Retirees and other dividend investors are searching for good stocks to add to their self-directed Tax-Free Savings Account (TFSA) focused on generating reliable and growing passive income.
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Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) is Canada’s largest energy company with a current market capitalization near $90 billion.
The stock is down about 18% in the past year, currently trading near $43 per share. It was as high as $53 at one point in the past 12 months. Weaker oil prices are to blame for the decline. West Texas Intermediate (WTI) oil trades for close to US$61 per barrel at the time of writing. It was above US$83 last summer.
Analysts broadly expect the oil market to face headwinds into 2026 due to weak demand from China and higher output from major producers, including the United States and Canada. A major geopolitical shock in the Middle East, however, could quickly change market conditions. Any news of a trade deal between the U.S. and China could also bring buyers back into energy stocks.
CNRL remains very profitable, even at current oil prices. The company is known for being an oil producer but also generates revenue through its large natural gas operations. Natural gas prices are higher right now than they were for most of last year and demand for natural gas is expected to rise in the coming years.
CNRL raised its dividend in each of the past 25 years. Investors who buy CNQ stock at the current price can get a dividend yield of 5.5%.
Enbridge
Enbridge (TSX:ENB) raised its dividend in each of the past 30 years. The energy infrastructure giant is one of Canada’s largest companies with a current market capitalization of $139 billion.
Enbridge has the financial firepower to make large strategic acquisitions to drive growth. The company spent US$14 billion in 2024 to acquire three natural gas utilities in the United States. The deals diversified Enbridge’s revenue stream and made the company the largest natural gas utility operator in North America.
Enbridge is working on a $28 billion capital program with annual investments expected to be $9 billion to $10 billion through 2026. This should provide an added boost to cash flow to support ongoing dividend growth. Enbridge is targeting adjusted earnings per share (EPS) growth of 4% through 2026. Distributable cash flow (DCF) is expected to rise by 3%. Beyond 2026, the company sees 5% annual increases for adjusted EPS and DCF.
Investors who buy ENB stock at the current level can get a dividend yield of 5.9%.
Enbridge’s share price is up 28% in the past year due in part to falling interest rates. Analysts broadly expect rates to continue to decline later this year and in 2026. Lower interest rates reduce debt expenses and free up more cash for dividends or debt reduction.
The bottom line on top stocks for passive income
CNRL and Enbridge pay attractive dividends that should continue to grow. If you have some cash to put to work in a self-directed TFSA portfolio focused on passive income, these stocks deserve to be on your radar.
