The big data centre buildout has taken a U-turn amidst growing concerns around hyperscalers’ binge borrowing. While there were many warning signs, Meta Platforms’ (NASDAQ: META) plans to create a new class of non-voting shares to fund artificial intelligence (AI) investments triggered a sell-off in AI stocks.

While AI investments are showing revenue and profits, the sheer amount of capital going into it and the depreciation that comes with it have worried capital markets. Meta’s five-year credit default swaps were trading at record highs on October 23, 2026, according to a Reuters article. This brings back flashes of the dot-com bubble and the 2008 Global Financial Crisis. Central banks in Asia have already hiked interest rates to curb inflation. If the US Fed increases interest rates by 25 or 50 basis points, the massive AI debt will trigger a huge interest cost.

Beware of the big data centre buildout

A Gartner report warned that AI infrastructure investments are at risk of a US$4 trillion asset write-down through 2032. The concerns are valid. Unlike oil and gas pipelines, AI infrastructure depreciates rapidly. Those who have used graphics processing units (GPUs) know this. Considering the amount of capex announced for AI infrastructure through 2030, AI data centre owners would need US$8.5 trillion in revenue by 2030 to meet capex, financing costs, and a 12% return on invested capital (ROIC). Gartner does not see AI revenue crossing US$3.6 trillion by 2030.

The problem is the ticking time bomb of infrastructure upgrades. If AI data centres fail to generate sufficient revenue, raising new debt will be difficult, and outdated infrastructure won’t fetch desired revenue. Hence, when hyperscalers like Meta call for more capital, investors are giving it a second thought.

While one side of the coin raises concerns of an AI bubble burst, the other side of the coin states that AI is here to stay. What if the fears are a pullback before another rally? A good strategy is to invest in both sides of the coin.

Hammond Power Solutions is positioned for the big data centre buildout

If you believe that the AI data centre setback is temporary and another wave of investment is coming, Hammond Power Solutions (TSX:HPS) is a good stock. It builds transformers for electrification and electrical distribution networks. It has a strong order book as demand for AI-focused data centre transformers picked up in the U.S. and Mexico. The Canadian demand fell due to timing.

HPS’ stock price fell 37% between June 22 and September 1 when fears of cooling AI investment surfaced. It recovered 37% between September 2 and October 5 and fell again by 31% in October. The gap between the two dips is narrowing, showing growing investor apprehension. Even though order backlog has almost doubled year-over-year, investors have already priced in that order book. For HPS stock to grow further, AI investments have to pick up. Now is a good opportunity to buy the dip if you are bullish on the data centre buildout.

Constellation Software is positioned for the big data centre fallout

Being optimistic is one thing, but hedging your downside risk is another. As an investor, you have to look at all possibilities and diversify your money in investments that look promising.

Constellation Software (TSX: CSU) is well-positioned to benefit from the AI slowdown and offer contrarian growth. It is a software holdings company, with a portfolio of thousands of software across 100-plus verticals serving niche demands of mission-critical applications. Unlike AI data centre companies, it is not burning budget on AI migration. However, it isn’t ignoring AI either. Constellation’s operating companies are testing AI at their level. If AI investments stall or pull back, Constellation stock surges, as seen in its October rally of 16%.

Constellation continues to enjoy strong free cash flow growth from new acquisitions. Unlike Meta, Constellation has contained its balance sheet debt and is using free cash flow to make new acquisitions. Since the AI boom pulled down software stocks, it acquired stakes in some good software companies at a discount.

Investor takeaway

The contrarian stock price movement of HPS and CSU to AI investing makes them a perfect fit for a balanced portfolio.

The post Hammond Power Solutions Is Positioned for the Big Data Centre Buildout: Here’s How I’d Buy It appeared first on The Motley Fool Canada.

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The Motley Fool has positions in and recommends Constellation Software and Hammond Power Solutions. The Motley Fool recommends Meta Platforms. The Motley Fool has a disclosure policy. Fool contributor Puja Tayal has no position in any of the stocks mentioned.

Ever wondered why we always talk about an ideal TFSA stock? What is so different about a Tax-Free Savings Account (TFSA) that matching the right stock with its benefits could amplify returns?  A TFSA is not a normal savings account. It allows you to invest in stocks, bonds, and ETFs listed on public exchanges. Your investment grows tax-free, and you can even withdraw tax-free, without specifying a reason.

Suppose you take payouts from your TFSA in a particular year. You can reinvest those withdrawals in the following tax year without losing your TFSA contribution room. In a Registered Retirement Savings Plan (RRSP), your withdrawals are taxed unless they are under a specific plan, like a home purchase or higher education. You cannot reinvest the money withdrawn for any other reason, which means you will lose your RRSP contribution room forever.

Why monthly dividend stocks are an ideal TFSA pick

Let’s take a hypothetical situation. Amy has been building a passive income portfolio for a long time. By now, that portfolio is fetching her $100 a month. A sudden house repair created an expense shortfall beyond her emergency fund. She can access TFSA investments and take dividend payouts or sell some of her profitable shares and withdraw that amount. None of this amount will be added to her taxable income. In fact, her TFSA withdrawals this year will be added back to her TFSA contribution room on January 1, 2027.

In an RRSP, the same $100 would face a 10% withholding tax, and the remaining $90 would be added to Amy’s taxable income. Moreover, she would lose her RRSP contribution room. Thus, monthly dividend stocks are ideal for a TFSA.

An ideal TFSA stock for October

Granite REIT (GRT.UN) is an ideal TFSA stock for October, as the REIT dips to its seasonal low. Granite REIT has a portfolio of warehouses and storage facilities. Around 71% of its portfolio (by value) is e-commerce distribution centres spread across six countries in North America and Europe. Considering that the holiday season sale begins in November, manufacturers’ and e-commerce companies’ inventory starts falling, leading to lease renewals.

The REIT’s unit price has dipped 13% from its July 20 high of over $99, increasing the annual dividend yield to 4.2%. What’s unique about this REIT is that it grows its dividend every January at an average annual rate of 3%. Moreover, the REIT’s unit price hovers in the range of $65–$80. In some peak years, the unit price goes up to $100.

Most REITs’ unit prices are not volatile, but Granite REIT’s is because it actively buys and sells property to meet the changing storage demand. Even now, it has assets held for sale. You can use this volatility to accumulate units when the price dips.

You could also consider booking profit on one-off gains where the unit price touches $100. Otherwise, a $65 to $80 price is ideal to accumulate units.

This stock pays 0.34% per month

Granite REIT’s dividend is safe because it maintains a conservative debt profile. Its total debt is 37.3% of its property portfolio. Moreover, it has five times operating profit to cover interest costs. This shows Granite can comfortably absorb interest rate hikes without affecting profits.

As for dividends, here again its distributions are 65% of its adjusted funds from operations (AFFO), giving it sufficient financial flexibility to tackle inflation. It has grown its dividends annually for 15 consecutive years and can continue doing so.

As the 4.2% yield is paid in 12 monthly installments, you get 0.34% every month. So if you invest $10,000 today, you can buy 115 units and get $34 on November 16, 2026. This amount will likely increase by 3–4% in January 2027.

The TFSA will make these withdrawals tax-free. You can either take the payout or reinvest the dividend amount to buy Freehold Royalties, which pays a 6.2% annual dividend yield.

The post An Ideal TFSA Stock for October, Paying 0.34% Each Month appeared first on The Motley Fool Canada.

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Fool contributor Puja Tayal has no position in any of the stocks mentioned.  The Motley Fool recommends Freehold Royalties and Granite Real Estate Investment Trust. The Motley Fool has a disclosure policy.

Searching for a reliable monthly passive income can be quite an adventure. Finding yields high enough to matter without taking on unacceptable financial risk is the ultimate goal. While high-yield dividend stocks can sometimes trap investors with unsustainable payouts, certain real estate investment trusts (REITs) offer the perfect balance of yield, safety, and operational durability. Crombie Real Estate Investment Trust (TSX: CRR.UN) could be the top-notch monthly dividend stock one could buy to earn a 5.5% yield in retirement.

Essential retail anchors drive high occupancy

Crombie REIT owns a portfolio of 310 high-quality, predominantly retail properties comprising roughly 19.4 million square feet of gross leasable area (GLA). The portfolio’s heavy concentration in necessity-based retail space is what makes it a particularly compelling passive income investment for Canadian retirees. Rather than relying on discretionary shopping malls or vulnerable fashion retailers, Crombie’s cash flow is anchored by grocery stores, pharmacies, and essential service providers – the kind of tenants that retain foot traffic even during economic downturns.

The retail REIT saw portfolio occupancy remain near all-time highs at 97.5% going into the third quarter. Its stability is traceable back to its close relationship with its former parent company, Empire Company Limited, the grocery giant behind national chains like Sobeys, Safeway, IGA, FreshCo, and Farm Boy. Empire remains Crombie’s majority unit holder and principal tenant, generating approximately 55% of the REIT’s annual minimum rent.

A conservative payout ratio protects the 5.5% yield

Most noteworthy for passive income seekers, Crombie’s monthly distribution of $0.08 per unit is well covered by distributable cash flow. During the first half of 2026, Crombie reported an Adjusted Funds From Operations (AFFO) payout ratio of 77.2%. This implies the REIT retained nearly 23% of its distributable cash flow to manage debt and develop the portfolio. Crombie’s low and sustainable payout rate provides a comfortable margin of safety for income investors.

That retained capital allows the REIT to fund property improvements and debt reduction internally rather than stretching its balance sheet with debt. Supported by recent steady mid-single-digit net operating income (NOI) growth and strong rental renewal rate increases exceeding 11% during the second quarter, management has rewardingly increased distributions in two consecutive years now.

Long-term growth beyond monthly rent cheques

Looking ahead, Crombie offers investors more than just a static stream of monthly rent cheques. The trust possesses a valuable growth driver in its urban mixed-use development pipeline. Crombie is creating new recurring income streams on land it already owns by converting underutilized land and parking space around existing, transit-connected grocery sites into modern residential apartments and commercial hubs. Furthermore, built-in contractual rent escalators ensure that top-line revenue rises steadily alongside inflation.

Key risks every income investor should monitor

Every income investment carries trade-offs that dividend investors must evaluate. Crombie’s primary concentration risk stems from its high revenue exposure to Empire Company. However, given Empire’s strong credit profile, market position, and essential status in Canadian society, the probability of tenant default remains low. Additionally, elevated interest rates continue to apply pressure across the broader real estate sector, making disciplined balance sheet management vital.

Should you buy Crombie REIT for monthly passive income?

Retirees looking to replace a traditional employment paycheque with dependable, monthly passive cash flow will find that Crombie REIT checks all the right boxes. Its stable 5.5% yield, a conservative payout ratio below 78%, recession-resistant grocery anchors, and a clear path toward long-term value creation qualify it for a prominent spot in any Canadian retirement investment plan.

The post A Top-Notch 5.5% Dividend Stock Paying Cash Every Month in Retirement appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

CT Real Estate Investment Trust (TSX: CRT.UN) is back on Canadian income investors’ watch lists as it prepares to release third quarter earnings results after markets close on November 9. The retail property landlord has been a favourite monthly dividend stock for many passive income seekers over the past decade. Stellar portfolio metrics, sector leading financial prowess, and 13 consecutive years of management’s proven commitment to increase payouts to investors make the real estate investment trust (REIT) a top-tier monthly dividend stock to hold for decent (and growing) yields. Here’s why I’d recommend a Buy on CT REIT before earnings next month.

Thirteen years of monthly income raises

In May, CT REIT announced its 13th distribution increase since its 2013 initial public offering (IPO), a 3.5% raise effective with the July 2026 payment. Cumulative distribution growth now exceeds 50%. Among Canadian REITs, only Granite Real Estate Investment Trust has a longer dividend growth streak of 15 years. CT REIT sits at number two on a list of dividend growth stocks in its asset class. It ranks ahead of Morguard North American Residential Real Estate Investment Trust (four years), RioCan Real Estate Investment Trust (four years), and Choice Properties Real Estate Investment Trust, which clocked three consecutive years of distribution raises this year.

CT REIT’s current monthly distribution at $0.08 per unit should yield about 5.5% annually for new investors buying into the top-tier monthly dividend stock today for future passive income.

CT REIT’s payout ratio tells a soothing story

A high distribution yield often means little if the payout is stretched, threatening the passive income stream’s sustainability. CT REIT’s payout ratio on its adjusted funds from operations (AFFO) came in at 72.5% for the first half of 2026, an improvement from 72.9% during the same period last year.

AFFO measures a REIT’s most recurring distributable cash flow after property maintenance and leasing costs. CT REIT retains nearly 30% of distributable cash flow to invest in expanding its real estate portfolio. That’s a comfortable cushion for a REIT with near-full occupancy (99.6%) and contractual rent escalators built into its leases.

Among Canadian retail REITs that report AFFO payout rates, only Primaris REIT has a lower historical AFFO payout ratio among retail peers, but its yield is just 4% – well below what a monthly income seeker may need. CT REIT offers a potentially best combination of a 5%-plus yield and a sub-75% payout ratio in the Canadian retail REIT sector.

Why CT REIT’s monthly dividend could be durable

CT REIT’s portfolio is anchored by Canadian Tire (TSX: CTC.A) locations (its former parent, and majority equity holder), with occupancy at 99.5% and a long-weighted average lease term of 7.2 years. Leases carry built-in annual rent escalations, providing predictable organic net operating income (NOI) growth without relying on acquisitions.

The REIT’s development pipeline adds another layer. Going into the third quarter, CT REIT had nine active projects representing approximately $354 million in committed investment, with 94.2% pre-leased. The trust has this future cash flow already contracted before the buildings open.

Some notable risk you must accept

Concentration risk can’t be ignored. CT REIT’s fortunes are tied to Canadian Tire, which occupies 92% of its portfolio’s leasable area. If the retailer stumbles, the REIT definitely feels it. That said, Canadian Tire has maintained an investment-grade credit rating for years – a testament to its strong financial performance. It’s not likely to start defaulting on its rent obligations any time soon.

Foolish bottom line

Investors who want a monthly dividend stock paying more than a 5.5% yield, a conservative payout ratio, and a management team that appears committed to raising distributions every single year may shortlist CT REIT right now. It won’t make one rich overnight, but it will pay you cash every month for years to come, and most probably raise the paycheque every year.

The post A Top-Tier 5.5% Dividend Stock That Pays Cash Every Month appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool recommends Granite Real Estate Investment Trust, Morguard North American Residential Real Estate Investment Trust, and Primaris Real Estate Investment Trust. The Motley Fool has a disclosure policy.

If you’re still punching the clock but already dreaming about a retirement paycheque that arrives every month without you lifting a finger, RioCan Real Estate Investment Trust (TSX: REI.UN) deserves a spot on your watchlist.

The Canadian retail REIT currently pays a monthly distribution of 9.7 cents per unit, which works out to roughly 5.4% annually at recent prices. That monthly income distribution is genuinely appealing for investors building a passive income retirement portfolio. It lines up with bills in a way quarterly dividends can’t easily match.

But here’s the nuance a smart future retiree needs to understand: RioCan isn’t essentially a “set it and forget it” income stock right now. It’s a watch-it-closely monthly dividend stock. Let me explain why.

The bull case for RioCan REIT as a monthly income investment

RioCan owns a huge portfolio of grocery-anchored shopping centres across Canada – 164 properties comprising 31 million square feet of gross leasable area (GLA). These aren’t flashy assets, but they’re remarkably resilient. During the second quarter, retail committed occupancy hit a record 98.8%, tenant retention sat at 92.5%, and new leasing spreads came in at an unbelievably juicy 40.8%. What that means is: when a tenant leaves, RioCan is replacing them at rents significantly higher than before.

Commercial same-property net operating income (NOI) grew 4.3% year over year in the August earnings release. That kind of steady, inflation-beating cash flow growth is what a retiree wants underpinning their regular income distributions.

Most noteworthy, RioCan REIT’s distributions remain well covered given a core funds from operations (FFO) payout rate of 73.8% over the 12 months to June 30, 2026. Payout rates should improve as committed leases transition into in-place rental income in 2027.

Effective October 1, 2026, RioCan REIT’s CFO Dennis Blasutti is back from a lengthy leave, assuring investors of continuity in the trust’s ongoing long-term financial strategies, including completing the strategic non-core RioCan Living asset dispositions that help improve the trust’s balance sheet’s quality.

The bear case: The rate environment just got complicated

Here’s the part that may keep some investors cautious. REITs are bond proxies. They employ significant debt and suffer from rising financing costs when the Bank of Canada turns hawkish. When rates rise, REIT valuations get squeezed like a lemon. And the Bank of Canada’s next move is no longer a sure thing as elevated oil prices amplify inflationary waves.

Markets are now pricing in potential rate hikes over the next year. Given that a September CPI reading came in at 3.1%, above the Bank’s target range, though core measures did ease, the October 28 rate decision will be telling.

Why does this matter for RioCan REIT specifically? The trust carries nearly $7 billion in debt, against $14.7 billion in assets. A new wave of rising bond yields and higher-for-longer rates mean refinancing costs may eat into distributable cash flow in the future. The near-term upside looks limited. But the payout remains intact.

One lingering hangover

Remember the Hudson’s Bay bankruptcy? RioCan has made progress in re-leasing the vacated space, and new tenants will move in during the next year. However, RioCan reportedly got tangled in a joint venture that included a prime Yorkdale Mall location. A court reportedly blocked a proposed lease transfer earlier this year, and the fallout isn’t fully cleaned up (publicly). Perhaps RioCan managed to find a new tenant by August, and management may share more details in the upcoming earnings event on November 2.  

Overall, this isn’t an existential threat, but it’s the kind of residual uncertainty that makes some investors want to see a clean resolution before getting too excited.

Investor takeaway

RioCan REIT’s 5.4% distribution yield, paid in monthly instalments. The underlying retail portfolio is performing well. Management is executing well on leasing. But macro headwinds, specifically rate hike risks, create potential real valuation pressure in the near term.

My take? Watch, don’t rush. Add RioCan REIT to your radar, track the October 28 Bank of Canada decision, and see how the Yorkdale situation resolves. If you’re building a retirement portfolio and want monthly income, RioCan could earn a place in a long-term retirement portfolio. The REIT’s yield is good, but its not a free lunch.

The post Still Working? Here’s a Monthly-Paying Dividend Stock Future Retirees Should Watch appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

These are volatile times. On one side, global tariffs, geopolitical uncertainty, and a move towards artificial intelligence (AI) are stagnating growth for some segments. On the other side, energy prices are surging to new highs. Canada is inviting global investments in Canadian energy, logistics, and AI infrastructure. As the largest North American oil and gas pipeline company, Enbridge (TSX: ENB) is playing an active role in this.

Down 16% and paying 5.8%

Since July, energy infrastructure stocks have seen a sharp dip as they are investing large sums in building infrastructure. The capital investment phase can be risky as a significant amount is diverted to projects which will take three to five years to generate cash flow. The company takes on the risk of building these long-gestation projects, assuming things will remain as they are now. But if the geopolitical scenario changes or the regulatory landscape reduces the company’s freedom to set prices, the return on capital will take a hit, as it did with BCE and Telus Corporation.

However, investors should cut this short-term noise and view infrastructure projects from a long-term perspective. Enbridge is not building power projects and natural gas pipelines for two to five years of cash flow. It is looking at a minimum of seven years before considering buying back equity interest in new projects from investors. Until then, existing projects will fund current dividends and new projects will pay their financing costs.

The 16% dip in Enbridge’s share presents a similar opportunity to what we saw back in October 2024. Back then, Enbridge stock fell 6–7%, and as it completed the $14 billion acquisition of three U.S. natural gas utilities, the stock surged 32% to a new 52-week high. The recent 16% dip has increased the yield to 5.8%. The upcoming third-quarter earnings on November 6 will shed some light on whether it can grow dividends in line with distributable cash flow (DCF) by 5%.

I do not expect 3% dividend growth to accelerate to 5%, considering the ongoing capital programs. Now is the right time to expand and capture market share in West Coast natural gas exports. Enbridge can monetize today’s investments for decades and grow dividends at that time.

The case for buying Enbridge now

LNG export opportunity: Enbridge has always been a dividend stock. But now it could give you 20–30% capital appreciation annually for the next three to five years as it brings new projects online. It is building Woodfibre LNG to ship more liquefied natural gas (LNG) from the Pacific West. It is also investing heavily in the expansion of the West Coast system.

Government support: Moreover, the Canadian government’s initiative to expedite approval of major infrastructure projects could help Enbridge lower the risk of delays in approval and the resulting costs. It could be a key beneficiary of Canada’s proposed Productivity Mega Deduction, which will allow businesses to deduct 100% of the cost of oil and gas pipelines. If the proposal is passed, Enbridge can claim large depreciation and significantly reduce its tax bill.

Dividend payout: At a time when major dividend stocks slashed dividends amidst rising balance sheet debt, Enbridge maintained its payout ratio at 63% in the first half of 2026. Even if the project goes over budget or energy demand slows, Enbridge has financial flexibility to pay its current dividends.

Leverage ratio: Now is the time to buy Enbridge stock despite its more than $1 trillion long-term debt. That debt is 4.5 to 5 times its adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA).

Investor takeaway

If you invest $6,000 in Enbridge today, you can buy 90 shares and expect the share price to grow by 20–50% in the next three years. Moreover, you can get an annual dividend of $363.70 in 2027, which can grow to $404.80 by 2031 if Enbridge maintains 3% dividend growth.

You can grow this dividend income by using the payout to buy more Enbridge shares. Consider using a Tax-Free Savings Account (TFSA) to avoid dividend tax.

The post Down 16% and Paying 5.8%: The Case for Buying Enbridge Now appeared first on The Motley Fool Canada.

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• 2 High-Yield Dividend Stocks to Buy and Hold for a Decade of Income

Fool contributor Puja Tayal has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge and TELUS. The Motley Fool has a disclosure policy.

Retirement continues to make Canadians anxious, with most fearing outliving their savings. Higher inflation and market volatility are adding to the anxiety as Canadians struggle to stay on track with retirement savings, according to the 2026 BlackRock survey. These concerns are valid, as many Canadians know that the Canada Pension Plan (CPP) and Old Age Security (OAS) alone probably won’t cover retirement.

Are CPP and OAS enough for a comfortable retirement?

The Canada Revenue Agency (CRA) has a formula to calculate your CPP and OAS payout. This payout is adjusted for inflation but can cover only a third of your retirement needs. While you cannot calculate your CPP payout if your retirement is decades away, you can make an educated guess about the percentage of expenses these benefits can cover.

As of January 2026, the maximum CPP payout is $1,507.65, but to earn it you must have been in a higher salary bracket and maxed out on CPP contributions for 40 years. This means you can either get the maximum CPP or the Guaranteed Income Supplement (GIS), which is for low-income earners. It is very rare to get both. OAS payout is also bound by taxable income, but you can get the maximum payout because of the high income threshold.

Based on the above logic, you can get anywhere between $2,200 and $2,700, rounding off figures to the lower range. But is this amount enough to retire?

The 2026 minimum tax bracket begins with annual income of $0 to $58,523. If you earn this amount, your monthly salary is $4,876.92, which is 47%–57% of what CPP, OAS, and GIS (if applicable) offer combined.

You can calculate your expenses or minimum monthly income you need to survive today and divide it by the retirement benefits to gauge the retirement gap.

How to fill the retirement gap

To fill the retirement gap, you need investments that can adjust to inflation and different life stages. This calls for a mix of future growth stocks and stable dividend growth stocks.

Growth stocks to adjust investments to your life stages

If you want a payout in the future, invest in futuristic stocks like Hut 8 Corporation (TSX: HUT) and Ballard Power Systems (TSX: BLDP). They are addressing major trends in power infrastructure for artificial intelligence (AI) data centres and hydrogen-powered fuel cells.

Hut 8 is building a gigawatt-capacity facility and has secured a 15-year lease that will generate cumulative base revenue of US$16.8 billion, which can go up to US$42.8 billion if used at maximum capacity. However, it will take time for these revenues to be realized. Till then, Hut 8 will shell out capital to build the power infrastructure. Its stock price rode the first round of the exponential AI rally of 800% from September 25, 2024 to September 25, 2026, as investor optimism around AI grew. The stock has almost halved since June 2026 as AI momentum slowed. If you are bullish about AI, you can buy this stock at the dip.

Another growth angle is alternative fuel. As countries fight for oil and gas, hydrogen can prove to be a strong alternative for transportation fuel and help reduce dependence on oil stocks. Ballard Power Systems has commercialized its hydrogen fuel cell technology and hired a professional management team to make it profitable and shareholder-friendly. It has yet to have its exponential growth moment. If you believe your kid will be driving a hydrogen car when he/she turns 20, Ballard Power Systems may likely give your investments that boost.

Dividend growth stocks to give inflation-adjusted passive income

While growth stocks can boost your investment toward your future reality, dividend growth stocks can silently build assured income. Royal Bank of Canada (TSX: RY) is a good option given its stable dividends and 24-year record of growing dividends at an average annual rate of 10%. The only two years it skipped growing dividends were 2009 and 2010 (Global Financial Crisis).

The post CPP and OAS Alone Probably Won’t Cover Retirement: How to Fill the Gap appeared first on The Motley Fool Canada.

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Fool contributor Puja Tayal has no position in any of the stocks mentioned. The Motley Fool recommends BlackRock. The Motley Fool has a disclosure policy.

Hammond Power Solutions (TSX: HPS.A) has been one of the standout growth stocks on the Toronto Stock Exchange lately. It generated an extraordinary 625% return over three years, leading to its inclusion on the 2026 TSX30 ranking. The fast-growing manufacturer of dry-type electricity transformers and power quality equipment has capitalized directly on the secular tailwinds of grid electrification and the artificial intelligence (AI) data centre investment boom. As the company prepares to report its third-quarter earnings, probably next week on October 27 (unconfirmed), long-term investors should keep a close watch on one critical operational health indicator: its order backlog.

Strong regional performance driving surging orders

By the end of the second quarter of 2026, Hammond Power’s order backlog was 96.9% higher than it was at the end of the second quarter of 2025. This massive year-over-year surge underscores relentless market demand across North America, led by its U.S. and Mexico geographical segment where quarterly revenue surged 73% year-over-year.

Chief Executive Officer Adrian Thomas noted that demand continues to be propelled by heavy data centre buildouts, power infrastructure upgrades, and industrial electrification. Although Canadian sales fell 23.7% due to project timing and broader market softness, strong U.S. execution lifted overall consolidated revenue by 44.7% year-over-year.

Momentum remains strong, overall.

How Hammond Power reports its backlog metric

Backlog is a precursor to future revenue. At Hammond Power, backlog represents “all unfinished customer orders”. To deeply understand Hammond Power’s backlog, investors must evaluate how management communicates this metric.

Unlike many industrial capital goods manufacturers, HPS does not publish absolute dollar figures for its order backlog in its financial statements. Instead, management reports backlog movement strictly as relative percentage shifts alongside qualitative commentary. That’s understandable, as customers may cancel or alter orders any time, especially when shipping dates aren’t confirmed. And customers for such capital equipment often aren’t so sure about such dates at order placement. So its ok to be conservative about the hard numbers.

However, since Hammond Power’s exact backlog dollars remain proprietary, Bay Street often evaluates Hammond Power’s demand trajectory by comparing sales growth against the company’s annualized manufacturing capacity, which management has been expanding toward the $1.2 billion mark. This capacity recently expanded in September.

Similarly, while balance sheet disclosures show contract liabilities; representing customer prepayments and deposits (deferred revenue) rising to $10.3 million at the end of the second quarter, up from $5.9 million at year-end 2025; this accounting measure reflects only a narrow fraction of total unfulfilled customer commitments.

Hammond Power Solutions Backlog growth rates

Understanding HPS stock’s sequential contraction versus long-term demand

Heading into next week’s third-quarter earnings release, investor concerns center on whether the backlog will expand further or continue a slight sequential contraction noted in June.

On a quarter-over-quarter basis, the second-quarter 2026 backlog dipped 6.9% from the first quarter and contracted by 3.1% from December 2025 year-end levels as record quarterly shipments exceeded new order bookings.

Rather than indicating an operational slowdown, this minor sequential decline demonstrates the company’s continued success in converting unfulfilled orders into recognized revenue. Following management’s September 22 announcement regarding expanded manufacturing capacity across North America, Hammond Power can now process custom transformer orders faster, reducing customer lead times and improving fulfillment efficiency.

The strategic investment question for the third quarter is how this added production capacity impacts backlog dynamics over the coming quarters.

On one hand, faster manufacturing throughput accelerates backlog conversion into revenue, which could naturally pull down total backlog levels if order intake remains static. On the other hand, expanded capacity may allow major data centre operators and utility customers to place even larger bulk orders, knowing that Hammond Power can meet tighter delivery schedules. If order intake adjusts upward to match this higher capacity, the business could establish a new, higher equilibrium of recurring order flow.

Investor takeaway

With its recent margin expansion supported by pricing power and a favourable custom product mix, Hammond Power stock is facing its third-quarter earnings release from a position of operational strength. Watching how management balances rapid order conversion against fresh booking momentum on October 27 (unconfirmed date) will offer the clearest window into the stock’s next growth leg.

The post I’m Watching Hammond Power’s Backlog, Now Nearly Double Last Year’s appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hammond Power Solutions. The Motley Fool has a disclosure policy.

Balance sheet debt is rising as the Canadian government accelerates key infrastructure projects. This has created optimism and driven prices of infrastructure stocks after three years of sluggish growth post-2022. Among them is energy infrastructure stock Enbridge (TSX: ENB).

The $41 billion backlog

Enbridge is a dividend aristocrat that has been paying dividends from its age-old pipeline infrastructure critical to transmitting oil from Canada to the United States. Until 2022, things were smooth sailing, with exports and oil demand at normal levels. The energy sector took a turn in 2022, as the Russia-Ukraine war revived old oil refineries and changed the global energy landscape.

Global wars have reignited energy trade. For the first time in 20 years, Canada decided to accelerate energy infrastructure investment and look beyond America for its energy exports. It is exploring the Pacific West to export oil and gas to Asian countries. This led to the beginning of Canada’s first LNG Canada export facility in 2025.

Energy companies, from Enbridge to TC Energy to Pembina Pipeline, are firing all cylinders to make the most of this opportunity. They are pouring in capital to capture a larger piece of energy exports. Enbridge’s capital program shows opportunities to reinvest in the business.

Enbridge’s interest in the West Coast natural gas pipeline

Enbridge is also focusing on the Pacific West and looks to claim a significant share of Canadian LNG exports from the West. Its biggest capex project is the $4 billion Sunrise expansion program in the West Coast system, expected to become operational by 2028. It has secured $2.7 billion in funding in a joint venture with KKR and Apollo by offering them a 29% interest. Enbridge will retain majority ownership and operational control and pay distributions to the investors as projects enter service. It has the option to repurchase this joint venture interest between the seventh and fourteenth year. This funding round shows how the terms are favourable for Enbridge.

Like West Coast, Enbridge has secured capital for all $41 billion of capital projects, a majority of which are expected to come online by 2029. So far, Enbridge has spent $12 billion of the $41 billion capex, hinting at strong execution.

The capex brings with it high financing costs. But since most projects are brownfield expansions with faster turnaround, they keep pace with financing costs.

Why Enbridge’s $41 billion backlog is better than chasing a higher yield

Reinvestment opportunities push dividend growth on the back burner in the short term but increase stock price as the asset base grows. Once the projects come online and start earning free cash flow, dividend growth picks up.

After rallying 25% in the first half of 2026, Enbridge stock has dipped 27% since July, when it announced the acquisition of Tallgrass’ crude transportation business and raised equity financing for it.

Enbridge’s $41 billion capex looks overwhelming at first as it has grown fourfold in five years. But energy is a cyclical sector, and the current supply chain transition is a golden ticket to Charlie’s Chocolate Factory. Until now, the Mainline was Enbridge’s key revenue driver. Had it not invested in the Mainline in the past, it wouldn’t be paying a 5.8% dividend yield and growing dividends for 30 consecutive years.

A higher yield comes when there are no significant reinvestment opportunities. High yield and capex acceleration cannot go hand-in-hand. We have examples all over the place from BCE to Slate Grocery REIT to Algonquin Power & Utilities. They accelerated capex or made acquisitions while retaining their dividends. When interest rates grew, finance costs went through the roof, straining their free cash flow. This increased their dividend payout ratio to alarming levels, forcing them to cut dividends.

Enbridge continues to manage its FCF and keep its dividend payout ratio within its target range of 60–70% despite the increasing capex. With interest costs aligned to project cash flows, Enbridge’s 3% dividend growth is a safer option than high yield, as Enbridge leaves room to accelerate dividend growth in the long term.

The post Why I’d Rather Own Enbridge and Its $41 Billion Backlog Than Chase a Higher Yield appeared first on The Motley Fool Canada.

More reading

• Enbridge Stock: 3 Things to Look for in Its Q3 Results
• How I’d Structure a $25,000 TFSA for Steady Income, Stock by Stock
• Income Investors: 2 Top TSX Stocks With High Yields to Consider Now
• Enbridge vs. TC Energy: Which Stock Is the Better Buy?
• 2 High-Yield Dividend Stocks to Buy and Hold for a Decade of Income

Fool contributor Puja Tayal has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge and Pembina Pipeline. The Motley Fool has a disclosure policy.

Canadian income investors don’t always have to settle for slow quarterly payouts or low-yielding guaranteed investment certificates (GICs). Sienna Senior Living (TSX: SIA) stock, a retirement home provider, offers a compelling passive income stream. It pays a reliable 4.7% dividend yield distributed in 12 monthly installments. Over the past five years, Sienna stock generated a massive 125% peak total return. An 87% total gain remains intact today despite recent market pullbacks, while the dividend remains an unsung hero.

Capital appreciation has accounted for a modest 36% gain, while monthly dividends drove overall returns. Without this payout stream, Sienna’s capital returns would have widely lagged the broader market. But the future is looking more promising.

SIA data by YCharts

The Sienna stock dividend has been instrumental in lifting total returns on the demographics tailwinds play, and its highly likely that the payout will remain a key returns driver. The monthly dividend stock is likely to restart dividend raises after a long pre-pandemic pause.

Sienna Senior Living’s demographic tailwinds and tax advantages

Sienna operates long-term care beds and private retirement residences across Ontario, British Columbia, Alberta, and Saskatchewan. An undeniable, and potentially accelerating demographic shift drives long-term demand for its retirement home offerings. Canada’s population aged 85 and older could triple over the next two decades. And Sienna Senior Living’s retirement portfolio occupancy rates recently increased by 150 basis points to 94.1%.

The business’s revenue, earnings and cash flow generating capacity are growing as it caters to a growing client base. Second-quarter same property net operating income surged 19.4% higher, year over year. In August, Sienna partnered with Fiera Capital in a $625 million redevelopment projects plan in Ontario that adds bed capacity and modernizes its offerings. Revenue and earnings growth may accelerate faster, supported by acquisitions.

Most noteworthy, investors stashing this growing monthly dividend stock in taxable accounts enjoy some advantages they won’t get if they load up on Sienna’s closest peers.

Unlike pure Canadian Real Estate Investment Trusts (REITs), Sienna is structured as a taxable corporation. Its distributions are thus classified as eligible dividends for tax purposes. Eligible dividends qualify for the Canadian Dividend Tax Credit in non-registered accounts. This tax advantage sets Sienna Senior Living stock apart from close peers like Chartwell Retirement Residences and Extendicare.

SIA’s financial realities and inflation protection concerns

Critically evaluating this monthly dividend stock as a reliable passive income source for the next several years requires weighing its sector tailwinds against financial risks.

As a real estate play, Sienna carries significant debt obligations that require active management in fluctuating rate markets. Operating cost inflation and wage pressures also require disciplined corporate execution as the business captures more opportunities across Canada.

Is this passive income opportunity better than a GIC on a risk-adjusted basis? While fixed GICs lack capital upside, Sienna stock may generate capital gains that provide more than inflation protection, and the dividends could begin to rise again.

Recent operational results demonstrate strong growth momentum. Adjusted funds from operations (AFFO) per share are growing, and a recent drop in AFFO payout rates is reassuring that there’s room for dividend growth now.

Should you invest for passive income

Dividend safety is where Sienna’s financial profile shines brightest lately. The company pays a monthly distribution of $0.08 per share. That equals an annualized payout of $0.94 per share. Its payout ratio recently dropped from 89.5% down to a conservative 72.3%. A low payout ratio provides a solid safety buffer for income investors.

Investors can also enroll in Sienna’s Dividend Reinvestment Plan (DRIP). The DRIP issues new shares at a 3% market discount. This discount accelerates long-term compounding without paying extra transaction fees.

Foolish bottom line

Holding Sienna Senior Living stock in a TFSA or taxable account still adds valuable tax efficiency. You collect regular monthly cash flow backed by an aging population.

A forward price-earnings-to-growth (PEG) ratio of 0.3 implies SIA stock could be undervalued given its future earnings growth potential.

Meanwhile, a 3% DRIP discount should give long-term compounders an extra tactical advantage that makes SIA stock’s 4.7% dividend stream a core holding for steady growth and sustainable monthly income.

The post This Stock Pays You a 4.7% Dividend Every Single Month appeared first on The Motley Fool Canada.

More reading

• A 4.8% Dividend Stock for Monthly Retirement Income
• Here’s a 4.8% Dividend Stock That Pays Out Monthly
• The Perfect Retirement TFSA Stock: A 4.8% Yield With Monthly Paycheques
• The TSX Dividend Stock I Wish I Bought Sooner

Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool recommends Fiera Capital. The Motley Fool has a disclosure policy.