Canadian seniors are searching for good TSX dividend stocks to buy for a self-directed Tax-Free Savings Account (TFSA) portfolio focused on generating reliable and growing passive income.
In the current market conditions, where share prices have soared and economic weakness could be on the horizon, it makes sense to consider stocks with long track records of delivering dividend growth throughout the economic cycle.
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Enbridge
Enbridge (TSX:ENB) is one of the largest companies on the TSX with a current market valuation of nearly $149 billion. The stock trades for $68 at the time of writing compared to $44 two years ago.
Lower interest rates fuelled most of the gain over the past year. That trend could continue into 2026 after the Bank of Canada’s latest rate cut and market expectations for further reductions as the central bank switches its focus from fighting inflation to supporting the economy.
Enbridge uses a lot of debt to fund its growth initiatives, including acquisitions and organic projects. Lower interest expenses can boost profits and free up more cash for debt reduction and distributions to shareholders.
Enbridge bought three American natural gas distribution utilities in 2024. The company is also working on a $32 billion capital program. The new assets will deliver steady growth in distributable cash flow that should enable the board to continue raising the dividend over the next few years. Enbridge has increased its distribution annually for the past three decades. Investors who buy ENB stock at the current level can get a dividend yield of 5.5%.
Enbridge pivoted its capital investments away from major pipelines in recent years with acquisitions targeting export and renewable energy opportunities, along with the expansion of the natural gas distribution division. Looking ahead, the Canadian government now wants oil and natural gas producers to find new international buyers in order to reduce reliance on the United States. This could potentially lead to a new major pipeline project for Enbridge if existing government roadblocks are removed.
Fortis
Fortis (TSX:FTS) is another natural gas utility operator. The company also owns power generation and electricity transmission networks. Fortis hasn’t completed a large acquisition for several years, but consolidation in the utility sector could ramp up as borrowing costs decline.
Growth is currently coming from the $26 billion capital program. Fortis expects the rate base to rise from $39 billion in 2024 to $53 billion in 2029. As the new assets are completed and go into service, the jump in revenue and earnings should support planned annual dividend increases of 4% to 6% over five years.
Fortis raised the dividend in each of the past 51 years, so investors should feel comfortable with the guidance. The stock’s dividend yield is 3.6% right now. That’s lower than investors can get from other companies, but the dividend growth will steadily boost the yield on the initial investment.
Canada’s emerging plan to build a cross-country power grid could present new growth opportunities for Fortis due to its expertise in the construction and operation of electric transmission systems.
The bottom line
Enbridge and Fortis pay attractive dividends that should continue to grow. If you have some cash to put to work in a TFSA targeting passive income, these stocks deserve to be on your radar.
