The Canadian Companies That’ve Been Quietly Raising Their Dividend Payouts

Long-term investors should have these three dividend growers on their watchlist for potential buys on market corrections.

Kay Ng

Author Bio

Kay graduated from the University of British Columbia with a Bachelor of Science in Computer Science and furthered her studies in financial markets, finance, and financial accounting. She began investing in dividend stocks in 2008, turning an early interest into a lasting passion. Over the years, Kay has refined her investment approach to focus on high-quality businesses, using fundamental analysis and valuation to identify long-term investment opportunities. Her investment research and articles have been featured in The Motley Fool, Sure Dividend, and Seeking Alpha. Outside of investing, Kay enjoys playing the piano, from popular songs learned by ear to challenging classical compositions. Her favourites include Fantaisie-Impromptu by Frédéric Chopin and La Campanella by Franz Liszt.

Education

Bachelor of Science (BSc) in Computer Science, University of British Columbia Further studies in financial markets, finance, and financial accounting

Areas of Expertise

Dividend stocks, fundamental analysis, company valuation, quality investing, long-term investing, business fundamentals, and identifying investment opportunities in high-quality companies.

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Favorite Investment Quotes

“The best way to measure your investing success is not by whether you’re beating the market but by whether you’ve put in place a financial plan and a behavioral discipline that are likely to get you where you want to go.” — Benjamin Graham “A market downturn doesn’t bother us. It is an opportunity to increase our ownership of great companies with great management at good prices.” — Warren Buffett

Published June 24, 4:00 pm EDT

Many Canadian investors are familiar with dividend-growth giants such as Fortis, which has increased its dividend for decades. However, some lesser-known dividend growers have been quietly rewarding shareholders with consistent payout increases over the past decade. While their streaks may not attract as much attention, these companies combine stable businesses, growing cash flows, and a demonstrated commitment to returning capital to investors.

For long-term investors, these dividend growers deserve to be on your watchlist.

dividends can compound over time — Source: Getty Images

Hydro One

Hydro One (TSX: H) is Ontario’s largest electricity transmission and distribution provider. As a regulated utility, it enjoys predictable revenue streams and relatively stable earnings, making it well-positioned to support ongoing dividend increases.

The company operates essential electricity infrastructure that serves customers across the province. Beyond its core utility operations, Hydro One also has exposure to telecommunications assets and electric vehicle charging initiatives, providing additional long-term growth opportunities.

Hydro One began raising its dividend annually in 2017 and has maintained that momentum ever since. Its five-year dividend growth rate of approximately 5.6% demonstrates management’s confidence in the company’s earnings outlook and cash-generating ability.

Although the stock currently offers a modest yield of about 2.4%, investors are paying for quality and stability. Shares trade near fair value, meaning patient investors may want to wait for a broader market correction before initiating or adding to a position. Nevertheless, Hydro One remains a solid idea for conservative investors’ watchlists.

Power Corp.

Power Corp. (TSX: POW) provides investors with exposure to a diversified portfolio of financial services and investment businesses. Its holdings include controlling stakes in Great-West Lifeco and IGM Financial, as well as interests in alternative asset managers and the rapidly growing digital wealth platform Wealthsimple.

This diversified structure helps reduce risk while creating multiple avenues for earnings growth. As Canada’s wealth management and retirement markets continue to expand, Power Corp. is well positioned to benefit from long-term industry trends.

The company started increasing its dividend in 2015 and has delivered an impressive 10-year dividend growth rate of roughly 7.2%. Combined with a current yield near 3%, Power Corporation offers a balance of income and growth.

Trading close to analyst estimates of fair value, the stock may not be a bargain today. However, investors looking for a high-quality financial stock with a proven commitment to dividend growth may find it worthy of long-term consideration.

TMX Group

TMX Group (TSX: X) operates some of Canada’s most important financial market infrastructure, including the Toronto Stock Exchange and the TSX Venture Exchange. The company also manages derivatives markets, clearing operations, depository services, and valuable market-data businesses.

TMX would benefit from increased market activity and growing demand for financial data and analytics. These businesses often generate recurring revenue and can deliver attractive operating leverage over time.

Since beginning its dividend growth streak in 2016, TMX has increased its payout at a remarkable 10-year growth rate of approximately 10.1%. While its current yield of about 1.9% is relatively low, the company’s strong dividend growth record can significantly boost investors’ income over the long run.

Following a recent share-price pullback, TMX Group may offer a compelling entry point for investors seeking a combination of quality, growth, and rising dividends.

Investor takeaway

Hydro One, Power Corporation, and TMX Group may not receive the same attention as Canada’s dividend-growth legends, but each has quietly built a strong record of increasing shareholder payouts. Supported by resilient businesses and solid long-term growth prospects, these companies could be worthwhile additions for investors seeking a growing stream of dividend income for years to come, especially on market dips.