It pays to stay invested, and nothing proves it better than resilient dividend growth stocks. A 10-year tenure is a sweet spot for compounding returns. The headwinds subside in two to three years. A turnaround materializes in six to seven years. Even a major crisis like the 2008 Global Recession did not last more than five years. As Warren Buffett says, “If you aren’t willing to own a stock for 10 years, don’t even think about owning it for 10 minutes.”
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10 years from now, you’ll be glad you bought three magnificent dividend stocks
There is something special about 10 years, and that something special is the power of compounding. With the below magnificent stocks, you can witness the true power of compounding 10 years from now.
Canadian Natural Resources
Canadian Natural Resources (TSX: CNQ) is a buy for its double-digit dividend growth. Holding the world’s second-largest low-maintenance oil sands reserves, CNQ has a cost advantage that allows it to grow dividends. It has a 25-year history of growing dividends in the range of 2%–56%. It has incorporated the dividend amount in its breakeven price of mid-$40 per barrel, which assures you that the company can sustain its dividends. Canadian Natural Resources also gives special dividends when the oil price is high.
If you bought 1,000 shares of CNQ in January 2016 for $14,450, you would have gotten $470 in annual dividends in 2016, which would have grown to $2,350 in 2025. 2016 witnessed a major oil crisis as US shale exploration permanently reduced the oil price from US$100/barrel to US$60/barrel. Then the pandemic created an oversupply issue that reduced the oil price to US$35/barrel for a brief period. After the two major crises, the oil price rallied to US$125 in 2022 when the lockdown ended and the Russia-Ukraine war created a supply shock.
In the last 10 years, a $14,450 investment in CNQ paid a cumulative dividend of $12,900 and increased the value of those 1,000 shares to $48,000. This is before compounding. Had you reinvested the dividends, your 2025 annual payout would be $3,221, and your 10-year cumulative dividend payout would be around $15,920.
| Year | CNQ Dividend per Share | Total Share Count | Total Dividend | CNQ Share Price on January 1 | New Shares Purchased |
| 2025 | $2.350 | 1371 | $3,221.85 | $44.85 | 47 |
| 2024 | $2.138 | 1324 | $2,830.05 | $43.50 | 42 |
| 2023 | $1.850 | 1282 | $2,371.70 | $37.30 | 62 |
| 2022 | $2.300 | 1220 | $2,806.00 | $26.54 | 37 |
| 2021 | $0.999 | 1183 | $1,181.52 | $15.13 | 56 |
| 2020 | $0.850 | 1127 | $957.95 | $20.23 | 37 |
| 2019 | $0.750 | 1090 | $817.50 | $15.56 | 43 |
| 2018 | $0.670 | 1047 | $701.49 | $21.40 | 25 |
| 2017 | $0.550 | 1022 | $562.10 | $21.04 | 22 |
| 2016 | $0.470 | 1000 | $470.00 | $14.45 | |
| $15,920.16 |
Automatic compounding with a dividend reinvestment plan
In CNQ, you have to buy shares at market price and pay a brokerage to compound the returns. However, some TSX stocks offer a dividend reinvestment plan (DRIP), which saves you brokerage fees and automates compounding.
Manulife Financial (TSX: MFC) and Telus Corporation (TSX: T) have been growing their dividends at a 10-year average annual rate of 10% and 7%, respectively. Telus has slowed its dividend growth as changes in the regulatory landscape have affected its cash flows.
The management expects to grow dividends by 3–8% between 2026 and 2028 as it deleverages its balance sheet to increase cash flow. Telus has reduced its capital spending on network infrastructure and is focusing on expanding its customer base on partner networks. Once it brings down leverage and harnesses the 5G potential, it may accelerate its dividend growth.
Meanwhile, Manulife is seeing strong demand for its health, wealth, and life insurance products across the United States, China, and Asia. The company is growing organically and through acquisitions. It has acquired U.S.-based Comvest Credit Partners and PT Schroder Investment Management Indonesia. It has also partnered with Mahindra & Mahindra to enter the Indian insurance market and strengthen its presence in the world’s largest economies.
The above expansion plans will help Manulife secure higher premiums, giving it room to continue growing dividends.
Investor takeaway
Investing in the above three dividend stocks and holding them for 10 years can give you the dual benefit of dividend growth and compounding through a DRIP.
