Investors who missed the big rally this year in the TSX are wondering which Canadian dividend stocks might still be trading at reasonable prices and are good to add to a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) portfolio focused on income and long-term total returns.
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Bank of Nova Scotia
Bank of Nova Scotia (TSX:BNS) is up 28% in the past six months. The stock trades near $89 per share compared to $64 at one point during the April tariff rout but is still below the $93 it reached in early 2022 before rate hikes in Canada and the United States triggered a pullback in the bank sector.
Some of Bank of Nova Scotia’s peers are trading at record highs and have outperformed the stock in recent years. A turnaround plan launched by the new CEO who took control in early 2023, however, should help BNS catch up.
Bank of Nova Scotia is shifting growth investments away from Latin America to focus more on the United States and Canada. Previously, the bank spent billions of dollars to acquire and build businesses in Mexico, Peru, Colombia, Chile and other Latin American countries on the hopes of benefiting from the expansion of the middle class as these economies expand. Shareholders, however, haven’t reaped the anticipated rewards. Bank of Nova Scotia sold its operations in Colombia, Costa Rica, and Panama earlier this year. Additional deals could be on the way.
In 2024, the bank spent US$2.8 billion to buy a $14.9% stake in KeyCorp, an American regional bank. The deal positions Bank of Nova Scotia to expand its U.S. presence.
Bank of Nova Scotia reported solid fiscal third-quarter (Q3) 2023 results, sparking the latest upswing in the stock. Net income was $2.5 billion compared to $1.9 billion in the same period last year. Provisions for credit losses came in at $1.04 billion, slightly lower than in fiscal Q3 2024, but dropped considerably from the $1.4 billion booked in fiscal Q2 2025.
It will take some time for the strategy transition to deliver full results. In the meantime, investors can still pick up a decent 4.9% dividend yield from BNS stock.
Canadian National Railway
Canadian National Railway (TSX:CNR) is down 20% in the past year. The rail giant took a hit in 2024 as a result of disruptions caused by labour strikes and wildfires. The company still managed a small increase in revenue compared to the previous year, but profits dipped a bit due to higher expenses.
In 2025, the tariffs imposed by the United States are impacting trade volumes from some key U.S. trade partners in core segments. This is making it difficult for CN to provide financial guidance through 2026 as the company tries to estimate demand for its services. CN operates 20,000 route miles of rail lines connecting Canadian ports on the Pacific and Atlantic with the Gulf Coast in the United States.
Despite the uncertainty, CN remains a profit machine. The company generated Q2 2025 earnings of $1.172 billion. Management revised guidance lower for the year, but CN still expects to deliver earnings growth.
The board raised the dividend in each of the past 29 years and is taking advantage of the low share price to buy back up to 20 million shares. Near-term weakness might persist, but there is decent upside potential when the trade deals with China, Canada, and Mexico are finally resolved. CNR sells for $131 per share at the time of writing. It was as high as $180 in 2024.
The bottom line
Bank of Nova Scotia and CN are top Canadian stocks paying good dividends that should continue to grow. If you have some cash to put to work, these stocks deserve to be on your radar.
