A Canadian dividend stock that pays out dividends on a monthly, quarterly, or annual basis can add much-needed income stability to your portfolio.
That said, investing in the best dividend stocks does not simply mean choosing the ones with the highest dividend payout ratios or dividend yields.
While evaluating your dividend stock picks, you should also consider the company’s overall performance, including its revenue growth, earnings per share (EPS), dividend growth rate, price-to-earnings (P/E) ratio, and the sustainability of its business model.
Below, I list the 15 best Canadian dividend stocks for 2024.
Best Dividend Stocks in Canada
Unsurprisingly, the top Canadian dividend stocks include a mix of dividend aristocrat stocks, big bank stocks, and some of the best monthly dividend stocks you can buy and hold in Canada.
1. Enbridge
- Symbol: ENB.TO
- Sector: Energy
- Dividend Yield: 7.79%
- Dividend Payout Ratio: 185.90%
- Market Cap: $96.82 billion
Enbridge shares have had a 10% compound annual growth rate (CAGR) over the last 26 years.
Even better, the company has steadily paid dividends to its shareholders, and in 2022, Enbridge raised the dividend for the 28th consecutive year.
This dividend aristocrat stock has a stable business across North America and is Canada’s largest natural gas distribution network.
Enbridge’s business includes pipelines for crude oil, natural gas transmission, gas utilities, and renewable energy. It also recently acquired Dominion Energy and its natural gas infrastructure and services. This makes Enbridge the largest natural gas utility company in North America.
ENB has a forward dividend yield of 7.79% and a massive payout ratio of 185.90%. Its significant cash flows support a high dividend payout ratio exceeding 100%.
2. Fortis
- Symbol: FTS.TO
- Sector: Utilities
- Dividend Yield: 4.46%
- Dividend Payout Ratio: 75.34%
- Market Cap: $25.72 billion
With an outstanding record of increasing dividends for 49 consecutive years, Fortis is a strong contender for one of the best dividend-paying stocks in Canada.
Fortis Inc. was founded in 1885 in Newfoundland and Labrador. It provides electricity to 3+ million customers in various markets, including Canada, the United States, and the Caribbean.
Electricity is a non-discretionary expense you pay for regardless of your budget, and I bet that Fortis will continue to enjoy significant growth in earnings for years to come.
FTS currently has a forward dividend yield of 4.46%, a dividend payout ratio of 75.34%, and a P/E ratio is 16.67.
As per the company’s forecast, the annual dividend growth rate until 2027 is expected to be 4-6% on average.
Fortis is also working on decreasing its carbon footprint, with a plan to reduce carbon emissions by 80% at TEP by 2035 and lower greenhouse gas emissions by 30% at its BC operations by 2030.
3. Royal Bank of Canada
- Symbol: RY.TO
- Sector: Financial Services
- Dividend Yield: 4.54%
- Dividend Payout Ratio: 43.35%
- Market Cap: $183.14 billion
The Royal Bank of Canada (RBC) is the largest in Canada based on market capitalization. It is also one of the best-performing banks in North America and the eleventh-largest bank in the world.
With over 17 million customers and operations in 36 countries, RBC’s earnings and asset base have continued to climb for over 50 years.
The forward annual dividend yield for RY is 4.54%, and its payout ratio is 50.92%.
The P/E ratio for RY is 9.95.
4. Suncor Energy Inc.
- Symbol: SU.TO
- Sector: Financial Services
- Dividend Yield: 4.50%
- Dividend Payout Ratio: 43.84%
- Market Cap: $61.69 billion
Suncor Energy is a Canadian energy company that primarily produces oil from oil sands and refines crude oil. It also operates in renewable energy infrastructure and even owns Petro-Canada gas stations nationwide.
This stock has been paying out quarterly dividends since 1992 and currently offers a yield of 4.50%.
Canadian energy stocks often have high cash flow, allowing them to pay out a high dividend payout ratio. This ratio calculates the amount of dividends paid out as a factor of net earnings. Suncor’s payout ratio is very reasonable at just 43.84%.
5. Canadian National Resources Limited
- Symbol: CNQ.TO
- Sector: Energy
- Dividend Yield: 4.13%
- Dividend Payout Ratio: 49.78%
- Market Cap: $97.32 billion
Canadian National Resources is one of the largest crude oil and natural gas producers in the world.
The company has operations in Canada, the United Kingdom, Gabon, and Cote d’Ivoire.
Based on a current price of $89.10 in September 2023, CNQ has a forward dividend yield of 4.13% and pays out just less than half its net earnings as dividends.
As a part of the “Oil Sands Pathway to Net Zero” initiative, Canadian Natural Resources aims to achieve net-zero greenhouse gas emissions from its oil sands operations by 2050.
6. TC Energy Corporation
- Symbol: TRP.TO
- Sector: Energy
- Dividend Yield: 7.71%
- Dividend Payout Ratio: 406.67%
- Market Cap: $48.74 billion
TC Energy Corporation is one of the largest oil and gas pipeline operators in North America. It has pipeline infrastructure across Canada, the United States, and Mexico.
Like Enbridge, TC Energy can afford to pay out a dividend with a payout ratio above 100% because of its high rate of free cash flow. That said, the current dividend payout ratio of more than 400% is quite high.
The company operates 92,600 kilometres of natural gas pipelines and 4,900 kilometres of oil pipelines. It also operates in clean energy infrastructures like wind and solar energy generation.
It has a massive dividend yield of 7.71% and an average dividend yield of 5.44% over the last 5 years.
7. Toronto-Dominion Bank
- Symbol: TD.TO
- Sector: Financial Services
- Dividend Yield: 4.72%
- Dividend Payout Ratio: 48.77%
- Market Cap: $147.77 billion
Toronto-Dominion Bank is Canada’s second-largest bank by market capitalization, behind only the Royal Bank of Canada.
This bank has over 26 million global customers across multiple different countries. In Canada, it operates under the TD Canada Trust brand and has more than 11 million Canadian customers.
TD Stock has paid out a dividend of some sort for the past 164 years! Since 1995, the CAGR of TD’s dividend has been a staggering 11% per year.
With a current yield of 4.72% as of September 2023 and a payout ratio of 48.77%, TD is a foundational dividend stock for Canadian investors.
8. BCE
- Symbol: BCE.TO
- Sector: Communication Services
- Dividend Yield: 7.43%
- Dividend Payout Ratio: 149.80%
- Market Cap: $46.99 billion
Formerly known as Bell Canada Enterprises, BCE is the largest communications company in Canada. It is a top-10 high-paying Canadian dividend stock.
It also has a huge stake in the country’s media landscape with its ownership of CTV, TSN, Crave, iHeartRadio, and others.
BCE has a healthy dividend yield of 7.43%, and while its payout ratio is a whopping 149.80%, I’m not concerned, as its cash flow generation is spectacular. The dividend yield is elevated as the stock price has fallen by nearly 15% so far in 2023.
9. Manulife Financial Corporation
- Symbol: MFC.TO
- Sector: Communication services
- Dividend Yield: 5.83%
- Dividend Payout Ratio: 20.75%
- Market Cap: $44.90 billion
Manulife is Canada’s most extensive insurance and financial services company. It was founded way back in 1887 and was headed by Prime Minister John A. Macdonald.
This Canadian dividend stock has had a 5-year dividend CAGR of nearly 10%. It also has an extremely low payout ratio of 20.75%, indicating that the dividend growth will likely continue.
10. Alimentation Couche-Tard Inc
- Symbol: ATD.TO
- Sector: Communications services
- Dividend Yield: 0.80%
- Dividend Payout Ratio: 12.95%
- Market Cap: $67.89 billion
Alimentation Couche-Tard is a company that has come onto the radar of many Canadian investors this year. It is known more by the convenience store franchises that it owns, such as Couche-Tard, Circle K, and Mac’s Convenience stores.
This Canadian dividend stock might not have the largest yield, but it comes with a meagre dividend payout ratio of just 12.95%. This means there is plenty of room for ATD to grow this dividend moving forward.
On top of the dividend distributions, ATD has also seen a solid 16.84% return for shareholders this year.
11. Bank of Montreal
- Symbol: BMO.TO
- Sector: Financial services
- Dividend Yield: 5.13%
- Dividend Payout Ratio: 56.41%
- Market Cap: $81.18 billion
BMO is one of the largest banks in Canada and the oldest, with a 204-year history.
The bank has been paying dividends since 1829 and has a policy to pay out 40-50% of its earnings in dividends over time.
The Bank of Montreal has over 12 million customers globally and you can almost expect its dividend payouts to continue without interruption.
12. Granite Real Estate Investment Trust
- Symbol: GRT-UN.TO
- Sector: Real Estate
- Dividend Yield: 3.94%
- Dividend Payout Ratio: 34.43%
- Market Cap: $4.99 billion
Granite REIT holds a diversified portfolio of 137 properties across seven countries, including Canada, the U.S., the U.K., the Netherlands, and Germany.
This translates into 62.9 million square feet of leasable area in prime real estate markets around the world.
Its 4.45% forward annual dividend yield is decent and if you are looking to diversify your holdings, I consider GRT-UN to be one of the best dividend stocks right now.
13. National Bank
- Symbol: NA.TO
- Sector: Financial Services
- Dividend Yield: 4.55%
- Dividend Payout Ratio: 41.68%
- Market Cap: $30.02 billion
National Bank is the 6th largest bank in Canada, with assets exceeding $350 billion.
It has been expanding its operations outside Quebec and currently has 389 branches and 929 ATMs across Canada, serving 2.6 million customers.
As per its most recent investor facts sheet, the company aims to keep its dividend payout ratio in the 40-50% range. The 41.68% dividend payout ratio is a solid rating among Canadian dividend stocks.
14. Pembina
- Symbol: PPL.TO
- Sector: Energy
- Dividend Yield: 6.62%
- Dividend Payout Ratio: 54.04%
- Market Cap: $22.28 billion
Pembina Pipeline Corporation has been around for over 65 years and owns pipelines that transport oil and gas across Western Canada.
Pembina pays out cash dividends every month, which is rare for stocks on the TSX. The company competes with two other stocks on my list: TC Energy and Enbridge.
15. Canadian National Railway Company
- Symbol: CNR.TO
- Sector: Industrials
- Dividend Yield: 2.11%
- Dividend Payout Ratio: 39.04%
- Market Cap: $96.20 billion
With railway transportation remaining a principal way to move freight across North America, CN continues to do very well.
The Canadian National Railway has a 20,000-mile network spanning Canada and the U.S. It was established in 1919 and transports over 300 million metric tonnes of goods annually.
CNR has consistently increased dividends over the last two decades, and its balance sheet and cash flow statements look great.
Its P/E ratio as of this update was 17.36 in September 2023.
How To Invest in Canadian Dividend Stocks
You can invest in the best dividend stocks by either buying individual stocks directly or using Canadian dividend ETFs that hold multiple dividend stocks.
Purchasing individual stocks:
After evaluating a dividend stock using the relevant fundamental and technical analytical tools, you can purchase it using a discount brokerage account.
Picking individual stocks increases your investment risks as your portfolio could end up being concentrated in only a handful of securities. This is also referred to as a poorly diversified portfolio.
A dividend mutual fund or Exchange-Traded Fund (ETF) holds a bunch of stocks and pays out dividends similar to holding individual stocks.
These funds make it easier to diversify your holdings across various stocks with just one asset.
That said, you can expect to pay a small fee for this convenience, aka a management fee or Management Expense Ratio (MER).
If bank dividend stocks are what you fancy, these Canadian Bank ETFs are a great place to start your search.
How To Buy Dividend Stocks in Canada
My top choices for buying dividend stocks or ETFs in Canada are Qtrade, Questrade and Wealthsimple Trade:
In addition to supporting stock and ETFs, you can use Qtrade to purchase GICs, mutual funds, options, bonds, and other assets. This platform offers no-commission trading for some ETFs and has a competitive fee for stock trading.
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