Canadian seniors are searching for good TSX dividend stocks to add to their self-directed Tax-Free Savings Account (TFSA) portfolios focused on generating reliable and growing passive income.
Many stocks are trading near record highs after the big TSX rally in the past few months, but investors can still find some contrarian deals that now offer attractive yields.
Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) trades near $42.75 at the time of writing compared to $55 at its high point in 2024.
The pullback is largely due to a decline in oil prices. West Texas Intermediate (WTI) oil trades near US$65 per barrel right now compared to more than $80 last year. CNRL is a major oil producer with oil sands, conventional light and heavy oil, and offshore oil assets. Pricing for the oil varies depending on the type of oil and the customer. CNRL has flexibility to move capital around the portfolio to maximize margins as commodity prices change. The company’s large natural gas production operations and reserves help diversify the revenue stream and growth opportunities.
CNRL expands its revenue and reserves through a combination of strategic acquisitions and successful drilling on its properties. This has enabled the business to drive long-term earnings growth. The company is very efficient and has the balance sheet strength to make significant acquisitions at opportune times. For example, CNRL spent US$6.5 billion in 2024 to buy the Canadian assets owned by Chevron.
The board has increased the dividend in each of the past 25 years. Investors who buy CNQ stock at the current level can get a dividend yield of 5.5%.
Telus
Telus (TSX:T) trades near $21.50 at the time of writing. The stock is up more than 10% in 2025, but remains well below the $34 it reached in 2022 before going into an extended pullback.
Interest rate hikes by the Bank of Canada through 2022 and 2023 triggered the first leg of the drop in the share price. Telus uses a lot of debt to fund its capital program, which includes expansion of the wireline and wireless network infrastructure.
A price war in 2024, along with declining revenue at Telus Digital (Telus International), can be blamed for the continued weakness in the stock through to the end of 2024, even as borrowing costs dropped. Bargain hunters started to buy Telus earlier this year, however, on hopes that interest rates will continue to decline.
Headwinds remain due to reduced immigration and elevated debt costs, but the stock might be oversold at this point. Prices on mobile plans have moved higher in 2025. Telus Digital’s revenue appears to have stabilized, and Telus plans to take the subsidiary private. In addition, the Telus Health and Telus Agriculture and Consumer Goods divisions are growing at a steady pace.
Telus just announced a $1.3 billion deal to sell a 49.9% stake in its wireless tower infrastructure. Management will use the proceeds to reduce its debt and the company expects to continue lowering leverage through 2027 as its monetizes other assets including real estate and the sale of its copper hoard that was replaced with fibre optic lines. Telus raised the dividend by 7% for 2025. Earlier this year, the company said it expects to deliver ongoing dividend growth in the 3% to 8% range, supported by rising free cash flow. Investors who buy Telus right now can get a dividend yield of 7.7%.
The bottom line
Near-term volatility is expected, but CNRL and Telus pay good dividends that should continue to grow. If you have some cash to put to work, these stocks might be undervalued at current prices and deserve to be on your radar for a buy-and-hold TFSA portfolio focused on generating passive income.
