Canadian dividend investors are searching for top TSX stocks that might be good buy-and-hold picks today for a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) portfolio focused on income and total returns.
Source: Getty Images
Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) raised its dividend in each of the past 25 years. That’s a solid track record from a business that relies on commodity prices to determine margins and profits.
CNRL is known for its oilsands production operations, but the company also has conventional light and heavy oil assets, as well as offshore oil and significant natural gas production and reserves. The stock pulled back in the past few days on concerns that increased supplies from Venezuela will replace Canadian heavy oil being sold to the United States. A small impact is likely, but the reaction in the market was probably overdone.
CNRL’s diverse products, efficient operations, and strong balance sheet enable it to generate good margins at low energy prices while being able to make large strategic acquisitions to drive production growth. New pipeline infrastructure connecting Canadian producers to the coast is already helping CNRL and its peers sell to international buyers. Additional capacity could be on the way as part of the government’s plan to reduce reliance on the United States for energy sales.
CNRL trades near $44 per share at the time of writing compared to the 12-month high around $49. Investors who buy CNQ at the current price can get a dividend yield of 5.3%.
Enbridge
Enbridge (TSX:ENB) trades near $63 per share compared to $70 near the end of September. The pullback was expected after a stellar rally over the past two years that saw ENB rebound from a decline that saw it slide to $45 when the Bank of Canada and the U.S. Federal Reserve aggressively raised interest rates to fight inflation.
The recovery in the stock occurred after rates peaked and picked up steam as the central banks started reducing interest rates to support the economy. Additional rate cuts are expected in the United States in 2026. This could provide a new tailwind for Enbridge.
Enbridge is working on a $35 billion capital plan that should boost adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) as well as distributable cash flow by 5% per year beginning in 2027. This should enable the board to maintain annual dividend growth. Enbridge has increased the distribution for 31 consecutive years.
In recent years, Enbridge purchased an oil export facility in Texas, acquired three American natural gas utilities, and became a partner on the Woodfibre liquified natural gas (LNG) export facility being built on the coast of British Columbia. The company also bulked up its renewable energy group. The diversification complements the core oil and natural gas transmission infrastructure and spreads out revenue risk.
Investors who buy ENB stock at the current price can get a dividend yield of 6.1%.
The bottom line
CNRL and Enbridge pay attractive dividends that should continue to grow. If you have some cash to put to work in a dividend portfolio, these stocks deserve to be on your radar.
