Dividend stocks are excellent long-term investments, offering investors the potential for both capital appreciation and a steady stream of income. By reinvesting dividends, investors can further enhance returns through compounding. In addition, companies that consistently pay dividends typically have well-established business models and stable cash flows, making their stocks more resilient during periods of market volatility.
With that in mind, here are two high-quality Canadian dividend stocks that offer attractive buying opportunities for investors with five-year or longer investment horizons.
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TC Energy
TC Energy (TSX: TRP) is a leading energy infrastructure company with an extensive natural gas pipeline network and a portfolio of power-generating assets totaling 4.7 gigawatts of capacity. Its highly regulated business model generates approximately 98% of EBITDA (earnings before interest, taxes, depreciation, and amortization) from long-term contracts and rate-regulated frameworks, making its earnings largely insulated from commodity price fluctuations, economic cycles, and broader macroeconomic headwinds. Supported by these stable cash flows, TC Energy has increased its dividend for 26 consecutive years and currently offers an attractive forward dividend yield of 3.63%.
Looking ahead, rising natural gas production across North America is driving demand for TC Energy’s infrastructure and services. To capitalize on this trend, the company plans to invest $6 billion to $7 billion annually to expand its asset base, extend the life of existing assets, increase system capacity, and maintain the safety and reliability of its operations. Along with these expansion initiatives, it is working to leverage commercial and technological innovation to boost efficiency and drive profitability.
Backed by these growth investments, management expects adjusted EBITDA to reach $12.6 billion to $13.1 billion by 2028, with the midpoint implying an annualized growth rate of 5.4%. At the same time, TC Energy continues to strengthen its balance sheet, targeting a long-term net debt-to-EBITDA ratio of 4.75 times. With a resilient business model, visible earnings growth, and plans to increase its dividend by 3% to 5% annually, TC Energy remains an excellent long-term investment for income-focused investors.
Bank of Nova Scotia
Another quality dividend stock offering an attractive buying opportunity is Bank of Nova Scotia (TSX: BNS), one of Canada’s largest financial institutions. The bank provides a broad range of financial services across North America, Latin America, and other international markets, generating diversified and recurring revenue streams that support stable earnings and robust cash flows. Backed by this resilient business model, Scotiabank has paid dividends continuously since 1833, increased its dividend at a 4.5% annualized rate over the past decade, and currently offers an attractive forward dividend yield of 3.73%.
Looking ahead, Scotiabank is repositioning its business by expanding its presence in North America while reducing its exposure to lower-return and higher-risk markets in Latin America. This strategic shift could improve the quality and consistency of its earnings. As part of this effort, the bank announced in May an agreement to acquire MapleMark Bank, strengthening its U.S. presence, particularly in the fast-growing Dallas market. It is also seeking to acquire the remaining shares of Scotia Group Jamaica Limited, a move that could enhance capital allocation and improve operational efficiency across its existing operations.
In addition, Scotiabank stands to benefit if interest rates remain elevated, as higher lending margins could support its core lending business. The bank has also launched a share repurchase program of up to 15 million shares, which will reduce its outstanding share count by approximately 1.2% and enhance shareholder value. Supported by its resilient business model, consistent cash flow generation, long history of dividend growth, and improving long-term growth prospects, I believe Scotiabank is an excellent buy for long-term income-focused investors.
