Market volatility could be on the way in the coming months as trade uncertainty and elevated inflation threaten to derail the bull run.
Investors seeking income and long-term total returns are wondering which top TSX dividend stocks might be good to buy on pullbacks for a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) portfolio.
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Canadian Natural Resources
Canadian Natural Resources (TSX:CNQ) trades near $61 at the time of writing compared to $56 last week, but the stock is still down from the 2026 high around $70 it reached in March.
The price of West Texas Intermediate (WTI) oil is back above US$80 per barrel after slipping below US$70 earlier this month. WTI soared above US$110 in early April as the closing of the Strait of Hormuz impacted global oil deliveries.
Ongoing volatility should be expected as the U.S. and Iran continue to announce, and then cancel, agreements to reopen the vital passageway for delivering oil to global buyers. Buy-and-hold investors should ignore the near-term turbulence when considering CNRL as a pick for their portfolios.
The Canadian oil and natural gas giant is benefitting from recently completed pipelines that carry oil and natural gas to the B.C. coast for shipment to international buyers. In recent days, the government has announced a plan to build a new oil pipeline that will follow the existing Trans Mountain route. Additional natural gas pipelines and export facilities are either planned or near completion that will enable CNRL and its peers to ramp up output to meet rising global demand for Canadian energy products.
CNRL says its WTI breakeven level is in the range of US$40 to $45 per barrel, so it is generating healthy profits at current oil prices. The board has increased its dividend annually for the past 26 years. Investors who buy CNQ at the current price can pick up a 4% dividend yield.
Fortis
Fortis (TSX:FTS) is up about 26% in the past year. The rally has pushed the current dividend yield down to about 3%. That’s quite a bit lower than yields investors can get from other dividend stocks, but FTS still deserves to be on your radar.
The utility company has businesses located in both Canada and the United States that generate rate-regulated revenue streams. This cash flow is both reliable and predictable, and is largely recession resistant. A big U.S. presence provides investors with access to the American energy market through a solid Canadian firm.
Fortis continues to expand through its current $28.8 billion capital program that is expected to raise the rate-base from roughly $42 billion to nearly $59 billion over five years. The new assets, when completed, will generate revenue and earnings growth that should comfortably support planned annual dividend increases of 4% to 6% through 2030.
Fortis has increased the dividend in each of the past 52 years. The dividend growth steadily increases the yield on the initial investment.
The bottom line
CNRL and Fortis pay good dividends that should continue to grow. If you have some cash to put to work on a market dip these stocks deserve to be on your radar.
