The Tax-Free Savings Account (TFSA) limit in 2025 is $7,000. With the TSX trading at a record high, investors are wondering which top Canadian dividend stocks might still be good to buy right now for a self-directed TFSA focused on income and total returns.
Fortis
Fortis (TSX:FTS) is a great dividend-growth stock that TFSA investors can own for decades. The company has increased the dividend in each of the past 51 years and intends to raise the distribution by 4% to 6% annually through at least 2029.
Fortis gets most of its revenue from rate-regulated businesses, including power generation facilities, electric transmission networks, and natural gas distribution utilities. This means cash flow tends to be reliable and predictable, even during challenging economic times.
Fortis grows through acquisitions and development projects. The current $26 billion capital program is expected to boost the rate base from $39 billion in 2024 to $53 billion in 2029. Revenue and earnings from the new assets should support the planned dividend growth. Investors who buy FTS stock at the current price can get a dividend yield of 3.75%.
Bank of Nova Scotia
Bank of Nova Scotia (TSX:BNS) trades near $74 at the time of writing. The stock is up about $10 in the past two months but is still down from the 12-month high of around $80 and well below the $93 it reached in early 2022.
The bank is working through a strategy shift that will focus growth investments on the United States and Canada instead of Latin America, where the bank has spent billions of dollars over the past 20 or 30 years. Investors have not enjoyed the anticipated benefits from betting on emerging markets. Bank of Nova Scotia’s share price has underperformed its large Canadian peers that targeted growth in the U.S. and other markets.
Bank of Nova Scotia spent US$2.8 billion in 2024 to buy a 14.9% stake in KeyCorp, an American regional bank. The deal gives Bank of Nova Scotia a platform to expand its U.S. presence. Earlier this year, the bank sold its operations in Colombia, Panama, and Costa Rica as part of the transition.
It will take some time for the turnaround efforts to deliver results, but contrarian investors get paid a solid 5.9% dividend yield on the stock right now while they wait.
Enbridge
Enbridge (TSX:ENB) spent US$14 billion in 2024 to acquire three American natural gas utilities. The deals made Enbridge the largest natural gas utilities operator in North America. These assets, combined with Enbridge’s existing natural gas transmission and storage infrastructure, place the company in a good position to benefit from anticipated growth in natural gas demand as more gas-fired power facilities are built to supply electricity for artificial intelligence data centres.
Enbridge raised the dividend in each of the past 30 years. Investors who buy ENB stock at the current price can get a dividend yield near 6%.
The bottom line
Fortis, Bank of Nova, and Enbridge pay attractive dividends that should continue to grow. If you have some cash to put to work in a TFSA, these stocks deserve to be on your radar.
