Invest $8,000 in These Dividend Stocks for $400 in Passive Income

With the TSX Index trading close to all-time highs, it might be time to get more defensive in some solid dividend stocks. When the stock market starts to tumble, quality dividend stocks tend to be less volatile.

Likewise, while the market dips, you can earn passive dividend income that can help set off any losses. Dividend income is nice to earn when the market is bearish. You at least know some returns can be earned through the downdraft.

If you had $8,000 to invest today, here are four dividend stocks that could collectively earn just under $400 every year.

A restaurant stock for dividend income

A&W Food Services (TSX:AW) operates one of Canada’s beloved burger brands. The brand name and association with consistent quality and service help provide a protective moat around the business.

The company is likely to grow at the rate of inflation, but not much more. However, it has a steady business model that generates good cash flow to support its dividend.

This dividend stock yields 5.29%. A $2,000 investment in A&W Food Services would earn $26.95 quarterly, or $107.80 annualized.

A top Canadian infrastructure stock

Another solid stock for dividends is Pembina Pipeline (TSX:PPL). It’s one of the largest midstream and pipeline players in Western Canada. It has built out the infrastructure and network to enable energy producers to efficiently get their product to market.

Over 85% of its income is contracted. That income supports its dividend by a wide margin. The company generates strong free cash flows, so it can self-fund growth projects without any equity dilution. Some of its future growth will come from an LNG terminal being developed, collection pipeline development, and a potential data centre power complex.

Pembina yields 5.3%. It has resumed a dividend-growth posture in the past few years. A $,2000 investment would earn $25.56 quarterly, or $102.24 annualized.

A residential real estate stock

BSR REIT (TSX:HOM.UN) is a Canadian-listed stock that operates exclusively in the U.S. Sunbelt. This dividend stock has over 7,000 residential rental units in resort-style communities.

In 2024 and 2025, BSR got caught with a bit of oversupply in its core markets. That has impacted cash flow growth. The good news is that it is located in some of the fastest-growing markets in America. That supply is quickly getting absorbed, and a supply deficit is imminent. You get to pick up the stock just before cash flows start to rise again. Its valuation is reasonably attractive now.

BSR yields 4.98% right now. A $2,000 investment in BSR would earn $8.30 monthly, or $99.60 annualized.

An industrial real estate stock for stable dividends

Granite REIT (TSX:GRT.UN) is another real estate play, but with a focus on industrial properties. It has a really high-quality portfolio that is complemented by one of the best balance sheets in the industry.

Granite has +97% occupancy. Its high-quality properties continue to see demand from leading tenants. Cash flows per unit are up 8% this year. That is after 9% growth last year. The company is restarting its acquisition plan, so there could be growth from both lease renewals and new properties.

This dividend stock yields 4.4%. It has raised its dividend for 15 consecutive years. A $2,000 investment would earn $7.40 monthly, or $88.75 annualized.