It’s not easy to find dividend-paying stocks that combine consistency, strong returns, and business models built for the long term. Many companies can pay a dividend for a while, but only a few can keep increasing it through good and bad economic cycles.
That’s where fundamentally strong companies like MCAN Mortgage (TSX:MKP) continue to impress. With a 7.7% yield and a reputation as Canada’s largest mortgage investment corporation, MCAN has built its income strategy around real lending strength, not just payouts. For investors searching for reliable income in a cautious market, this small-cap dividend player could be one to buy in bulk right now. In this article, I’ll highlight what’s driving MCAN’s momentum and why it looks so attractive.
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A top small-cap dividend stock to buy in bulk
Headquartered in Toronto, MCAN operates as a mortgage investment corporation, meaning it pools investor capital to fund residential and construction mortgages across Canada. Unlike most lenders, it’s federally regulated, and it distributes nearly all taxable income to shareholders, which is how it sustains that high 7.7% dividend yield.
Shares of this financial services firm currently trade at $21.40 apiece, with a market cap of about $865 million. While broader financial stocks have faced volatility in recent years, MCAN’s shares have gained roughly 17% so far in 2025, marking its third consecutive year of positive movement.
This consistency reflects investors’ growing confidence in its lending model, which prioritizes diversified mortgage exposure across insured and uninsured segments.
Stable financial results despite macroeconomic uncertainties
Despite the uncertain economic environment, MCAN managed to grow its net profit by 2% sequentially to $20.5 million in the third quarter of 2025. Its earnings stood at $0.52 per share, while return on equity came in at around 13.1%, showing resilience even as its credit provisions rose.
At the end of the latest quarter, the company’s total assets under management stood at $7 billion, reflecting an 18% YTD (year-to-date) increase. At the same time, its total assets grew by 11% YTD to hit $5.9 billion. A large portion of this growth came from a surge in MCAN’s mortgage originations – especially a 30% sequential jump in its uninsured residential loans following the launch of its new securitization program with a major Canadian bank.
This program allows MCAN to free up capital and recycle funds into new loans, which is expected to improve its balance sheet efficiency in the long run. Meanwhile, the company’s residential construction mortgage balances also climbed 8% YTD to $1.2 billion, showing healthy demand even in a tighter lending environment.
In addition, the company’s credit quality remains solid, with the impaired mortgage ratio at just 2.6%, mainly tied to residential construction loans.
This could be a reliable income stream for long-term investors
With more than three decades of uninterrupted dividends, MCAN has proven its reliability through multiple economic cycles. Its management continues to target a 13% to 15% average return on equity and 10% annual growth in assets, while maintaining sustainable dividend growth. Moreover, MCAN’s expanding funding sources, including its direct-to-consumer term deposit business, provide a low-cost, stable capital base that could support its future lending growth.
In short, this is not just a high-yield stock but a business built to keep paying. That’s why MCAN Mortgage looks like a top dividend stock to buy before the year closes, especially for investors aiming to grow passive income with confidence.
