Investors seeking steady passive income can add top dividend-paying stocks with sustainable and high yields. However, note that payouts depend on a company’s financial health, reflecting the importance of selecting firms with resilient business models, diverse revenue streams, a proven track record of increasing dividends, and strong future earnings potential. Within this context, here is a top TSX stock that currently offers a yield of 5.2% and has not missed a payment in 20 years.
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A 5.2% dividend stock offering a worry-free dividend
While many TSX-listed stocks offer dependable dividends, TC Energy (TSX:TRP) stands out for its resilient payouts, attractive yield, solid dividend growth history, and visibility over future dividend increases.
TC Energy operates an extensive network of natural gas pipelines. This core business is complemented by strategic investments in power generation, creating a diversified and stable cash flow foundation. What sets TC Energy apart is its highly contracted, low-risk business model. Around 97% of its earnings before interest, taxes, depreciation, and amortization (EBITDA) are supported by regulated or take-or-pay contracts. These agreements insulate the company from price and volume fluctuations, ensuring predictability in its earnings and shielding it from broader market volatility.
This consistent stream of high-quality cash flow has enabled TC Energy to build a remarkable track record for dividend payments. TRP stock has raised its dividend for 25 years in a row. This means it has not missed a single payout in over two decades. TC Energy’s ability to maintain and grow its dividend through challenging periods is a reflection of the strength and reliability of its operations.
Currently, TC Energy offers a quarterly dividend of $0.85 per share, which equates to a robust yield of 5.2%.
TC Energy to keep growing its dividend
TC Energy has a solid dividend payment and growth history, and the outlook remains strong for years to come. Its high-quality, contracted infrastructure assets position it well to continue growing its payouts.
In particular, its U.S. natural gas pipelines operate under long-term take-or-pay contracts, which provide predictable revenue and shield the company from volume-based risks. This stability helps drive steady EBITDA growth and supports its dividend payment.
Looking ahead, the company is well-positioned to benefit from macroeconomic tailwinds. The projected growth in liquefied natural gas (LNG) exports and accelerating shift from coal to natural gas, driven by both power generation needs and increasing energy consumption from data centres, are expected to align directly with TC Energy’s strengths. The company is already deeply integrated into these trends, with a healthy pipeline of projects tied to these transitions.
In fact, over the past six months, TC Energy has greenlit around $4 billion in new capital projects. It also anticipates placing about $8.5 billion worth of projects into service in 2025. This includes infrastructure supporting coal-to-gas conversions and meeting the increasing energy demands from the digital economy.
To maintain its growth trajectory, TC Energy is targeting $6 billion in annual net capital expenditures, with a focus on projects that offer strong risk-adjusted returns. Such a disciplined approach will extend the company’s growth pipeline well into the next decade. This will ensure its operations remain low-risk and highly efficient.
As a result, TC Energy is likely to deliver annual dividend growth of 3–5%. Moreover, it is focusing on improving its balance sheet by reducing debt.
In summary, TC Energy is a dependable income stock that is unlikely to miss its payment in the next 20 years.
