The Ultimate Canadian Dividend Stock for Both Safety and Growth

Want a Canadian dividend you can hold forever? This global infrastructure powerhouse delivers steady, growing income and capital protection through market cycles.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published October 27, 2025 4:50 pm EDT

| More on: BIP.UN

When you’re searching for the ultimate Canadian dividend stock that balances safety and growth, you want a company that can pay you today and pay you more tomorrow. And that’s no matter what the economy does. It’s not about chasing the highest yield, but finding the most dependable compounding machine. Therefore it needs to be a business that grows earnings, raises its dividend consistently, and protects your capital through every market cycle.

View of high rise corporate buildings in the financial district of Toronto, Canada — Source: Getty Images

What to consider

The first thing to ask isn’t how much a company pays, but how securely it pays it. A yield over 6% may look tempting, but high yields often signal trouble. The real test is the payout ratio, which shows what portion of earnings or cash flow is used for dividends. For stable dividend payers, look for a payout ratio below 70%.

Furthermore, dividends are powered by profits, not promises. So the best dividend stocks are steady earners that generate predictable cash flow regardless of economic cycles. That means dividend stocks in stable industries like utilities, banks, telecoms and infrastructure, with long-term contracts. These industries should also include a presence in other countries, protecting you from domestic issues.

Yet to balance safety and growth, choose dividend stocks that don’t depend on economic booms to thrive. All this should add up to a dividend stock that’s raised its dividend for 10, 20, or even 50 consecutive years! These are Dividend Knights of at least five years of growth, all supported by a strong balance sheet. And ideally? Investors can get all this at a great share price.

BIP.UN

A great option on the TSX today in this case is Brookfield Infrastructure Partners L.P. (TSX: BIP.UN). In fact, it’s arguably the ultimate Canadian dividend stock for both safety and growth. The kind of investment you can hold through any market cycle and sleep soundly knowing your capital is working. At its core, Brookfield Infrastructure owns and operates the essential arteries of the global economy: the systems people and businesses can’t live without.

These assets include utilities, transport, midstream energy, and even data infrastructure. In total, BIP controls over USD$180 billion in assets as of mid-2025 across more than 30 countries. The vast majority of its revenue at over 90% comes from either regulated or contracted cash flows, meaning it’s locked in and largely immune to short-term market swings.

Furthermore, infrastructure is inherently stable. It’s expensive to build, slow to replicate, and crucial for daily life. This gives BIP high barriers to entry and predictable cash flow. Cash flow is incredibly stable, as Brookfield is famous for its “capital recycling” model. It buys undervalued, cash-generating infrastructure, improves it, then sell portions at a premium and reinvests into new opportunities. This strategy has delivered an impressive 15% or more annualized total return since inception in 2008, roughly double the TSX Composite over the same period.

More to come

Second quarter 2025 results show why BIP remains a model of consistency even in a volatile environment. It posted funds from operations (FFO) at USD$594 million (USD), up 8% year-over-year. Distributable cash flow (DCF) rose 7% YoY with organic growth up 10% from inflation-linked contracts, volume gains, and new investments. Net income hit USD$374 million (USD), up 9% YoY, with management reaffirming its target of 5% to 9% annual FFO growth and 5% to 9% annual distribution increases. A pace it has sustained for more than a decade.

Then there’s the dividend. Since 2009, Brookfield Infrastructure has increased its payout every single year, a 16-year streak, compounding at an average 9% annually. And Brookfield isn’t just an old-school utility owner. It’s evolving into a next-generation infrastructure powerhouse. This supports stable future growth in shares as well as dividends.

Bottom line

Now, BIP isn’t exactly cheap, though it trades at 0.73 times sales. But it’s the definition of a “sleep-well-at-night” dividend growth stock. It offers the predictability of a utility, the growth potential of a global infrastructure investor, and the inflation protection of real assets. All under the disciplined guidance of Brookfield.