A high dividend yield can seem like an easy win, especially when you’re searching for reliable passive income during uncertain markets. But the reality is that some of the market’s highest-yielding dividend stocks carry the biggest risks. Companies offering oversized payouts are sometimes struggling with weak earnings, excessive debt, or unsustainable business models that eventually put those dividends in danger. That’s why experienced investors tend to focus less on chasing the biggest yield and more on owning financially strong businesses with dependable cash flow and stable long-term growth prospects.
Right now, two Canadian stocks stand out for exactly those reasons as they offer reliable dividends backed by resilient operations and disciplined expansion strategies instead of risky payout promises. Let’s explore why these TSX stocks may be smarter long-term income investments than many ultra-high-yield alternatives.
Source: Getty Images
Keyera stock
The first stock that looks attractive based on this balanced approach is Keyera (TSX:KEY), especially for investors who want dependable income without taking on excessive risk tied to high yields. It operates an integrated energy infrastructure business focused on natural gas gathering and processing, NGL transportation and storage, marketing, and iso-octane production.
After climbing 27% over the last six months, KEY stock trades around $55 per share with a market cap of roughly $15.6 billion. At this market price, it offers a 4% annualized dividend yield.
A top reason behind Keyera stock’s recent rally has been its fee-for-service operating structure, which helps it generate more predictable cash flows compared to companies directly exposed to commodity price swings.
In the first quarter, the company posted adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $203 million. Excluding acquisition-related transaction costs tied to the Plains deal, its adjusted EBITDA came in even higher at $232 million.
While Keyera’s distributable cash flow declined on a year-over-year (YoY) basis to $101 million, it continues to maintain a healthy balance sheet. Its net debt-to-adjusted EBITDA ratio remains manageable at 2.2 times. Its recent acquisition of Plains All American Pipeline’s Canadian natural gas liquids (NGL) business significantly expands its infrastructure platform while improving market connectivity and customer reach.
At the same time, the company’s projects like KAPS Zone 4 and KFS Frac III remain on track and on budget, supporting its long-term earnings growth potential.
Manulife Financial stock
My second reliable dividend stock pick takes a more diversified approach, with Manulife Financial (TSX:MFC) offering exposure to insurance and wealth management backed by consistent earnings growth. The company has built a strong global presence while continuing to expand across key markets.
This insurance and wealth management giant currently trades near $51 per share with a market cap of roughly $86 billion. Over the last year, MFC stock has climbed about 16% while offering a quarterly dividend yield of 3.5%.
In its latest quarter, Manulife delivered strong earnings growth despite broader market volatility. The company’s core earnings rose 8% YoY on a constant exchange rate basis to $1.8 billion, while its net profit attributable to shareholders also improved significantly to $1.1 billion. The company’s core return on equity (ROE) reached 16.5% in the latest quarter, reflecting strong profitability.
Beyond financial performance, Manulife continues expanding its health insurance offerings in Asia and Canada while also strengthening its global wealth and asset management business. Moreover, the company is using artificial intelligence (AI) technology to improve efficiency, customer experience, and operational performance across the business — brightening its long-term growth outlook.
