as it ticks all the boxes for dividend safety, stable operations, and long-term potential.

It’s one of Canada’s top construction and infrastructure firms based out of Toronto. The company works across civil, nuclear, utilities, industrial, and urban transportation sectors, handling some of the country’s largest public and private projects.

After rallying by 16.4% over the last year, ARE stock currently trades at $19.20 per share, offering an annualized dividend yield of nearly 4%, paid quarterly. Aecon’s market cap sits at $1.2 billion. These gains in ARE stock could mainly be attributed to positive developments around its project backlog and improving visibility into its future earnings potential. Let’s take a closer look.

Growing revenue despite short-term headwinds

Aecon’s revenue in the first quarter of 2025 jumped by 25% YoY (year over year) to $1.06 billion. This big revenue jump mainly came from multiple segments, especially from its nuclear, industrial, and utilities operations.

Yes, the company did report a net loss for the quarter, mainly due to a fixed-price legacy project. But that project is nearly finished, and its management sees the earnings pressure easing in the coming quarters. Even with that temporary hit, Aecon has kept its dividend policy unchanged, highlighting its focus on maintaining dividend safety.

And if you look at the trailing twelve-month numbers, Aecon’s total revenue rose slightly on a YoY basis. Its backlog, however, tells a much stronger story.

Record backlog and focus on strategic projects

What gives Aecon the label of a reliable dividend stock is not just its history of payouts but its future earnings visibility. At the end of the first quarter, Aecon reported a 54% YoY surge in its backlog to $9.7 billion — the highest in the company’s history. Interestingly, its new projects like the Scarborough Subway Extension and a major nuclear refurbishment contract added billions to this backlog.

In addition, Aecon is part of several long-term infrastructure and energy projects using collaborative and progressive design models, which are likely to reduce its risk and improve profitability over time.

As demand for energy infrastructure, transit, and environmental projects continues to grow, Aecon’s financial growth could accelerate — making it a reliable dividend stock with real staying power.