If you want to build a reliable income stream from your investments, it might not always be wise to chase high yields. In fact, you should focus on businesses that can consistently generate cash, grow over time, and keep rewarding shareholders through different market cycles.
That’s why many long-term investors focus on Canadian dividend stocks with strong fundamentals and stable growth prospects. When you find one that checks all the right boxes, it can become a core holding for years. In this article, I’ll spotlight one such TSX stock that stands out for cash flow planning.
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A mortgage lender built for steady income
The dividend-paying stock I’m talking about is MCAN Mortgage (TSX: MKP), which operates in Canada’s mortgage investment sector. It offers a diversified mix of residential, construction, and commercial lending. Its business is spread across three main segments: residential lending, commercial and construction financing, and wealth-related investments.
This diversified approach helps the company generate stable income while reducing its reliance on any single segment. It also allows MCAN to adapt to changing market conditions more effectively than more narrowly focused lenders.
Consistent performance backed by growing assets
MCAN Mortgage has delivered steady performance even amid market volatility. Its stock has gained about 10% over the last five months, reflecting improving investor confidence. At the current market price of $24.09 per share, it offers an attractive 7.2% annualized dividend yield.
In 2025, the company delivered net income of $74.9 million, slightly down by 3% YoY (year-over-year), while its net interest income dipped 1% to $95.8 million. Although these numbers show some pressure, its overall business remained resilient.
One of the most important highlights is the growth in its assets under management, which jumped 30% YoY to $7.8 billion. This growth was mainly driven by strong mortgage originations, particularly in its residential segment.
Meanwhile, its uninsured residential mortgage originations rose 33% from a year ago, while insured originations increased 38%. As a result, its total residential mortgage portfolio expanded 26% YoY to $4.6 billion.
Strong earnings streams and improving credit quality
MCAN’s investment in MCAP Commercial continues to be a key contributor to its growth. Last year, it generated $33.4 million in income, up 16% from the previous year, backed by higher securitization income and lower interest expenses.
While its provisions for credit losses increased to $13.5 million due to some pressure in construction loans and broader economic uncertainty, there was a positive trend in asset quality. Similarly, its impaired mortgage ratio improved to 1.7% from 2.5% a year earlier, indicating better credit performance and successful resolution of previously stressed loans.
The company also maintained a solid return on equity of 12.1%, which highlights its ability to generate consistent returns.
Why it remains a top choice for cash flow planning
MCAN Mortgage’s dividend story looks strong. It recently increased its quarterly dividend by 5% from the previous quarter to $0.43 per share. This consistent growth in its payouts reflects the company’s confidence in its cash flow generation ability.
At the same time, its disciplined approach to credit risk and improving asset quality adds an extra layer of confidence for investors.
Moreover, its diversified mortgage portfolio provides consistent cash flow, while its expanding asset base could support future earnings growth.
