With the Canadian stock market surging nearly 22% over the past year and trading near all-time highs, it is becoming harder to uncover high-quality stocks that are still trading at a discount, especially those offering attractive, sustainable dividends. But that’s exactly what makes this opportunity so compelling. While many stocks are climbing, one top-notch Canadian company has seen its share price fall sharply — yet its fundamentals and dividend-growth story remain intact.
Let’s dive into TFI International (TSX:TFII), a transportation and logistics giant that’s down 38% from its 52-week high. For long-term investors looking to lock in “fast dividends” with the potential for powerful total returns, this could be the perfect moment to act.
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Why you might consider TFI International
Despite its recent pullback, TFI International is no slouch. The trucking company boasts a strong track record of growing dividends — even through challenging economic cycles. Its last dividend increase in December 2024 was a hefty 12.5%, continuing a trend that has seen its dividend climb at a 10-year compound annual growth rate of 11.7%. This kind of consistent, double-digit growth is rare on the TSX and signals a shareholder-friendly management team focused on returning capital.
From a sustainability standpoint, TFI’s dividend appears rock solid. Its trailing-12-month payout ratio sits at just 36% of net income and only 20% of free cash flow — well below danger zones, suggesting the dividend is not only safe but has room to grow.
At its current price point near $124 per share, the yield might look modest at 2%, but don’t be fooled: this is a fast-growing income stream, not a stagnant one. And when dividends grow rapidly and are backed by earnings, they tend to drive strong capital appreciation over time.
A proven wealth builder
Long-term investors have already seen what TFI International can do. Over the past 10 years, the stock has delivered an astonishing 19.7% annualized total return per year. To put that in context, a $10,000 investment made a decade ago would now be worth over $60,000 — more than double the $25,420 you would have from investing in a broad Canadian stock market exchange-traded fund (ETF) over the same period.
This kind of performance shows that TFI International isn’t just a dividend grower — it’s a compounder. And thanks to its recent price dip, investors have a chance to buy into that compounding engine at a reasonable valuation.
Is now the right time to buy?
Analysts currently view the stock as fairly valued, which might not scream “bargain,” but when paired with a 38% decline from its highs and a resilient business model, it presents a decent entry point for a starter position for long-term investors. The company continues to generate strong free cash flow, and any normalization in shipping demand could reignite earnings momentum.
For investors seeking a mix of dividend growth, long-term upside, and a proven track record, TFI International might be worth a closer look as a top Canadian stock candidate. It may not deliver overnight fireworks, but with “fast dividends” and the potential for recovery-fueled gains, it’s a stock that could pay off handsomely over time.
