There’s no shortage of great TSX dividend stocks for long-term investors. Investing in the right income-producing stocks today can provide decades of compounding for investors, provided the right investments are selected.
Those stocks are often companies that generate stable cash flows and have long records of paying dividends across different market conditions.
Picking the right investments becomes even more important once investors hit retirement. At that point, generating income and preserving capital becomes the priority.
Here’s a look at three TSX dividend stocks that retirees could buy today and comfortably hold for the next decade.
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Canadian Utilities offers unmatched dividend consistency
Canadian Utilities (TSX: CU) is one of the first stocks for retirees to consider. For those unfamiliar with the company, Canadian Utilities is a utility stock that provides electricity and natural gas services to customers in Canada, Australia and Puerto Rico.
Regulated utility service provides the company with predictable revenue and cash flows. That consistency lets the company invest in growth initiatives and pay a handsome quarterly dividend.
As of the time of writing, that dividend carries a yield of 3.5%, but that’s not even the best part.
Canadian Utilities has the longest dividend-growth streak in Canada, with 54 consecutive annual increases. This factor alone makes the utility stock one of the TSX dividend stocks to own in any portfolio.
For retirees, the appeal in owning Canadian Utilities is simple. The company is a predictable business that generates a recurring, defensive revenue stream with decades of annual increases.
Canadian Natural Resources combines income with dividend growth
Another one of the TSX dividend stocks for investors to consider is Canadian Natural Resources (TSX: CNQ).
Calgary-based Canadian Natural Resources is a producer of oil and natural gas. The company has operations in Canada, as well as in the North Sea and Offshore Africa.
While that does provide some long-term growth potential, oil and natural gas prices can fluctuate significantly, meaning that there’s potential for market volatility to impact the stock.
For retirees taking a longer-term view, those commodity cycles are less important than the company’s ability to keep generating cash and growing its dividend over time.
What makes Canadian Natural Resources attractive is the quality and scale of its operations. The company’s assets are long-life, slow-decline assets that generate significant cash flow.
And it’s that cash flow that has helped the company build an impressive dividend-growth record. As of the time of writing, Canadian Natural Resources has provided investors with 26 consecutive years of increases.
The company offers a quarterly dividend that carries a yield of 3.7%.
For retirees specifically, Canadian Natural Resources represents a way to invest in a strong dividend-growth stock that’s backed by a large, stable asset base.
TD brings banking strength to a retirement portfolio
The last of the three TSX dividend stocks to consider is Toronto-Dominion Bank (TSX: TD).
Canada’s big bank stocks are almost always among the best long-term options to consider. They offer reliable earnings backed by a mature, defensive market in Canada. That domestic stability is balanced with a growing international presence that helps to support a growing dividend.
In the case of TD, the bank is the second largest of the big banks and a key part of the Canadian economy. Apart from its core Canadian operation, TD offers wealth management, insurance, wholesale banking and a growing presence in the U.S. market.
Turning to income, TD offers a quarterly dividend with a yield of 2.7% as of the time of writing. TD has provided investors with upticks to that dividend for over a decade but has paid dividends without fail for well over a century.
Over a decade-long holding period, that combination of stable earnings and dividend growth can provide retirees with an income stream that has the potential to keep up with rising costs.
This makes it an ideal component in a portfolio for retirees looking to generate income.
These 3 TSX dividend stocks can provide income for retirees
No stock, even the most defensive, is without risk. Fortunately, the trio of TSX dividend stocks mentioned above offer some defensive appeal in addition to growth and income-earning capabilities.
In my opinion, one or all of the above should be core holdings in any larger, well-diversified portfolio.
Buy them, hold them, and watch your retirement income grow.
