High-yielding dividend stocks are an excellent means to earn a healthy and reliable passive income in this low-interest environment. Investors can also reinvest these regular payouts to earn superior returns. Additionally, these companies are less prone to economic volatilities due to their solid financials and consistent payouts, thereby providing stability to investors’ portfolios. Against this backdrop, let’s examine three top Canadian stocks that offer dividend yields of over 6%.
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Enbridge
Enbridge (TSX:ENB) is an ideal choice for income-seeking investors, thanks to its consistent dividend growth and high yield. The company has adopted tolling frameworks and take-or-pay contracts to transport oil and natural gas across North America. Additionally, its low-risk utility assets and power-purchase agreement-based renewable energy sources provide stability to its financials while generating reliable cash flows. Amid these solid cash flows, the Calgary-based energy infrastructure company has raised its dividend for 30 years, while its forward yield stands at 6.09%.
Moreover, amid the growing energy demand, Enbridge has identified $50 billion in growth opportunities across its four segments over the next five years. Therefore, the company has planned to invest $9 billion to $10 billion annually to expand its asset base. Its financial position also looks healthy, with the liquidity of $13.4 billion at the end of the first quarter. Additionally, the company maintains a sustainable dividend-payout ratio of 60-70%. Therefore, I believe Enbridge is well-positioned to continue rewarding its shareholders with healthy dividends.
Telus
Another Canadian stock that I believe would be ideal for income-seeking investors is Telus (TSX:T), one of the three prominent telecom players in Canada. Telecom companies, including Telus, enjoy healthy cash flows due to their recurring revenue streams, thereby allowing them to reward their shareholders with dividends and share repurchases. The company has repaid $27 billion to its shareholders since 2004, with $22 billion in dividends and $5.2 billion in share repurchases. Also, it has raised its dividend 28 times since May 2011 and currently offers an attractive forward dividend yield of 7.46%.
Moreover, Telus is expanding its 5G and broadband infrastructure to expand its asset base and drive its average revenue per user. It has allocated $70 billion to strengthen its assets in Canada over the next five years. Additionally, its other businesses, Telus Health and Telus Agriculture and Consumer Goods, are witnessing healthy growth. Amid these healthy growth prospects, Telus’s management expects to raise its dividends by 3-8% annually through 2028, making it an attractive investment opportunity.
SmartCentres Real Estate Investment Trust
REITs (real estate investment trusts) are required to distribute at least 90% of their taxable income to their shareholders, making them an ideal investment for income-seeking investors. Meanwhile, I have chosen SmartCentres Real Estate Investment Trust (TSX:SRU.UN), which owns and operates 196 strategically located properties across Canada, as my final pick.
The company also has a solid tenant base, with more than 95% of its tenants having a regional or national presence. Also, more than 60% of these tenants offer essential services. Therefore, the company enjoys a healthy occupancy and collection rate, which allows it to maintain stable cash flows and pay dividends at healthier rates. Its monthly dividend payout of $0.1542 per share translates into a forward dividend yield of 7.17%.
Additionally, SmartCentres has a solid developmental pipeline, with permissions to develop 59.1 million square feet of mixed-use properties. Meanwhile, one million square feet of these properties are under construction. These growth initiatives could enhance SmartCentres’s financial performance, enabling it to continue rewarding its shareholders with healthy dividends.
