For passive-income seekers, the best dividend stocks offer more than just attractive yields. The top long-term holdings are backed by resilient business models, predictable cash flows, consistent earnings growth, and a proven commitment to rewarding shareholders across economic cycles.
While a high dividend yield can boost portfolio income, its sustainability is equally important. TSX stocks that generate stable cash flows and maintain disciplined capital allocation are better positioned to continue increasing payouts over time.
Against this backdrop, Enbridge (TSX:ENB) stands out as a compelling option. The energy infrastructure company offers a dividend yield of more than 5%, generates resilient cash flows, and has an exceptional record of dividend growth.
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A resilient business model supporting dividend payouts
Enbridge is one of Canada’s most dependable dividend-paying companies. It has paid dividends for more than 70 years and has increased its distributions annually since 1995. The solid payment history highlights management’s commitment to returning capital to shareholders.
Enbridge’s ability to sustain and grow its dividend stems from its highly resilient business model. It benefits from a diversified portfolio spanning liquids pipelines, natural gas infrastructure, gas utilities, and renewable power assets. This diversification reduces reliance on any single business segment and positions the company to benefit from rising long-term energy demand.
Nearly all of Enbridge’s earnings before interest, taxes, depreciation, and amortization (EBITDA) come from regulated businesses or long-term take-or-pay contracts. These contractual arrangements significantly reduce exposure to fluctuations in oil and natural gas prices, allowing the company to generate stable revenue and dependable cash flows even during periods of energy market volatility.
Thanks to its resilient distributable cash flow (DCF), Enbridge consistently rewards shareholders with higher payouts.
Enbridge maintains a sustainable payout ratio
Beyond its resilient operations, Enbridge follows a disciplined capital allocation strategy. Enbridge targets a dividend payout ratio of 60% to 70% of DCF. The target payout ratio is sustainable and helps Enbridge reward shareholders while retaining sufficient capital to support expansion, strengthen its balance sheet, and maintain financial flexibility.
Enbridge’s growth drivers support future dividend increases
Enbridge’s prospects remain solid and will likely support future dividend growth. For 2026, management expects adjusted earnings per share (EPS) to increase by 4% to 6%, reflecting the resilience of its regulated and contracted operations.
Looking beyond 2026, the company forecasts annual growth of approximately 5% in adjusted EBITDA, adjusted EPS, and DCF per share, supported by new projects entering service and its high-quality asset base.
A key catalyst is Enbridge’s secured capital project backlog, valued at approximately $39 billion. Since regulated frameworks or long-term commercial agreements back these projects, they offer strong earnings visibility while limiting execution risk. At the same time, the company’s highly utilized liquids pipeline network is expected to continue generating stable, predictable cash flows.
Enbridge is also investing in high-return expansion projects that leverage its existing infrastructure, allowing it to grow efficiently while controlling capital costs. Beyond traditional energy infrastructure, the company is well-positioned to benefit from data centre expansion, increasing natural gas consumption, and continued investment in renewable energy.
The bottom line
Enbridge is a reliable dividend stock for passive-income seekers. Its attractive yield, resilient cash flows, disciplined capital allocation, and solid growth prospects position it well to keep returning cash to its shareholders.
