This Stock Belongs in Every Canadian’s TFSA, and Here’s Why

With a yield of 5.5% and 15 straight years of dividend increases, this TSX stock is a no-brainer buy in every Canadian’s TFSA.

Key Points
  • Balanced Growth and Income Potential: Brookfield Renewable Partners (TSX:BEP.UN) is a top choice for TFSA investments due to its dual focus on growth and income, supported by significant cash flow from global renewable assets and a 5.5% yield.
  • Strong Position in Renewable Energy: With 49 gigawatts of operational capacity and over 200 gigawatts in development, Brookfield leads in renewable energy with long-term agreements, reducing risk and providing predictable earnings.
  • Superior Investment for Long-term TFSA Gains: Brookfield offers exposure to the growing demand for renewable energy and electricity with its large-scale assets and consistent dividend growth, making it ideal for compounding tax-free growth in a TFSA.

It’s no secret that a high yield can be appealing when you’re choosing Canadian stocks for your TFSA.

However, even if you prioritize income, the best long-term investments offer more than just income today.

In fact, the highest-quality TSX stocks almost always do both. They’re often among the most defensive and durable companies while constantly finding new ways to grow, which gives them more opportunities to pay you more over time.

And while these stocks are the highest-quality picks for a reason, they’re especially valuable in a TFSA, where you can let those investments grow and compound tax-free for decades.

That’s why Brookfield Renewable Partners (TSX: BEP.UN) is undoubtedly one of the best Canadian stocks to buy in your TFSA.

Whether you’re looking for growth or income, Brookfield offers both, not to mention an experienced management team with a strong track record of building and buying power assets in an industry with massive long-term potential.

A lake in the shape of a solar, wind and energy storage system in the middle of a lush forest as a metaphor for the concept of clean and organic renewable energy.

Source: Getty Images

A renewable power business with room to grow

Brookfield isn’t a typical green energy stock either. It’s a massive business with operations all over the world and roughly 49 gigawatts of operating capacity across hydroelectric, wind, solar and storage assets.

Those assets already generate significant cash flow to support its distribution, while Brookfield still has several ways to expand as electricity demand grows.

Another advantage of Brookfield is that much of its power is sold under long-term agreements. That not only helps reduce risk but also gives the company a better idea of what it will earn from those assets in the years ahead, making its future cash flow more predictable.

That matters when Brookfield is deciding where to invest, especially since building and acquiring power assets requires significant capital.

Plus, Brookfield is already well-positioned to capitalize on the rapidly growing demand for electricity. For example, its hydroelectric assets could become particularly valuable as demand grows. Data centres need reliable electricity all day, not just when the sun is shining or the wind is blowing. 

For example, Brookfield already has a framework agreement with Google to deliver up to 3,000 megawatts of hydro capacity in the United States, showing why those assets are so useful to major customers.

Furthermore, Brookfield also has more than 200 gigawatts of potential new projects in its development pipeline.

And it’s already turning some of those opportunities into operating assets. In the first half of 2026, the company brought roughly 3.1 gigawatts of new capacity online. So, it’s no surprise Brookfield continues to be one of the best dividend-growth stocks on the TSX.

Why every Canadian should consider the stock for their TFSA

There’s no question that renewable energy is an industry with years of growth potential. But even beyond the growth potential of clean energy, Brookfield also benefits from the broader need for more electricity, regardless of what’s driving that demand.

Furthermore, not only does Brookfield offer exposure to the growing demand for power and clean energy, but it’s also one of the industry’s leaders.

Building major power projects takes a tonne of money, and Brookfield’s size and access to capital help it pursue opportunities that smaller companies may struggle to take on. It can also invest alongside other Brookfield funds when a particularly large deal comes up.

Additionally, you’re not waiting for those future projects to make the stock worthwhile. That’s because Brookfield currently offers a yield of roughly 5.5% and has increased its distribution by at least 5% every year since going public in 2011.

So, you’re already generating considerable passive income from a business with decades of potential that has shown it can continue to pay you more over time.

That’s why Brookfield Renewable is a stock every Canadian should consider. Investing is all about personal preference, and there aren’t many stocks that are a universal fit for everyone. 

But given its size, track record, long-term potential and defensive operations, Brookfield is easily one of the best stocks Canadians can buy and hold in a TFSA for years to come.

Fool contributor Daniel Da Costa has positions in Brookfield Corporation. The Motley Fool has positions in and recommends Brookfield Corporation. The Motley Fool recommends Alphabet and Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

More on Dividend Stocks

a-developer-typing-lines-of-ai-code-while-viewing-multiple-computer-monitors
Dividend Stocks

Thomson Reuters Is a Sneaky AI Play, and Its Stock Popped Earlier This Month

Thomson Reuters is an AI play, building AI into tools legal and tax professionals already use. See why TRI stock…

Read more »

woman looks ahead of her over water
Dividend Stocks

1 Move That Could Ease Your Retirement Worries

Holding the Vanguard FTSE Canadian High Yield ETF (TSX:VDY) in a TFSA can help you pay for your retirement.

Read more »

jar with coins and plant
Dividend Stocks

The Small Dividend Today That Could Grow Significanlty in 20 Years

A small 1.6% yield may not look exciting today, but this Canadian stock’s growing earnings, rising dividend, and long-term investments…

Read more »

dividends grow over time
Dividend Stocks

For Both Income and Growth, Consider Canadian Natural Resources and AltaGas stocks

If you want an attractive combination of growth and income, Canadian Natural Resources and AltaGas are the ideal stocks to…

Read more »

Colored pins on calendar showing a month
Dividend Stocks

Here’s What $1,000 in the Right Stocks Could Pay You Every Month

Allocating $1,000 each into these 3 Canadian monthly dividend stocks could generate $200 in recurring passive income at an average…

Read more »

truck transport on highway
Dividend Stocks

1 of the Best Canadian Stocks You’ve Probably Never Heard Of

TFI International may be one of the best Canadian stocks you’ve overlooked. Here’s how its freight network earns money and…

Read more »

Two seniors walk in the forest
Dividend Stocks

5 TSX Stocks to Buy With $50,000 for Retirement Income

Five top TSX dividend stocks could turn $50,000 into roughly $2,400 a year of retirement income. Here is the story…

Read more »

A worker overlooks an oil refinery plant.
Dividend Stocks

Here’s the 4.3% Dividend Stock I Keep Coming Back To

This 4%+ yield dividend stock is a compelling pick for income and growth albeit with typical asset-manager risks.

Read more »