These 2 Dividend Stocks Still Look Like Bargains to Me

Bargain dividend stocks don’t always look exciting at first glance. Often, they sit in unloved sectors, carry some near-term noise, or trade below what their assets suggest they could be worth. That’s exactly why they can appeal to patient investors. The key is to look for companies with real cash flow, manageable debt, useful assets, and dividends they can support. A company being cheap alone isn’t enough, but if it’s cheap with a reason to recover? That’s where things get more interesting.

POU

Paramount Resources (TSX:POU) looks like one of those names. The Calgary-based company produces oil, natural gas, and natural gas liquids in Western Canada, with core assets in the Duvernay and Montney. It changed dramatically over the last year after selling its Karr, Wapiti, and Zama properties for about $3.24 billion. That deal reshaped the business, gave Paramount a cleaner growth focus, and helped fund a massive $15-per-share special cash distribution in early 2025.

The company then leaned hard into growth. Paramount brought the first phase of its Alhambra Plant at Willesden Green onstream in July, ahead of schedule and under budget. It also sanctioned the second phase, which should come online early in the third quarter of 2026. Meanwhile, it sanctioned the Sinclair Montney natural gas development, expected to start in the fourth quarter of 2027. This gives Paramount a clear runway instead of a vague “maybe someday” growth story.

The latest earnings show both the opportunity and the messiness. Fourth-quarter sales volumes hit 46,973 barrels of oil equivalent per day (boe/d), up 30% from the third quarter. For 2025, adjusted funds flow came in at $467 million, or $3.25 per share. Cash from operating activities reached $417 million. Yet free cash flow was negative $386 million, mainly because Paramount spent heavily on development. Still, with the stock recently trading around seven to eight times 2025 adjusted funds flow and paying a monthly dividend of $0.05 per share, yielding about 2%, investors get growth, income, and optionality if energy prices cooperate.

GRT

Granite Real Estate Investment Trust (TSX:GRT.UN) offers a very different kind of bargain. It owns industrial, logistics, and warehouse properties across North America and Europe. These are not flashy assets, but they remain useful in a world built around supply chains, e-commerce, manufacturing, and distribution. Granite stock also has a global portfolio, strong tenants, and a monthly distribution, which makes it appealing for income investors who want something steadier than an energy producer.

The last year was stronger than the unit price might suggest. Granite stock reported fourth-quarter net income attributable to unit holders of $135.4 million, up from $83.7 million a year earlier. For 2025, adjusted funds from operations (AFFO) came in at $319.8 million, or $5.21 per unit, compared with $307.1 million, or $4.86 per unit, in 2024. Occupancy ended the year around 98%, with committed occupancy even higher at 98.6%. That’s a healthy sign in a real estate market where not every landlord can say the same.

Valuation makes Granite stock look attractive as it recently traded near 16.6 times earnings. Its annualized distribution rose to $3.55 per unit, giving it a yield near 3.73% at writing. The payout ratio also looks comfortable, with AFFO covering the distribution well. The risks include higher refinancing costs, weaker industrial demand, and currency swings. Still, Granite stock’s 2026 guidance points to more FFO and AFFO growth, which gives the bargain case some real backbone.

Bottom line

Paramount and Granite stock won’t suit every investor. Paramount offers more upside, but commodity prices can swing hard, while Granite stock offers steadier income, but real estate still feels rate pressure. Yet both look cheaper than their long-term potential suggests, and can create immense income even with $7,000 in each.

For dividend investors who can handle a little noise, these two TSX stocks still look like bargains worth watching closely.