Canadian equities have staged a notable recovery in recent months, with the benchmark S&P/TSX Composite Index advancing more than 15% year to date. A combination of firmer commodity prices and improving corporate earnings has bolstered investor sentiment and provided a meaningful tailwind for the broader market. Nevertheless, the investment landscape remains challenging, with persistent inflation and elevated geopolitical and trade tensions continuing to introduce uncertainty and potentially fuel further market volatility.
Against this backdrop, investors may benefit from focusing on high-quality companies that can balance long-term capital appreciation with dependable dividend income. Businesses with resilient fundamentals, sustainable cash flows, and credible growth catalysts can provide both portfolio stability and an opportunity to compound wealth over time. With that in mind, here are two top Canadian stocks that offer an attractive combination of long-term growth potential and reliable dividend income.
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Savaria
My first pick is Savaria (TSX: SIS), which has delivered an impressive 25.9% return year to date and currently pays a monthly dividend of $0.07 per share, translating into a forward yield of approximately 2%. The company provides accessibility and mobility solutions worldwide, supported by a well-diversified manufacturing footprint and extensive distribution network. Earlier this month, Savaria reported a strong second-quarter performance, with revenue and adjusted earnings per share (EPS) increasing by 8.4% and 20.7%, respectively. Organic growth, favourable currency translation, and acquisitions all contributed to the company’s solid performance.
Savaria’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) margin also expanded by 50 basis points to 21.1%, reflecting the positive impact of its “Savaria One” initiative. Meanwhile, strong operating performance enabled the company to further strengthen its balance sheet, with its net debt-to-adjusted EBITDA ratio improving to 0.87 from 1.03 at the end of 2025.
Looking further ahead, Savaria’s long-term growth outlook remains compelling, supported by rising demand for accessibility and mobility solutions as the global population ages. The company is investing in product innovation while pursuing strategic acquisitions to broaden its capabilities, expand its geographic footprint, and unlock additional growth opportunities. As part of its long-term growth strategy, management expects revenue to reach $1.6 billion by 2030, implying an annualized growth rate of 11.8%. It also expects adjusted EBITDA per share to reach $4.25 by 2030, representing an annualized growth rate of 10.4%.
With its solid financial performance, improving balance sheet, favourable demographic tailwinds, and ambitious long-term growth targets, Savaria appears well positioned to reward investors through earnings growth, share-price appreciation, and consistent dividend income in the years ahead.
Hydro One
My second pick is Hydro One (TSX: H), a leading electricity transmission and distribution company serving approximately 1.5 million customers across Ontario. With a regulated asset base and no exposure to power generation, Hydro One’s financial performance is largely insulated from commodity price fluctuations and broader economic cycles. Combined with consistent rate-base growth, this resilient business model has supported strong financial performance and attractive shareholder returns. Over the past five years, the company has generated a total shareholder return of approximately 97%, representing an annualized return of 14.6%. Hydro One has also increased its dividend at an annualized rate of 5.4% since 2017 and currently offers a forward yield of approximately 2.6%.
Looking ahead, Hydro One’s addressable market continues to expand as electricity demand rises alongside economic growth, transportation electrification, and the development of AI-ready data centres across its service territory. To capitalize on these structural growth trends, the company is advancing 15 transmission line projects that are currently at various stages of development and construction. In addition, population growth and ongoing residential development across Ontario could further increase demand for electricity distribution services.
These investments should enable Hydro One to expand its rate base, strengthen its financial performance, and create additional opportunities for long-term share-price appreciation. At the same time, a growing earnings and cash-flow base could support the sustainability of its dividend and provide investors with a reliable source of income. Given its regulated business model, strong historical returns, and favourable long-term demand trends, Hydro One appears well positioned to deliver a compelling combination of growth and income over the years ahead.
