I’d Buy These 2 TSX Dividend Leaders for Generational Income

Canada’s top brands now total US$212 billion in value, and Royal Bank and TD stand out as dividend-rich blue chips worth watching.

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Key Points

  • Royal Bank remains Canada’s top brand, offering a ~3% yield, diversified earnings, and a 45% payout ratio supporting steady dividend growth.
  • TD’s strong U.S. exposure and fee income back a 3.7% yield with a conservative 35% payout ratio.
  • Rising brand value reflects digital and wealth strengths, making these banks solid core picks for long-term, income-focused investors.

A new report by Kantar Brandz recently reported Canada’s most valued brands — ones that have increased their value by at least 10%. These top 40 companies have increased the value to US$212 billion, absolutely eclipsing Canada’s GDP of 1.3% for the first half of 2025.

The best news? Canada’s two most valuable companies are dividend leaders that still offer a huge pathway for growth. So, let’s look at these two on the TSX today.

RY

Royal Bank of Canada (TSX:RY) continued to hold the top spot as Canada’s most valuable brand, which it has held onto since 2019. This year, brand value surged 31% to US$46.7 billion, driven by digital banking, marketing, and client experience. It’s not just valuable or even just a dividend stock, but one of those rare companies that builds lasting wealth.

Royal Bank has paid dividends since the late 1800s, through world wars, recessions, and financial crises. Its current yield sits near 3%, with a payout ratio of just 45% at writing, which gives RY plenty of room to keep paying and increasing dividends even when profits dip. That disciplined approach is why it’s raised its dividend almost every year for more than a decade, averaging 7% to 8% annual dividend growth.

The bank’s balance sheet and business model explain why it can do this. RY is a global financial powerhouse with strong exposure to wealth management, insurance, and capital markets. That diversification makes it less vulnerable to one economic trend or region. In its third quarter of 2025, RY reported net income of $4 billion, up from $3.6 billion a year earlier, with a return on equity of nearly 15%. Even during slower lending growth, its wealth management and insurance divisions provide steady earnings, while its global footprint gives it flexibility when one region’s economy softens. Altogether, it’s a dividend leader that keeps on giving.

TD

Then we have Toronto-Dominion Bank (TSX:TD), with brand value up 7% to US$24.1 billion in 2025. TD stock managed to see strong performance in an environment where rising interest rates benefited many banks, with total brand value driving its growth. TD’s strength comes from its business model, one of the most diversified and stable in the banking world. TD now earns nearly one-third of its income from the U.S., making it more geographically balanced than any other major Canadian bank.

This diversification shows up in the numbers. In its third quarter of 2025, TD reported net income of $3.75 billion, up from $3.5 billion a year earlier, driven by solid growth in U.S. retail and wealth management. Return on equity came in strong at 14.2%, and it’s now thinking bigger. Despite the failed First Horizon deal in 2024, TD remains well-positioned to expand organically and through smaller, strategic acquisitions. Its digital banking platform is among the most advanced in North America, helping reduce costs while attracting younger customers. At the same time, its wealth and insurance divisions continue to grow, adding fee-based income that’s less volatile than lending profits.

Then there’s the dividend. TD has paid dividends for more than 165 years, a record few global companies can match. Today, the stock yields around 3.7%, supported by a 35% payout ratio. Furthermore, TD has raised its dividend at an average rate of roughly 9% annually over the past two decades. That’s nearly double the pace of inflation and faster than most Canadian blue chips. For long-term investors, that kind of consistency is what turns a modest income stream into a generational one.

Bottom line

If you’re an investor looking for growth, blue-chip companies like these are the way to go. These are dividend leaders, certainly, but also just leaders full stop. Whether it’s the expansion and diversification of the business or the absolutely unheard of dividend payouts, these are companies anyone can latch onto for generational wealth.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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