If you’re a Canadian looking for dividends, you want stability. That’s exactly what you get from industrial stocks. These are companies that play a big role in every community, from transportation and logistics to infrastructure and manufacturing. Simply put, they keep the economy running regardless of what’s going on in the market.
Yet among all these industrial stocks, there’s one that looks particularly interesting. So let’s get into why industrial stocks are such a great buy right now, and one to consider on the TSX today.
Industrial works
So we know that industrial properties are all around us. These properties are tied to long-term contracts, which means recurring revenue streams. Railways, transportation companies – all these move goods every day. Meanwhile, infrastructure provides a steady income from utilities to pipelines. These predictable cash flows allow investors to be confident in collecting dividends, even during poor economic periods.
What’s more, industrial stocks also combine income stability with long-term growth. Because of their essential nature, these stocks collect cash that can be used to expand even further. Whether it’s expanding through trade, infrastructure spending, e-commerce growth, or a shift toward automation, many factors drive demand for these resources.
Simply put, industrial stocks aren’t just here to say, they’re here to grow. And one that’s been growing for years with even more room to soar is Aecon Group (TSX:ARE).
Why Aecon
Aecon is an industrial stock that’s making a massive comeback. The growth stock has several features that support not just stability, but growth. Let’s start with its most recent earnings. The company hit a record-high backlog of $10.7 billion, giving it strong visibility and locking in future revenue streams.
These projects include North America’s first grid-scale Small Modular Reactor, plus nuclear refurbishments. The backlog also acts like a cushion, ensuring cash flow for years in the future. And with revenue growing 52% in the second quarter, with a swing back to profitability, that future is looking pretty bright.
Basically, Aecon is going through an exciting time. The industrial stock is moving past the drag of its older fixed-price projects, which hurt margins. Now, it’s looking far more positive with growth opportunities that don’t mean just a year or two of growth, but decades to come. And with a 3.5% dividend yield and improved execution and backlog, it’s looking like a top stock any investor will want to latch onto. In fact, a $7,000 investment in Aecon stock right now could mean $224 annually, or $56 each and every quarter!
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| ARE.TO | $23.76 | 295 | $0.76 | $224 | Quarterly | $7,011 |
Bottom line
While Aecon stock might still be in the recovery phase, that provides investors with the opportunity to grab hold of a rebounding industrial stock. One that provides a dividend while you wait. For those seeking the steady income of industrial properties, while still seeing higher-than-normal growth, Aecon is certainly one to add to your watchlist.
