Search

Dividend Titans: 2 Canadian Stocks Deserving Your Respect!

It’s still an excellent period for those seeking passive income.

investor

With dividends from stock payouts and REITs remaining quite generous, coupled with an increase in various covered call ETF options, Canadian investors looking to generate income without depleting their principal have plenty of choices. This article will explore four dividend stalwarts that I think deserve a place in your long-term investment strategy.

Chasing greater returns can be perilous without thorough research and preparation ahead of time. An extremely high yield may not be as advantageous if it rests on shaky ground (consider a poor financial statement or insufficient growth during difficult periods). In fact, it’s much wiser to opt for a modest return that is securely covered rather than taking a significant risk with a very high yield that could easily lead to a cut in dividends.

Here are two top-notch dividend stocks, in my opinion, that definitely deserve recognition!

Telus

Telus

(

TSX:T

It has faced a challenging last three years, yet it has managed to navigate the turbulence somewhat better compared to others in the telecommunications industry. Currently, I see Telus as one of the more favorable options for those seeking dividends with lower costs involved. At the moment of this writing, the yield stands at 7.6%. This substantial yield appears more likely to increase rather than decrease.

As the Bank of Canada considers reducing interest rates even more, and as the company keeps enhancing its operational efficiency and investing in its infrastructure, Telus might possess all the necessary components for its stock price to stabilize sometime within the coming two years. Timing this recovery accurately can be challenging, though. Fortunately, catching the exact moment when prices hit their lowest isn’t essential since investors stand to benefit greatly from attractive dividends that may become increasingly appealing if share values decline slightly further.

Will Telus’s dividend be sent to the chopping block if shares can’t reverse course in 2025? Personally, I don’t think so, especially if rate cuts arrive and subscriber growth looks upward.

Suncor Energy

Suncor Energy

(

TSX:SU

It offers a more affordable option to invest in the Canadian energy sector. The stock trades at only 10.3 times its trailing price-to-earnings ratio and comes with a 4.6% dividend yield. It’s worth noting that Suncor usually commands a lower valuation compared to several of its counterparts in the industry. However, I believe there might be room for an increase in its multiples as the firm improves its operational efficiency across the board.

In the initial quarter, Suncor reported increased production and refining throughput. It appears that Suncor is operating at full capacity. Despite the stock’s lack of movement over the past three years, I remain optimistic.

new

Income seekers have good cause to remain loyal to this company. Given its strong potential for growing dividends and relatively low entry cost, I wouldn’t be astonished if Suncor manages to surpass its competitors over the next few years, particularly since the ongoing challenges in the oil sector persist.

The post

Dividend Champions: 2 Investment Heroes Deserving Your Respect!

appeared first on

The Motley Fool Canada

.

More reading

• 
  TSX Reaches Peak Levels: Discover What’s Affordable and Truly Worth Purchasing
  
• 
  Where to Put $11,200 in the TSX Market Currently
  
• 
  Could This Be the Perfect Opportunity for You? Discover Canada’s Top 3 Discounted Dividend Stocks Today!
  
• 
  Where to Put $8,700 in the TSX Market Currently
  
• 
  3 Top Dividend Stocks to Consider Purchasing This May
  

Fool contributor

Joey Frenette

has no holdings in any of the aforementioned stocks. The Motley Fool endorses TELUS. The Motley Fool has a

disclosure policy

.