The 20 Best Canadian Dividend Stocks for U.S. Investors
These 20 Canadian Dividend Aristocrats trade on either the NYSE or Nasdaq, and have increased their dividends annually for at least seven years.
The U.S. is home to literally thousands of dividend payers, which would seem to eliminate the need to look elsewhere for income. But there's a convincing case to be made for at least a handful of Canadian dividend stocks.
American investors interested in generating a combination of income and capital appreciation often look to the Dividend Aristocrats – a select group of 65 S&P 500 stocks that have improved their annual payouts for at least 25 consecutive years.
However, a little international diversification can help provide ballast to most portfolios. And if you like the idea of purchasing payout-raising stocks, you can do that across a number of regions – including our neighbors up north.
The Canadian Dividend Aristocrats currently total 87 stocks at present. To qualify for inclusion, these Canadian dividend stocks must be listed on the Toronto Stock Exchange, be a member of the S&P Canada BMI (Broad Market Index), must increase its annual payout for five consecutive years (it can maintain the same dividend for two consecutive years) and have a float-adjusted market cap of at least C$300 million.
While 87 stocks qualify for the index, we've thinned the herd somewhat for U.S. investors. Here, then, are 20 of the top Canadian dividend stocks to buy that are listed on either the New York Stock Exchange or Nasdaq.
Data is as of March 28. Dividend yields are calculated by annualizing the most recent quarterly payout and dividing by the share price. Analysts' opinions provided by S&P Global Market Intelligence. Figures are in U.S. dollars unless otherwise indicated. Stocks listed in reverse order of the length of their dividend-growth streaks.
Pembina Pipeline
- Market value: $15.9 billion
- Dividend yield: 6.9%
- Consecutive annual dividend increases: 9
- Analysts' opinion: 6 Strong Buy, 5 Buy, 9 Hold, 0 Sell, 0 Strong Sell
Pembina Pipeline (PBA, $28.87) is a leading North American energy infrastructure company based in Calgary, Alberta, and one of several energy plays on this list of Canadian dividend stocks. The company's pipelines transported 3.6 million barrels of oil equivalent per day (mboe/d) in 2020.
Its pipeline business accounted for 39% of Pembina's overall 2020 revenue of C$6.2 billion Canadian dollars, with its marketing & new ventures division accounting for 56%. Its facilities division, which gathers and processes natural gas, accounts for the rest. As for adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), the company reported a record C$3.3 billion Canadian dollars in 2020, up 7.2% from a year earlier.
Pembina has increased its dividend for nine consecutive years. In 2020, the company increased its monthly dividend payment by 1 Canadian cent to 21 Canadian cents, or C$2.52 per share annually, 6.8% higher than in 2019.
That's not the only way Pembina is rewarding shareholders. In February, Pembina announced a share repurchase program to buy back up to 5%, or 27.5 million, of its outstanding shares.
Algonquin Power & Utilities
- Market value: $9.5 billion
- Dividend yield: 3.9%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 2 Strong Buy, 6 Buy, 6 Hold, 1 Sell, 0 Strong Sell
Algonquin Power & Utilities (AQN, $15.89) is a Canadian utility company with more than $13 billion in power generation assets in the U.S. and Canada. It serves more than 2.7 million customers in three provinces, 13 states, Bermuda and Chile.
AQN is currently in the first year of a five-year $9.4 billion capital plan that will see it invest 70% of those funds in its Regulated Services Group and the remaining 30% in its Renewable Energy Group. In 2020, the two segments undertook construction projects totaling 1,600 megawatts capacity – the largest annual construction program in its history.
Algonquin is one of a large number of Canadian dividend stocks with at least a decade of consecutive dividend raises under its belt. AQN last raised its quarterly dividend by 10% with its July 2020 payment of 15.51 cents per share.
Bank of Nova Scotia
- Market value: $76.7 billion
- Dividend yield: 4.5%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 3 Strong Buy, 5 Buy, 2 Hold, 4 Sell, 0 Strong Sell
Bank of Nova Scotia (BNS, $63.24) is one of Canada's "Big Five" banks with more than 10 million customers and 953 branches. It also operates Tangerine, an online bank with more than 2 million customers.
In addition to its core Canadian market, its international banking unit serves more than 15 million customers in Mexico, Peru, Chile, Colombia, Central America and the Caribbean. Its wealth management business operates in 14 countries around the world.
In February, BNS reported strong first-quarter earnings despite a decline in business at its international banking unit. Its adjusted profit for the quarter was C$1.88 per share, 31 Canadian cents per share higher than analyst expectations.
The bank failed to raise its quarterly payout in fiscal 2020, but its annual distributions improved by 3.2% to C$3.60 per share.
Brookfield Asset Management
- Market value: $69.0 billion
- Dividend yield: 1.1%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 4 Strong Buy, 7 Buy, 2 Hold, 0 Sell, 0 Strong Sell
Brookfield Asset Management (BAM, $45.67) is one of the world's largest alternative asset managers, with combined assets of $602 billion and $6.5 billion in annual fee-related earnings and carried interest.
To continue growing its assets under management, Brookfield has launched four new strategies that include investing in the transition to net-zero carbon emissions, reinsurance, technology private equity and LP secondaries, which involves buying an investor's stake in an existing private equity fund.
All of these have the potential to become a major contributor to its future earnings.
In January, Brookfield announced a bid to acquire the 40% of Brookfield Property Partners it doesn't already own for $5.9 billion. Brookfield Property owns $88 billion in global real estate but has suffered under the pandemic.
The company estimates that, based on discounted future cash flows, its shares were worth $66 at the end of 2020 – 17% higher than its estimate at the beginning. It's just one way of measuring how BAM continues to build value for shareholders.
This Canadian dividend stock most recently raised its quarterly payout by 1 cent, to 13 cents per share, starting with the March 2021 distribution.
Canadian Imperial Bank of Commerce
- Market value: $44.6 billion
- Dividend yield: 4.7%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 5 Strong Buy, 8 Buy, 3 Hold, 0 Sell, 0 Strong Sell
Canadian Imperial Bank of Commerce (CM, $99.52) is the smallest of Canada's five big banks. However, it greatly expanded its U.S. business in 2017, buying Chicago-based PrivateBancorp for $5 billion in cash and shares. As of the end of January, the bank had total assets of C$782.9 billion and a Common Equity Tier 1 Ratio of 12.3%.
In February, CIBC reported its first-quarter results, which included an 11% increase in adjusted net income to C$1.64 billion from C$1.48 billion a year earlier.
All four of its operating segments experienced year-over-year growth in the quarter. Its Canadian Personal and Business Banking segment, which accounts for 38% of the bank's adjusted profits, experienced a 13% increase in the quarter. Capital Markets, the bank's second-largest contributor to adjusted net profits at 29% overall, had a 30% increase YoY.
CIBC most recently raised its quarterly dividend by 2 cents, to $1.46 per share, starting with the April 2020 payment. Over the past 15 years, the Canadian Aristocrat's dividend has grown at a compound annual rate of 4.3%.
Royal Bank of Canada
- Market value: $132.7 billion
- Dividend yield: 3.7%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 3 Strong Buy, 8 Buy, 4 Hold, 0 Sell, 0 Strong Sell
Royal Bank of Canada (RY, $93.11) is one of Canada's biggest banks and among the world's largest by market capitalization. It has over 17 million customers; operates in 36 countries, including the U.S. and Canada; and has more than 86,000 full- and part-time employees.
In June 2020, RBC was named Retail Banker International's North American retail bank of the year for the third consecutive year. According to the 2020 Ipsos Financial Service Excellence Awards, RBC received 10 out of 11 top rankings for customer service among Canada's top five banks.
In 2020, Royal Bank's revenues increased by 2.6% to C$47.2 billion. However, COVID-19 squeezed its net earnings, which fell by 11.1% to C$1.4 billion. The biggest decline was from its Personal & Commercial Banking and Wealth Management segments.
Over the past 10 years, the bank has increased its annual dividend by 8% compounded annually, which is high compared to most of the Canadian dividend stocks on this list. In 2020, it increased its quarterly dividend by a more modest 3%, to $1.08 per share.
This past year, RY returned 63% of its profits to shareholders through dividends and share repurchases. Over the past five years, its dividend payout ratio has averaged 48%, well within its stated goal of 40% to 50% of its earnings – a modest figure that should ensure the payout's safety over the long term.
Toronto-Dominion Bank
- Market value: $118.2 billion
- Dividend yield: 3.8%
- Consecutive annual dividend increases: 10
- Analysts' opinion: 3 Strong Buy, 2 Buy, 7 Hold, 3 Sell, 0 Strong Sell
Toronto-Dominion Bank (TD, $65.93) is North America's fifth-largest bank by total assets and the sixth-largest according to market cap.
The bank announced Q1 2021 results in February. Its adjusted net income was 10.3 billion Canadian dollars, the best amongst Canadian banks. In terms of total assets and total deposits, it finished the quarter as the top-ranked bank in Canada and fifth in North America.
In October 2020, TD became the largest shareholder in Charles Schwab (SCHW) after the Texas-based financial services firm acquired TD Ameritrade. TD's 13.5% ownership stake delivered $161 million in first-quarter profits, $9 million more than its stake in TD Ameritrade generated a year earlier.
The bank's Canadian retail business generated 58% of its 2020 earnings; the U.S. business, including TD Ameritrade, another 28%; and wholesale banking, accounted for the rest.
This Canadian dividend stock has increased its annual payout for a full decade. In 1995, its annual dividend was 22 Canadian cents. In 2020, it was C$3.11, a compound annual growth rate of 11%. It targets a yearly payout of 40% to 50% of its earnings per share.
Magna International
- Market value: $26.2 billion
- Dividend yield: 2.0%
- Consecutive annual dividend increases: 11
- Analysts' opinion: 8 Strong Buy, 5 Buy, 5 Hold, 1 Sell, 1 Strong Sell
When it comes to the electrification of automobiles and trucks, Magna International (MGA, $86.95) got busy in 2020.
In October, it announced that it would build Fisker Automotive's (FSR) Ocean SUV, which is expected to make its debut in November 2022. In December, it signed a joint venture with LG Electronics to manufacture e-motors, inverters and electric-drive systems from factories in South Korea and China. Magna will own 49% of the LG Magna e-Powertrain joint venture; LG will own the majority.
In February, Magna announced fourth-quarter results that included sales of $10.5 billion, 13% higher than a year earlier. Adjusted EBIT (earnings before interest and taxes) of $1.1 billion was 86% higher than last year.
Magna also announced an 8% increase in its quarterly dividend to 43 cents per share. It is the company's 11th consecutive annual payout hike. In addition to paying out $467 million in dividends last year, Magna repurchased $203 million worth of its shares.
As the automotive industry continues to electrify, Magna is among a small handful of Canadian dividend stocks that will benefit from the transformation.
Waste Connections
- Market value: $27.9 billion
- Dividend yield: 0.8%
- Consecutive annual dividend increases: 11
- Analysts' opinion: 10 Strong Buy, 5 Buy, 1 Hold, 1 Sell, 0 Strong Sell
Waste Connections (WCN, $106.50) is a waste services company providing garbage and recycling collection for secondary markets to more than 7 million residential, commercial, and industrial customers in 43 U.S. states and six Canadian provinces.
Over the past three years, Waste Connections has grown its adjusted free cash flow (the cash left over after making capital expenditures) from $551 million in 2018 to $917 million in 2020. In 2021, it expects free cash flow to be at least $950 million, or 16.4% of revenue.
Due to its strong FCF generation, this Canadian dividend play expects to increase its cash payouts and share repurchases this year by double-digit percentages.
In 2020, Waste Connections' revenue grew by 1.1% to $5.45 billion. The company completed acquisitions in the past year valued at $737 million. These acquisitions added $180 million in annualized revenue in 2020. WCN's adjusted net income was $2.64 per share, down just 2.9% year-over-year.
In October 2020, Waste Connections increased its quarterly dividend by 11% to 20.5 cents per share. It paid out $199.9 million for dividends and $105.7 million for share repurchases in 2020.
Brookfield Infrastructure Partners LP
- Market value: $15.7 billion
- Distribution yield: 3.8%*
- Consecutive annual distribution increases: 12
- Analysts' opinion: 4 Strong Buy, 5 Buy, 3 Hold, 0 Sell, 1 Strong Sell
Brookfield Infrastructure Partners LP (BIP, $53.31), as the name implies, invests in infrastructure assets. The company owns utilities, transportation, energy and data assets worth more than $94 billion. And if the name sounds familiar, that's because it's a spinoff of its parent, Brookfield Asset Management, which still owns 30% of its shares.
And as of late, BIP has been doing a bit of wheeling and dealing.
In early February, Brookfield announced it was selling its Enwave district energy business in two separate transactions for a total of $4.1 billion. The company acquired Enwave in 2012 from the city of Toronto for C$480 million in cash and assumed debt. At the time, Enwave had EBITDA of $26 million. Today, it generates more than $200 million in EBITDA annually.
Also in February, Brookfield launched a hostile takeover of Canadian energy infrastructure company Inter Pipeline for C$7.1 billion.
BIP is among several Canadian dividend stocks that have already announced increases in 2021, recently raising its quarterly distribution by 5.2% as of the March payment.
* Distributions are similar to dividends but are treated as tax-deferred returns of capital and require different paperwork come tax time.
BCE Inc.
- Market value: $41.4 billion
- Dividend yield: 6.1%
- Consecutive annual dividend increases: 13
- Analysts' opinion: 3 Strong Buy, 5 Buy, 9 Hold, 0 Sell, 1 Strong Sell
BCE (BCE, $45.74) is Canada's largest communications company, with annual revenue of C$22.9 billion. It generates approximately 50% of its sales from wireline broadband and TV, 38% from wireless, and the remaining 12% from its media operations.
The company has a two-year plan to accelerate the expansion of its fiber network, wireless home internet and 5G network across Canada. BCE's 5G network is present in more than 150 Canadian cities covering approximately 24% of its population. The company is paying for this expansion through the sale of data centers worth C$1 billion.
The company plans to add fiber and wireless home internet to as many as 900,000 homes and businesses in 2021, bringing its total footprint to more than 6.9 million homes and businesses across Canada.
BCE has raised its annual dividend by 5% or more for 13 consecutive years. It usually targets a payout ratio within a range of 65% to 75%, which is manageable though a little higher than many other Canadian dividend stocks on this list. However, thanks to COVID-19 and the accelerated capital spending plan, that payout ratio is temporarily higher than usual.
Franco-Nevada
- Market value: $24.0 billion
- Dividend yield: 1.0%
- Consecutive annual dividend increases: 13
- Analysts' opinion: 5 Strong Buy, 4 Buy, 9 Hold, 0 Sell, 0 Strong Sell
Franco-Nevada (FNV, $123.40) is different from most mining companies in that it doesn't own any mines. Instead, it finances mine developments for other companies in return for a portion of future revenue. As a royalty play, the harder it is for mining companies to get traditional financing for a project, the better the opportunity for Franco-Nevada.
In recent years, this commodity stock has diversified into oil and gas revenue streams; oil and gas now account for 11% of its revenue. Franco-Nevada generates 49% of its revenue from Latin America, 19% from the U.S., 19% from Canada and 13% from the rest of the world.
Franco-Nevada currently owns royalty and streaming rights for 56 gold properties, four of which generate most of its revenue. In the first quarter of 2021, Franco-Nevada's revenues were $240.5 million, 34% higher than a year earlier. It sold 134,941 gold equivalent ounces during the quarter, almost 11% higher than Q1 2020.
Since Franco-Nevada went public in 2007, it has paid out more than $1.2 billion in dividends and increased its annual payout every year. In 2020, it increased its dividend by 4% with June's quarterly payment of 26 cents per share.
Ritchie Bros. Auctioneers
- Market value: $6.5 billion
- Dividend yield: 1.5%
- Consecutive annual dividend increases: 17
- Analysts' opinion: 2 Strong Buy, 1 Buy, 5 Hold, 2 Sell, 0 Strong Sell
Ritchie Bros. Auctioneers (RBA, $59.51) helps individuals and businesses sell heavy equipment via more than 40 permanent auction sites in approximately 15 countries and through IronPlanet, its online marketplace that brings buyers and sellers together.
In August 2020, the company developed a new strategy to help its customers do a better job of acquiring the equipment they need to operate their businesses. The plan, which is an extension of their existing transaction-based auction business, will see Ritchie provide a more solutions-based approach.
In 2018, Ritchie Bros. sold $4.9 billion of other people's goods, getting a piece of the action on every transaction. By 2020, the company's gross transaction value (GTV) had increased to $5.4 billion. Revenues on those sales increased 4% year-over-year to $1.4 billion. Its service revenues accounted for 62% of its revenue, with inventory sales accounting for the rest.
Since 1980, Ritchie Bros. has grown its annual GTV at 11.0% annually.
In turn, the company has been generous with its cash. Most recently, it upped its quarterly payment to 22 cents per share for the September 2020 dividend. It simultaneously announced a $100 million share repurchase program over the next year.
In 2020, Ritchie Bros. repurchased $91.7 million of its stock and paid out $44.1 million in dividends.
Telus
- Market value: $26.2 billion
- Dividend yield: 4.9%
- Consecutive annual dividend increases: 18
- Analysts' opinion: 4 Strong Buy, 6 Buy, 4 Hold, 0 Sell, 0 Strong Sell
Telus (TU, $20.17) is a Canadian telecom company with C$15.5 billion in annual revenue. In 2020, Telus added 777,000 new customers, finishing the year with 16.0 million subscribers — 10.7 million wireless, 2.1 million high-speed internet, 1.2 million phone, 1.2 million TV, and 0.8 million security.
On Feb. 2, 2021, Telus took Telus International (TIXT) public, selling 37 million shares at $25. Post-IPO, Telus owns 67.8% of the provider of outsourced online customer service for international brands such as Uber Technologies (UBER) and Fitbit.
Since 2004, this Canadian dividend stock has returned more than C$19 billion to shareholders – the equivalent of C$15 per share. In 2020, it increased its annual dividend for the year to C$1.185, 5.2% higher than a year earlier.
Telus announced in 2019 that it planned to increase the dividend by 7% to 10% annually through the end of 2022. It targets an annual payout of 60% to 75% of its annual free cash flow. The company also split its stock 2-for-1 in March 2020.
Canadian Natural Resources
- Market value: $36.8 billion
- Dividend yield: 4.8%
- Consecutive annual dividend increases: 21
- Analysts' opinion: 8 Strong Buy, 10 Buy, 5 Hold, 0 Sell, 0 Strong Sell
Canadian Natural Resources (CNQ, $31.02) is one of the world's top independent energy producers, with natural gas, heavy crude oil and oil sands operations in North America and offshore operations in Africa and the U.K. In 2020, it produced a record 1.16 billion oil-equivalent barrels daily, 6% higher than a year earlier.
Despite a challenging year due to COVID-19, the independent energy producer managed to avoid layoffs by lowering capital investments while maintaining its production guidance for the year. It also reduced by 9% its annual operating costs per barrel for synthetic crude oil at its oil sands operations.
In 2020, it generated adjusted fund flows of C$5.3 billion. Excluding one-time items, it had annual free cash flow of C$690 million. Due to its strong free cash flow, the company announced an 11% increase in its annual dividend to C$1.88 per share. That marks the 21st consecutive payout hike for CNQ, at a clip of 20% annually over that time.
TC Energy
- Market value: $46.5 billion
- Dividend yield: 5.7%
- Consecutive annual dividend increases: 21
- Analysts' opinion: 7 Strong Buy, 11 Buy, 5 Hold, 0 Sell, 0 Strong Sell
TC Energy (TRP, $47.73) is a leading North American energy infrastructure company that began life in 1951 as TransCanada Pipeline. The company has operated under the TC Energy moniker since May 2019. It made the change to reflect that it has operations across North America – the U.S. and Mexico accounted for 53% and 6% of overall revenue in 2020, respectively – and not just in Canada.
The Calgary-based company owns one of the largest natural gas pipeline networks (58,000 miles of pipeline) in North America, capable of moving 25% of the continent's demand for natural gas. It is also one of the largest natural gas storage operators, with more than 653 billion cubic feet of capacity.
In addition to its natural gas pipelines and storage, it also transports crude oil through its Keystone Pipeline System. Since it began transporting crude oil in 2010, it has transported more than 3 billion barrels. It also owns seven power generation facilities that produce 4,200 megawatts of electricity, 75% of which is emission-free nuclear energy.
TRP has one of the longest payout-growth streaks among Canadian dividend stocks. Since 2000, the company has increased its annual dividend by 7% compounded annually, to its estimated C$3.48 per share in 2021. TC Energy most recently increased its quarterly dividend by 7%, to 87 Canadian cents per share. The company intends to grow the dividend by 5% to 7% annually for the foreseeable future.
Canadian National Railway
- Market value: $83.0 billion
- Dividend yield: 1.7%
- Consecutive annual dividend increases: 25
- Analysts' opinion: 3 Strong Buy, 6 Buy, 19 Hold, 1 Sell, 1 Strong Sell
Canadian National Railway (CNI, $116.84) is North America's second-largest publicly traded railway, with a network of almost 20,000 route miles transporting more than 300 million tons of natural resources, manufactured products and finished goods across North America each year.
In 2020, CN recorded annual revenues of C$13.8 billion, adjusted net income of C$3.8 billion, and free cash flow of C$3.2 billion – the last figure was 62% higher than in 2019.
Some of that cash went to shareholders; on Jan. 26, the company said it would increase its quarterly dividend by 7% to 61.5 Canadian cents per share. The company has increased its dividend every year since it went public in 1995. Its adjusted dividend payout in 2020 was a reasonable 43%.
In 2021, Canadian National Railway intends to repurchase up to 14 million of its shares outstanding. That represents approximately 2.4% of its total share count. Over the past 12 months through the end of January, CNI repurchased 16 million of its shares at a weighted-average price of $C113.53. Since 2000, it has purchased more than C$23 billion worth of its stock.
Enbridge
- Market value: $75.1 billion
- Dividend yield: 7.1%
- Consecutive annual dividend increases: 26
- Analysts' opinion: 9 Strong Buy, 12 Buy, 3 Hold, 1 Sell, 0 Strong Sell
Enbridge (ENB, $37.08) is a leading North American energy infrastructure company. It has five operating segments: Liquids Pipelines; Gas Transmission and Midstream; Gas Distribution and Storage; Renewable Power Generation; and Energy Services.
The company's pipeline business transports 25% of North America's oil. Its gas transmission business is responsible for transporting 20% of the natural gas in the U.S. through its pipelines; its natural gas distribution business is the largest utility of its kind based on annual deliveries, and its renewable energy segment generates approximately 1,800 megawatts of net renewable power in North America and Europe.
Enbridge's gas transmission, gas distribution and renewable energy segments delivered predictable results in 2020. The same can't be said for its liquid pipeline business, which saw significantly lower volumes due to COVID-19.
Despite the difficulties encountered in the segment, ENB's business improved dramatically in the fourth quarter. As a result, Enbridge's overall EBITDA rose by 39% to C$4.0 billion.
Over the past 26 years of increases, Enbridge has grown its annual dividend 10% on a compounded basis, putting it among the top Canadian dividend stocks in that respect. With its March 1 quarterly payment, investors now receive 83.5 Canadian cents per share.
Thomson Reuters
- Market value: $43.8 billion
- Dividend yield: 1.8%
- Consecutive annual dividend increases: 28
- Analysts' opinion: 3 Strong Buy, 5 Buy, 6 Hold, 2 Sell, 0 Strong Sell
Thomson Reuters (TRI, $88.52) is a business information service provider for legal, tax, accounting and compliance professionals. It also owns Reuters news service.
On Jan. 29, it announced Refinitiv had been sold to the London Stock Exchange Group (LSEG) in an all-stock transaction. Thomson Reuters holds 82.5 million shares in LSEG worth $11.2 billion as of Feb. 22. It plans to sell $1 billion of those shares for net proceeds of $750 million. It will hold the remaining shares until Jan. 29, 2023.
In 2020, Thomson Reuters reported $6.0 billion in revenue, 2% higher than in 2019, excluding currency. Its adjusted earnings per share rose 43% year-over-year to $1.85. Free cash flow increased by 735% to $1.3 billion.
In February, Thomson Reuters increased its annual dividend by 10 cents to $1.62 a share, the company's 28th consecutive year increasing it. At the same time, the company announced that it completed the buyback of $200 million of its shares under its normal course issuer bid at the start of 2021.
In the future, TRI plans to repurchase shares only to maintain approximately 500 million shares outstanding.
Fortis
- Market value: $20.2 billion
- Dividend yield: 3.7%
- Consecutive annual dividend increases: 47
- Analysts' opinion: 6 Strong Buy, 5 Buy, 6 Hold, 0 Sell, 0 Strong Sell
Fortis (FTS, $43.50) owns 10 utility operations in Canada, U.S. and the Caribbean, providing gas and electricity to more than 3.3 million customers. It is one of the top 15 utilities in North America. And its asset base has grown from $390 million at its incorporation in 1987 to $55 billion today.
The company gets 99% of its earnings from regulated utilities, which means those profits are relatively stable and benefit from steady rate increases. It's easy to see why Fortis has been able to increase its annual dividend for 47 straight years.
Fortis expects to spend C$19.6 billion on its five-year capital plan through 2025. In 2020, it invested C$4.2 billion in its system, increasing its rate base by 8% to 30.5 billion Canadian dollars. Its capital plan over the next five years will increase its rate base by approximately 33%.
FTS is tops among the Canadian dividend stocks on this list, boasting nearly a half-century of uninterrupted payout growth. Over the past decade, Fortis has kept its dividend payout ratio between 61% and 73%, ensuring it's not stretching to make its payments. It plans to improve its annual dividend by 6% through 2025.
