Top dividend-paying stocks with high and sustainable payouts are reliable investments to generate steady passive income for decades. The most dependable dividend stocks often belong to companies with well-diversified revenue streams, steadily growing earnings, and a proven record of rewarding shareholders year after year. These are the kinds of businesses that survive economic downturns and continue to reward investors through regular dividend hikes.
One such high-quality TSX stock is Enbridge (TSX:ENB). This energy infrastructure company currently has a yield of over 5.6%. Besides high yield, this energy transportation company has a solid dividend payout history.
Its solid fundamentals and diverse operations, spanning oil and gas pipelines, natural gas utilities, and renewable energy projects, provide stability even in volatile market conditions. Further, Enbridge is well-positioned to continue delivering robust cash returns to shareholders. Let’s take a closer look.
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Enbridge: A reliable dividend-growth stock
Enbridge’s consistent dividend hikes and sustainable payouts make it a reliable dividend-growth stock. It currently pays a quarterly dividend of $0.943 per share, amounting to $3.77 annually. The company’s earnings are supported by regulated and long-term contracted assets, which provide predictable and growing distributable cash flow (DCF) across all commodity or economic cycles.
Its solid earnings foundation has enabled Enbridge to deliver over 70 consecutive years of dividend payments and 30 straight years of dividend increases. Over the past three decades, its dividend has grown at a compound annual growth rate (CAGR) of 9%.
Further, by maintaining a dividend payout ratio of 60-70% of its DCF, the company ensures that it retains sufficient capital to reinvest in future growth projects while still rewarding shareholders. This disciplined approach provides a solid base for continued dividend growth.
Enbridge’s dividend to increase at a mid-single-digit rate
Enbridge will continue rewarding its investors with reliable dividend growth in the years ahead. The company’s extensive portfolio of growth projects and its balanced investments across traditional and renewable energy assets reflect its ability to deliver consistent returns even as the global energy landscape evolves.
With a massive and diverse network of energy infrastructure spanning North America, Enbridge’s systems witness a high utilization rate. Further, its business model is structured to minimize exposure to commodity price swings, providing a solid base for sustained cash generation. Nearly 98% of its EBITDA is derived from regulated operations or long-term, take-or-pay contracts. These frameworks help generate steady earnings regardless of short-term market volatility.
Its earnings resilience is further supported by strong regulatory and contractual safeguards. Roughly 80% of Enbridge’s EBITDA comes from assets equipped with revenue inflators or regulatory mechanisms that protect both profits and shareholder payouts. This stability enables Enbridge to continue growing its dividend even during periods of economic or geopolitical uncertainty.
Looking forward, Enbridge’s engagement in emerging sectors, with 10 AI-driven data center projects, augurs well for growth. Moreover, Enbridge is also well-placed to benefit from the energy transition, particularly through opportunities like coal-to-gas conversions and expanding its renewable footprint.
Overall, its diverse revenue streams, low-risk commercial framework, and AI-driven opportunities position it well to pay and increase its dividends. Enbridge’s management anticipates mid-single-digit growth in earnings and DCF per share in the medium term, which should translate into a similar pace of dividend increases, making it a compelling income stock to buy and hold.
