There’s nothing wrong with owning Canadian bank stocks for income, as they have a solid track record of delivering reliable income. But the problem is thinking they’re the only dependable choice on the TSX today. Contrary to that perception, Canada has many other large companies with strong cash flow, long dividend records, and plenty of room to keep rewarding shareholders.
One of them has raised its payout for 26 straight years while also posting powerful share-price gains over the long run. Let’s take a closer look at a Canadian dividend stock that could appeal to investors who want to diversify beyond the big banks.
Canadian Natural stock
If you usually turn to bank stocks for income, Canadian Natural Resources (TSX: CNQ) could be a great TSX dividend stock worth looking at beyond the financial sector.
Headquartered in Calgary, this oil and gas producer has operations spanning Western Canada, the North Sea, and Offshore Africa. CNQ stock currently trades at $66.91 per share, giving the company a market cap of $137.7 billion. At that price, the stock offers a 3.7% annualized dividend yield, paid quarterly.
Its shares have gained 49% over the last year due mainly to its stronger financial growth trends, quality acquisitions, rising production, and favourable synthetic crude oil pricing.
Record results strengthen the dividend case
In the second quarter, the Canadian energy producer delivered record production of about 1.68 million barrels of oil equivalent per day, up 18% year-over-year (YoY). Its liquids production also reached a record 1.25 million barrels per day, reflecting 23% YoY growth.
Strong production and synthetic crude oil pricing also helped Canadian Natural post record adjusted net earnings from operations of nearly $4.6 billion. That was about 205% higher than the roughly $1.5 billion reported a year ago. Meanwhile, its adjusted funds flow more than doubled YoY to a record $6.9 billion, while cash flow from operating activities jumped about 119% to $6.8 billion.
As a result, the business generated nearly $3 billion in free cash flow during the quarter. It returned roughly $2.4 billion directly to shareholders through dividends and share repurchases. Adding to the optimism, Canadian Natural reduced net debt by about $1.6 billion sequentially to $14.5 billion.
Why income investors should keep watching CNQ
For dividend investors, strong cash flows matter because they give the company room to reward shareholders while continuing to invest in future growth. The company recently raised its 2026 production guidance for the second time this year. Canadian Natural now expects average production between 1.637 million and 1.682 million barrels of oil equivalent per day.
Beyond that, the company owns a large base of long-life, low-decline assets, which help it lower the amount of capital needed to maintain output.
Overall, Canadian Natural not only offers a growing dividend, but also backs that payout with strong free cash flow and a disciplined approach to returning capital to shareholders. That’s why I believe income-focused investors willing to look beyond Canada’s big banks will find CNQ an appealing long-term dividend stock.
