Investing in dividend stocks can provide a steady income stream and long-term growth potential. The Canadian stock market offers plenty of opportunities for dividend investors, thanks to a mix of stability, long-term growth, and solid yields.
In this article, we are going to examine the best dividend investment opportunities available to Canadian investors right now.
List of the best Canadian dividend stocks in 2024:
Enbridge: 7.22% dividend yield
Bank of Nova Scotia: 6.46% dividend yield
Toronto-Dominion Bank: 5.14% dividend yield
Bank of Montreal: 4.56% dividend yield
Royal Bank of Canada: 3.79% dividend yield
Dividend yields are based on the trailing twelve-month periods.
The 5 best dividends stocks in Canada in 2024
In the following sections, we will examine the best Canadian dividend stocks. Please note that companies included in our list were filtered by market capitalization. We settled on companies with a market cap of at least 75 billion CAD to ensure maximum investment safety and stability, which are usually the most important factors for dividend investors.
1. Enbridge
Enbridge is a leading North American energy infrastructure company. It operates the world's longest crude oil and liquids transportation system and has a growing presence in natural gas distribution and renewable energy. The company is known for its reliable dividend payments, supported by stable cash flows from its extensive network of pipelines.
Enbridge's earnings per share increased by 124% in the trailing twelve-month (TTM) period, reflecting the company’s growing profitability. In addition, the price-to-earnings (P/E) ratio stands at 18.7, which is usually indicative of a business that’s fairly valued.
Sector: Industrial Services
Stock ticker: ENB
Stock price (1-year change): 49.57 CAD (+1.02%)
Market capitalization: 105.4 billion CAD
Dividend yield (TTM): 7.22%
2. Bank of Nova Scotia
The Bank of Nova Scotia, commonly known as Scotiabank, is one of Canada's Big Five banks. It offers a wide range of financial services, including personal and commercial banking, wealth management, and investment banking. The bank has a strong international presence and is one of the 50 largest banks in the world.
BNS’s price-to-earnings ratio is very healthy, sitting in the sub-11 range, which means that the company might be undervalued at the moment. The reason could be that the BNS stock lost about 7% in the past 5 years, which is a significantly worse performance than many competing financial institutions in the same time period.
Sector: Finance
Stock ticker: BNS
Stock price (1-year change): 65.59 CAD (-1.93%)
Market capitalization: 80.2 billion CAD
Dividend yield (TTM): 6.46%
3. Toronto-Dominion Bank
Toronto-Dominion Bank, or TD Bank, is another major Canadian bank with extensive operations in the United States. TD Bank provides a wide array of financial products and services, including retail and commercial banking, wealth management, private banking, and insurance.
Known for its conservative risk management and strong capital position, TD Bank offers a robust dividend yield of approximately 4-6%. Its solid financial performance and growth potential make it a cornerstone in many dividend portfolios, especially among Canadian investors.
Sector: Finance
Stock ticker: TD
Stock price (1-year change): 76.97 CAD (-0.40%)
Market capitalization: 136.4 billion CAD
Dividend yield (TTM): 5.14%
4. Bank of Montreal
Bank of Montreal, also known as BMO Financial Group, is one of the oldest banks in Canada. It operates across various financial services, including personal and commercial banking, wealth management, and investment banking.
BMO has a strong dividend history, with a yield of around 4-5%. The bank's focus on expanding its U.S. footprint and digital banking services positions it well for future growth.
Sector: Finance
Stock ticker: BMO
Stock price (1-year change): 130.82 CAD (+12.10%)
Market capitalization: 94.9 billion CAD
Dividend yield (TTM): 4.56%
5. Royal Bank of Canada
Royal Bank of Canada (RBC) is the largest bank in Canada in terms of market capitalization. It offers a comprehensive range of financial services, including banking, investment, and insurance products. RBC is renowned for its stability and profitability, which are supported by a diverse revenue stream and strong capital ratios.
With a dividend yield of about 4%, RBC is a reliable pick for dividend investors seeking consistent returns from a well-established institution.
Sector: Finance
Stock ticker: RY
Stock price (1-year change): 144.15 CAD (+18.40%)
Market capitalization: 203 billion CAD
Dividend yield (TTM): 3.79%
The bottom line
The companies included on our list are among the best dividend stocks in Canada for 2024, offering a combination of high yields, strong financial performance, and growth potential. When investing in dividend stocks, it's important to consider factors such as dividend sustainability, payout ratios, and overall financial health to ensure a steady and reliable income stream.
If you want to expand your portfolio with proven dividend stocks, check our list of the best long-term dividend stocks.