For Canadian investors seeking regular income, Enbridge (TSX: ENB) and Telus (TSX: T) offer two different approaches to dividend investing. Both operate established businesses, offer high yields, and have attracted income-focused shareholders, but their recent dividend strategies have changed. One continues to prioritize dividend growth, while the other is focusing on financial recovery.
Enbridge has continued to increase its dividend, making it appealing to investors who value a growing income stream. Telus, on the other hand, has taken a different route, cutting its dividend by 55% as it deals with financial pressures.
For Telus shareholders, the reduction means more than simply receiving a smaller dividend cheque. It also signals a shift in the company’s priorities. Rather than focusing on dividend growth, Telus is reducing debt and focusing on improving its balance sheet.
So, how do these two Canadian dividend stocks compare today? Let’s look at their dividend policies, financial positions, and growth prospects to understand which one wins.
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Enbridge builds on its dividend growth record
Enbridge has a long history of rewarding shareholders with reliable dividend payments. Moreover, it has raised its annual payout every year since 1995. Going forward, dividend growth could remain in the low- to mid-single-digit range, supported by rising earnings and distributable cash flow (DCF) per share.
The energy infrastructure firm’s highly diversified revenue stream supports its payouts. Its operations include liquids pipelines, natural gas infrastructure, gas utilities, and renewable energy. This helps generate solid earnings across all market conditions. Moreover, its operating structure adds resilience. Most of ENB’s earnings come from regulated operations and long-term contracts, providing predictable cash flow and limiting exposure to commodity price swings.
Enbridge also targets a dividend payout ratio of around 60% to 70% of DCF, rewarding shareholders while retaining funds for future growth.
Additionally, the company’s $41 billion secured capital backlog provides opportunities to expand its operations and strengthen earnings over time. Overall, Enbridge appears well positioned to grow cash flow and earnings at a mid-single-digit pace over the medium term, supporting further dividend increases.
Telus unlikely to resume dividend growth anytime soon
Telus is unlikely to resume dividend increases in the near term as it prioritizes debt reduction and is taking a more cautious approach to capital spending. The telecommunications company has lowered its dividend payout target from 60%–75% to 45%–60%, giving it more financial flexibility to manage uncertainty.
The dividend reduction is expected to free up approximately $2.7 billion through 2028, which Telus plans to use to strengthen its balance sheet. Its goal is to bring the net debt-to-adjusted EBITDA ratio down to around 3 times or less by 2028, from 3.5 times in the second quarter of 2026.
Telus is also looking to sell non-core assets to generate additional cash. Meanwhile, customer growth, strong retention, and cost-cutting efforts could help support earnings. The company continues to prioritize investments in wireless services, PureFibre, and digital and AI infrastructure.
Overall, disciplined spending, lower capital requirements, and a reduced payout ratio could improve Telus’s financial position, accelerate debt repayment, and provide a more sustainable foundation for its dividend.
Which dividend stock wins?
Enbridge appears to be the stronger dividend stock for income-focused investors, thanks to consistent dividend growth, diversified cash flows, and a solid growth pipeline. Telus’s lower payout ratio and focus on strengthening its balance sheet add stability, but its dividend growth prospects remain limited in the near term.
Overall, investors seeking reliable, growing income could consider Enbridge stock.
