Enbridge (TSX:ENB) has long been a go-to dividend stock for Canadian investors. Its 5.8% forward yield and reputation for consistency have made it a staple in income-focused portfolios. The dividend stock just delivered record second-quarter earnings before interest, taxes, depreciation and amortization (EBITDA) and reaffirmed its full-year guidance. Furthermore, it now boasts a $30 billion project backlog across natural gas, liquids, and renewable power. On paper, it looks like more of the same reliable performance investors have come to expect. But for those looking for dividend growth and total return upside, another Canadian name is quietly making the case to take its place: Power Corporation of Canada (TSX:POW).
Why Power
Power Corporation is not a pipeline company. It’s a diversified financial holding company with interests in insurance, wealth management, fintech, and alternative assets. Over the past year, the dividend stock surged almost 47%, outpacing Enbridge’s roughly 22% gain. More importantly, its fundamentals show a business with momentum. In the second quarter of 2025, Power reported adjusted net earnings of $883 million, up from $739 million the year before. The adjusted net asset value climbed to $64.76 per share, while book value per share nudged higher as well.
Unlike Enbridge, which operates under heavy debt loads with leverage near $100 billion, Power Corporation benefited from a capital-light model through its stakes in Great-West Lifeco and IGM Financial. Lifeco posted double-digit adjusted earnings growth in its wealth and group benefits units, while IGM delivered a 15% year-over-year bump in adjusted net earnings and reported record assets under management of nearly $284 billion. Together, these continue to pump steady cash flows to the parent dividend stock, fuelling dividend growth and opportunistic buybacks.
More to come
One of the biggest differentiators for Power is its exposure to high-growth fintech through Wealthsimple. This saw its valuation jump 21% in the second quarter alone. While Enbridge continues to rely on long-cycle energy infrastructure projects to move the needle, Power has a blend of stable financial services earnings and upside potential from newer investments in technology and sustainable platforms. Sagard, its alternative asset arm, raised US$1.5 billion in new commitments last quarter, demonstrating its ability to grow fee-bearing capital much like the big private equity shops.
On the dividend front, Enbridge’s payout remains attractive in the short term, but it comes at a cost. Its payout ratio sits well over 100% of earnings, thus dividend growth will continue to rely heavily on distributable cash flow from its assets. By contrast, Power Corporation pays out less than 60% of earnings while still offering a healthy yield around 4.3%. That leaves room for sustainable increases while also allowing the company to reinvest in growth areas. For comparison, a $5,000 investment would earn investors $290 annually from Enbridge and $213 from Power, but Power looks a lot more stable.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| ENB | $64.79 | 77 | $3.77 | $290.29 | Quarterly | $4,988.83 |
| POW | $57.29 | 87 | $2.45 | $213.15 | Quarterly | $4,982.23 |
Foolish takeaway
Investors should not dismiss Enbridge. Its pipeline network, utility acquisitions, and new renewable projects like the 600 MW Clear Fork Solar development with Meta prove it remains a powerhouse in North American energy. But growth is steady rather than spectacular, and debt constraints limit how aggressive the dividend stock can be with dividend hikes or opportunistic deals. For investors chasing income stability, Enbridge works. For those seeking a balance of yield, dividend growth, and capital appreciation, Power Corporation is looking increasingly compelling.
The past year highlights the contrast clearly. Enbridge reaffirmed guidance and continues to deliver steady results, but Power has shown accelerating earnings, a rising net asset value, and strategic exposure to growth markets like fintech and alternative assets. If the choice is between holding onto Enbridge for its reliable but slower-growing dividend or rotating into a diversified financial holding company with growing cash flow and a lower payout ratio, Power Corporation might just be the more magnificent dividend stock for the next decade.
