Investing in the right stocks can make a huge difference in your long-term portfolio. Selecting reliable dividend stocks to include in that portfolio can supercharge your long-term income potential.
Given the market volatility, sticky inflation, and geopolitical tensions, investing in reliable dividend stocks to offset that risk is recommended. Those dividends can provide predictable income, making them viable alternatives every investor should consider.
Here’s a trio of options to consider.
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Turn to this stock for defensive appeal
The first stock among those reliable dividend stocks to invest in is Fortis (TSX: FTS). Fortis is a utility stock that generates a recurring revenue stream that is backed by long-term regulated contracts.
The recurring revenue stream generated by Fortis is both predictable and growing. And thanks to the regulated nature and sheer necessity of the services provided, Fortis is one of the most defensive stocks on the market.
In short, customers cannot trade down their utility service like cell phone service. Nor can they opt for more frugal alternatives like store-branded items in the grocery store.
The defensive appeal of Fortis can offset market volatility while continuing to generate a stable revenue stream that leaves room for growth and pays a solid dividend.
That dividend currently pays out a yield of 3.5%. Adding to that appeal is the fact that Fortis has provided investors with generous annual upticks to that dividend going back over five decades without fail.
Another defensive pick with long-term upside
Another one of the reliable dividend stocks to consider owning right now is BCE (TSX: BCE).
BCE is one of Canada’s big telecom stocks. Telecoms like BCE are viewed as reliable dividend stocks, boasting some of the highest yields on the market. Part of the reason for that comes thanks to the defensive model that they offer.
BCE provides wireless, internet, TV, and wireline service to customers across the country through subscriber-based services. The company also boasts a large media segment that generates a complementary revenue stream.
In recent years, the defensive appeal of BCE’s subscription services has grown significantly. This can be traced back to surging demand for wireless services and the growing need for constant connected internet service.
This results in a solid business that generates a recurring revenue stream that pays a massive quarterly dividend. That dividend currently offers a yield of 5.2%, making it one of the better-paying options on the market.
Prospective investors should note that BCE is in a rebuilding phase. The company was forced to slash costs and its dividend over the past few years while it dealt with rising debt and higher interest rates. BCE even divested its interest in MLSE.
But incredibly, BCE didn’t just pay down its debt. The telecom is investing in growth within its core telecom segment. The telecom is also expanding into underserved markets through acquisitions, including the Ziply Fiber business.
BCE is doing this while continuing to pay a 5% yield. That makes it one of the reliable dividend stocks with plenty of upside to consider.
Invest in a pipeline business for stability
One final option for investors seeking reliable dividend income is TC Energy (TSX: TRP). Calgary-based TC Energy is one of the larger energy infrastructure companies in the country.
The company owns power assets and natural gas pipelines with assets located across Canada, the U.S. and Mexico. The natural gas pipeline hauls nearly one-third of the natural gas used in North America. TC Energy also has an interest in power plants.
This means that TC Energy generates a passthrough revenue stream, more like a toll road instead of an oil stock. In short, TC Energy moves energy and provides power, rather than selling it based on commodity prices.
This gives the company a unique defensive appeal. That stability also allows TC Energy to pay a handsome quarterly dividend that continues to grow. As of the time of writing, that dividend works out to 4.5%.
What are your reliable dividend stocks?
All stocks carry risk, and that includes the trio of options mentioned above. Where BCE, TC Energy, and Fortis differ, however, is that they also offer defensive appeal in addition to growth and steady revenue generation.
In my opinion, investors who are building a defensive core of reliable dividend stocks should consider one or all of these stocks.
