1 Rock-Solid TSX Dividend Stock to Buy Before RRSP Season Ends

RRSP season makes yields look irresistible, but Canadian Utilities is really a “sleep-well” pick only if you’re happy with slow compounding and regulatory risk.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published February 6, 8:00 pm EST

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Key Points

Canadian Utilities earns mostly regulated utility revenue, which supports a long record of dependable dividend growth.
It just extended its streak to 54 straight years of dividend increases, showing real commitment to the payout.
The key risk is regulator-set returns and capital spending needs, so returns may stay steady but not exciting.

Registered Retirement Savings Plan (RRSP) season can turn sensible investors into yield shoppers. You see a dividend, you picture retirement income, and suddenly the business fades into the background. Do not let that happen. In an RRSP, dividends can compound nicely, but only if the company can fund the payout and maintain its assets. Check payout ratios, debt, and the capital spending needed to keep service reliable. Then ask one question: Can you hold it through a dull year and still feel fine?

The RRSP (Canadian Registered Retirement Savings Plan) is a smart way to save and invest for the future — Source: Getty Images

CU

Canadian Utilities (TSX:CU) often earns that “rock-solid” label because it sells something Canadians always consume. It sits inside the ATCO group and runs regulated electricity and natural gas utilities, plus other energy-related operations. This ties a large share of earnings to approved rates and long-lived infrastructure. CU is not a stock that needs a perfect consumer mood or a hot commodity price. It needs steady investment, safe operations, and reasonable decisions from regulators.

Over the last year, the headlines have leaned more toward “steady grind” than “big splash,” which is exactly why dividend investors like it. In October 2025, it declared a quarterly dividend of $0.4577 per share, or $1.83 annualized at the time. In January 2026, it raised that quarterly dividend to $0.4623 and extended its streak to 54 consecutive years of dividend increases.That shows how seriously management and the board treat the payout.

Regulation has also stayed front and centre. Canadian Utilities operates heavily in Alberta, where the Alberta Utilities Commission sets an allowed return on equity for utilities. The AUC set the 2025 return on equity at 9%. Management has flagged headwinds from a lower allowed return and the end of an efficiency mechanism. That is the core risk with a utility. The business can run smoothly, while the regulator still squeezes the math.

Earnings support

Even so, earnings have stayed steady enough to support the dividend story. In the third quarter of 2025, Canadian Utilities reported adjusted earnings of $108 million, or $0.40 per share, up from $102 million, or $0.38 per share, a year earlier. It also reported earnings attributable to shares of $166 million, or $0.61 per share, which can move around with one-time items and timing. For an RRSP investor, the cleaner message is simple: the underlying business kept inching forward.

The next question is what keeps that trend alive. The answer usually comes down to capital investment that expands and modernizes the regulated network. In its Q3 2025 update, the company said it invested $402 million in capital expenditures, with 95% directed to regulated utilities. Earlier 2025 disclosures also pointed to system upgrades and growth projects, including Yellowhead in natural gas transmission and CETO in electricity transmission, plus work tied to the Atlas Carbon Storage Hub in its energy growth segment.

Valuation, meanwhile, looks like what you would expect for a steady Canadian utility. The dividend stock trades at 22.6 times earnings with a 4.13% dividend yield at writing. That isn’t bargain-bin pricing, but it also is not priced like a stock that needs miracles. You are paying for resilience, not fireworks. If interest rates drift lower later in 2026, the market often treats utilities more kindly, but the business still needs supportive regulation to deliver. And right now, $7,000 can still bring in a lot.

COMPANY	RECENT PRICE	NUMBER OF SHARES	ANNUAL DIVIDEND	ANNUAL TOTAL PAYOUT	FREQUENCY	TOTAL INVESTMENT
CU	$43.99	159	$1.84	$292.56	Quarterly	$6,994.41

Bottom line

So, is it a rock-solid TSX dividend stock to buy before RRSP season ends? It could be, especially if you want dependable income with lower drama and you can accept slow-and-steady returns. The risks still matter. Regulators can tighten returns, and higher borrowing costs can pinch free cash flow. If you need fast upside, this will feel sleepy. If you want an RRSP anchor that can quietly compound while you focus on life, Canadian Utilities deserves a serious look.