The Canadian equity market offers several high-quality dividend stocks that reward shareholders with consistent dividend payments and growth. Among these top dividend payers, there are a few dependable dividend stocks that I’d turn to first when markets start getting difficult.
These Canadian companies tend to operate in defensive sectors where demand remains relatively stable regardless of macroeconomic conditions. Their revenue streams are often supported by long-term contracts, regulated frameworks, or essential services, which insulate earnings from cyclical downturns. This structural resilience translates into steady free cash flow generation, supporting reliable dividend distributions.
Moreover, their strong fundamentals, defensive earnings, and resilient cash flow position them well to sustain their distributions and consistently increase them in the coming years.
Against this background, here is the dividend stock I’d turn to first when markets start getting difficult.
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A reliable Canadian dividend stock: Fortis
While several high-quality dividend stocks belong to defensive sectors, here I’ll focus on a top utility company. TSX utility stocks offer an excellent opportunity for investors seeking reliable, stress-free passive income. These stocks operate a defensive business and are known for consistent dividend payments. Their rate-regulated asset base helps generate predictable cash flows in market conditions, supporting their payouts.
In the utility sector, Fortis (TSX:FTS) is one of the reliable dividend stocks I’d consider as the market turns turbulent. The company’s asset base is heavily concentrated in regulated transmission and distribution operations, accounting for roughly 95% of its portfolio. This structure materially reduces exposure to commodity price volatility and broader economic swings, resulting in stable, highly visible earnings. For income-focused investors, this translates into a dependable base for dividend sustainability.
Over the past three years, the company has delivered average annual growth of approximately 6.5% in both its rate base and earnings per share (EPS). This steady growth has helped the company sustain its dividend-growth streak.
Fortis has increased its dividend for more than five decades, making it one of the most reliable long-term dividend growers. Last year, in November, Fortis raised its dividend by 4.1%, marking its 52nd consecutive year of dividend growth. Fortis stock currently offers a well-protected yield 3.3% based on its closing price of $77.49.
Fortis to keep growing dividends
Fortis appears well-positioned to maintain its record of dividend growth. The steady rate base growth provides Fortis with predictable earnings and supports consistent dividend payments.
The utility company’s $28.8 billion five-year capital plan is a key driver of its growth. Management expects the midyear rate base to grow from $42.4 billion in 2025 to $57.9 billion by 2030. Its growing rate base will support higher dividend payments. Fortis projects annual dividend increases of 4% to 6% through the end of the decade.
Looking beyond the current capital plan, Fortis retains multiple avenues for incremental growth. In the U.S., ongoing investment in electric transmission infrastructure is expected to support rising electricity demand and enable the integration of new energy sources, particularly renewables. Additional opportunities include transmission projects and regional upgrades in New York.
In Canada, Fortis is also targeting investments in renewable natural gas and liquefied natural gas infrastructure in British Columbia, alongside broader energy infrastructure development to accommodate accelerating demand across its service territories.
Overall, Fortis is well-positioned to deliver predictable cash flows, which positions it to keep paying and growing its dividend in all market conditions.
