In today’s volatile markets, reliable income streams are more precious than ever for Canadian investors building long-term wealth. Dividend growers with proven track records stand out as resilient anchors amid economic uncertainty.
Here are three excellent dividend stocks for those investors who are truly long-term minded and want passive income streams that will match that horizon.
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Fortis
It should be no surprise to readers that Fortis (TSX: FTS) is the first pick on my list.
After all, Fortis has delivered over 50 consecutive years of annual dividend increases. That has earned the company its status as a Canadian Dividend Aristocrat with a current yield around 3.3%. Notably, the company’s payout ratio hovers at a sustainable level. This is backed by steady cash flows driven by regulated utility earnings and a massive $57.9 billion five-year capital plan.
These factors are expected to fuel 4–6% annual dividend growth through 2029. Right now, with interest rates stabilizing and energy demand rising, Fortis offers defensive growth. The company’s revenue growth of more than 5%, net income growth of 5%, and even more impressive upside on cash flow (7.5% over the past year) makes this stock a screaming buy for dividend growth investors.
Toronto-Dominion Bank
Another top pick of mine from a dividend perspective is Toronto-Dominion Bank (TSX: TD).
Shares of the Canadian bank have been on a tear of late, driven by solid results. The company posted strong earnings despite post-regulatory hiccups, with earnings per share surging to $1.41 this past quarter.
With U.S. expansion continuing (benefiting from Trump’s pro-banking policies) and buybacks continuing, there’s more to this company than the dividend angle. However, with a current dividend yield of 3.3% and 36 straight years of dividend increases, I think there’s an easy-to-understand thesis as to why investors want to consider this top-tier dividend stock right now.
As interest rates continue to come down, the yield curve steepens, and net interest margins widen, I think TD stock is poised for even more upside from here.
Magna International
Last, but not least, we have Magna International (TSX: MG).
Having raised its dividend for more than 30 consecutive years, Magna has also crossed the threshold into dividend aristocrat status. The company continues to deliver a compelling 5.2% yield with 7–12% average growth over five to ten years.
Supported by a payout ratio that’s reasonable, I think there’s ample room for a continuation of this trend. That goes double for those who think an auto sector recovery is underway.
With a high-single-digit price/earnings ratio and more robust supply chains than we’ve seen in some time, I think this is a top dividend stock with a very juicy valuation. Any time investors can pick up shares of a world-class stock with this kind of cash flow potential at a discount, it’s a win. Take the win.
