When it comes to investing in lifetime income, consistency matters more than excitement. That’s why dividend-paying utility stocks remain a top choice for investors who want predictable returns and steady growth. Fortis (TSX: FTS) is one of the most reliable names in the Canadian market. It isn’t flashy, but it does exactly what a long-term investor needs: pays cash, grows it slowly, and keeps doing it year after year.
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Into earnings
Fortis recently reported its first-quarter results for 2025. The dividend stock posted net earnings of $499 million, or $1.00 per share, up from $459 million, or $0.93 per share, in the same quarter last year. Revenue came in at $3.34 billion, up from $3.12 billion a year ago. The boost in earnings came from regulated rate base growth, as well as favourable regulatory outcomes, particularly at Central Hudson.
The best part about Fortis is its stability. Around 99% of its assets are regulated, meaning it operates in a low-risk environment where returns are tied to infrastructure investment. The dividend stock isn’t trying to chase high growth in volatile sectors; it’s focused on electricity and gas distribution. That steady business model provides a dependable source of income, and it’s backed by long-term capital plans.
In the first quarter of 2025 alone, Fortis invested $1.4 billion in capital expenditures, part of a broader $26 billion five-year plan aimed at expanding its regulated rate base. Fortis expects its rate base to grow from $39 billion in 2024 to $53 billion by 2029, a compound annual growth rate of 6.5%. When rate bases grow, earnings and cash flow tend to follow. And that’s what supports the dividend.
Now, that dividend
Right now, Fortis pays a quarterly dividend of $0.615 per share, which works out to $2.46 annually. At recent prices near $64, that gives it a yield of about 3.8%. While that yield may not be the highest in the market, it comes with unmatched reliability. Fortis has increased its dividend every year for 51 years, and management has guided for annual dividend growth of 4% to 6% through 2029.
Of course, no investment is perfect. Fortis carries a fair amount of debt; long-term debt stood above $30 billion as of Q1, because of the capital-intensive nature of the business. Interest costs are rising, and that’s something to keep an eye on. However, Fortis maintains strong credit ratings, reinforcing its ability to manage debt responsibly.
Another risk comes from regulation itself. While the dividend stock has a good track record with regulators, decisions don’t always go its way. In Arizona, for example, margins came under pressure from low wholesale electricity pricing. Changes in the economic environment, especially if inflation stays sticky or rates stay higher for longer, could make it more expensive to finance future growth.
Bottom line
Even so, Fortis continues to show it can adapt. With operations spread across ten regulated utilities in five Canadian provinces, nine U.S. states and three Caribbean countries, it’s diversified enough to weather regional issues. And with a growing need for grid upgrades and electrification, the long-term investment case for utilities remains strong.
For investors seeking lifetime income, the strategy is simple. Buy a dividend stock like Fortis on dips, reinvest the dividends when possible, and hold it for the long term. You won’t see massive price spikes, but you also won’t lose sleep over sudden crashes. It’s a foundation stock, one that helps keep your portfolio grounded.
So while it’s tempting to chase tech rallies or energy booms, the smart money often sticks with what works. Fortis is that kind of dividend stock. It delivers cash flow, grows it steadily, and gives you peace of mind in an unpredictable world. When the price dips, consider it a gift. That’s the kind of opportunity income investors wait for.
