It’s easy to get drawn toward well-known dividend stocks as they’re widely discussed, heavily analyzed, and often feel like the safest bets. But sometimes, the more interesting opportunities lie in companies that quietly deliver strong results without grabbing a lot of headlines. These under-the-radar stocks can offer a mix of solid income and meaningful growth – if you know where to look.
In this article, let’s take a closer look at one such Canadian dividend stock that could be worth watching in 2026.
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This lesser-known dividend stock is gaining momentum
For investors willing to look beyond the usual names, some lesser-known energy companies are quietly building impressive momentum. Meren Energy (TSX: MER) is one such example. This Vancouver-based company operates as an independent upstream oil and gas player with assets spread across offshore regions in Nigeria, Namibia, South Africa, and Equatorial Guinea.
The company’s portfolio includes producing and development projects in deepwater Nigeria, operated by global giants like Chevron. This gives it exposure to high-quality assets while benefiting from the expertise of established operators. Currently, Meren Energy stock trades at $2.37 per share with a market capitalization of about $1.6 billion.
Over the last year, MER stock has climbed 30%, reflecting improving investor confidence. On top of that, it offers an attractive 8.6% dividend yield, paid quarterly – making it appealing for income-focused investors.
Strong production and disciplined financials
Last year, Meren Energy’s strong operational performance could have been one of the reasons why it gained investors’ attention. In 2025, the company posted average daily working interest production of 30,800 barrels of oil equivalent per day (boepd), while its entitlement production stood at 35,100 boepd. Both figures were in line with its full-year guidance.
Its realized prices were also solid as it sold three cargoes at an average price of US$64.40 per barrel in the fourth quarter, while full-year sales averaged US$72.20 per barrel.
From a financial standpoint, the company generated EBITDAX (earnings before interest, taxes, depreciation, amortization, and exploration expenses) of US$440.7 million and cash flow from operations of US$261.8 million.
Projects that could drive the next phase of growth
Moreover, Meren Energy has several projects that could support its long-term expansion. In Nigeria, it’s preparing to restart drilling activities at Akpo and Egina, including the Akpo Far East prospect in early 2026 and additional infill wells through 2027.
Other developments are also progressing. The Agbami FPSO (floating production, storage, and offloading) life extension studies are expected to conclude in 2026, which could extend production life and support future output. In Namibia, its Venus Field development continues to be a key opportunity, with a final investment decision expected in 2026 and potential first oil targeted for 2030. Notably, this project is fully carried by its partners, which means Meren doesn’t need to commit upfront capital.
Meanwhile, in South Africa and Equatorial Guinea, the company’s ongoing exploration and license extensions provide additional upside potential.
Why this Canadian dividend stock could be worth watching
Meren Energy brings together several qualities that long-term investors often look for. It has strong production assets, improving financials, and a clear focus on disciplined capital allocation. Its exposure to multiple high-potential regions also reduces reliance on a single market. In addition, the company’s juicy dividend yield adds another layer of appeal.
While energy stocks can be volatile due to swings in commodity prices, Meren Energy looks particularly attractive with income and growth potential, especially for investors willing to accept some uncertainty.
