4 Dividend Stocks That Will Beat the Market in 2018

Sleep Country Canada Holdings Inc. (TSX:ZZZ) is a good bet to outperform the TSX, which has been sluggish to start 2018.

| More on:

The S&P/TSX Index has dropped 3% in 2018 as of close on March 16. This decade has seen retail investors flock into index funds and ETFs, but industry experts have started to sound the alarm over passive investing this year and beyond. Today, we are going to look at four dividend-yielding stocks that have outperformed the TSX in 2018 thus far and are in a good position to continue to do so.

Toronto-Dominion Bank (TSX:TD)(NYSE:TD)

TD Bank stock has climbed 3% in 2018 as of close on March 16. Shares are up 14.9% year over year. TD Bank boasts the largest footprint in the United States out of any other Canadian bank and stands to benefit from U.S. tax reform in 2018 and beyond.

The bank released its first-quarter results on March 1. TD Bank reported $405 million in tax charges related to U.S. tax reform, but this represents a one-time charge. In its U.S. Retail segment, TD Bank reported adjusted net income of $1.02 billion, which represented a 28% jump from Q1 2017. Overall adjusted earnings were up 15% year over year to $2.9 billion. TD Bank stock also offers a quarterly dividend of $0.67 per share, representing a 3.1% dividend yield.

Sleep Country Canada Holdings Inc. (TSX:ZZZ)

Sleep Country is a Brampton-based mattress retailer. Sleep Country stock has climbed 7% in 2018 so far. Shares are up 10.4% year over year. Sleep Country released its 2017 fourth-quarter and full-year results on March 1.

For the full year, revenue climbed 12.3% to $588 million, and gross profit jumped 15.6% to $175 million representing 29.8% of revenue. Sleep Country has adapted well to the evolving retail environment and in 2017 launched its e-commerce platform. The stock also offers a dividend of $0.165 per share, representing a 1.8% dividend yield.

Andrew Peller Ltd. (TSX:ADW.A)

Andrew Peller is a Grimsby-based company engaged in wine and wine-making products. Shares of Andrew Peller have climbed 18.8% in 2018 and have soared 75% year over year. Wine has surpassed beer as the favourite drink of the millennial generation, which recently passed the boomers as the most populous in North America.

The company released its fiscal 2018 third-quarter results on February 7. Adjusted EBITDA was up 27.5% year to date, and third-quarter sales rose 10.1% year over year. The company has reported impressive success in marketing its premium and ultra-premium brands so far this year. The stock has delivered a dividend of $0.76 in fiscal 2018 so far.

Sun Life Financial Inc. (TSX:SLF)(NYSE:SLF)

Sun Life is a Toronto-based financial services company. Shares of Sun Life have increased 6.6% in 2018 thus far, and the stock is up 12.3% year over year. Sun Life has a significant overseas footprint and has reported impressive growth in its Asia-based business. In the fourth quarter net income surged 43% year over year in Sun Life Asia as its wealth sales grew to $3.6 billion compared to $3.1 billion in Q4 2016.

Sun Life also declared a dividend of $0.455 per share, representing a 3.2% dividend yield.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Ambrose O'Callaghan has no position in any of the stocks mentioned.

More on Investing

open vault at bank
Dividend Stocks

Don’t Get Cute; Just Buy Stability: Top Defensive TSX Stocks to Buy Now

A healthy risk tolerance is essential for most investors, but many stray from the tried and tested, hoping to find…

Read more »

TFSA (Tax-Free Savings Account) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

TFSA Investors: Buy These 3 Stocks for $3,480 Yearly Tax-Free Income

One significant benefit of a TFSA-based dividend income is that it doesn’t weigh down your tax bill.

Read more »

a-developer-typing-lines-of-ai-code-while-viewing-multiple-computer-monitors
Tech Stocks

Could Constellation Software Become the Next Berkshire Hathaway?

Constellation Software's (TSX:CSU) capital-allocation strategy is similar to that of Berkshire Hathaway (NYSE:BRK.B).

Read more »

tsx today
Stock Market

TSX Today: What to Watch for in Stocks on Friday, November 8

The TSX Composite benchmark remains on track to end the week with strong optimism as it currently trades with 2.4%…

Read more »

Canadian dollars in a magnifying glass
Dividend Stocks

3 High-Yield Dividend Stocks That Are Screaming Buys Right Now

Are you looking for great income stocks? Here's a trio of high-yield dividend stocks that pay insane yields right now.

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Bank Stocks

Best Stock to Buy Right Now: TD Bank or Manulife Financial?

Manulife continues to see momentum in its business and stock price, while TD Bank stock remains down and out.

Read more »

cloud computing
Tech Stocks

3 No-Brainer Tech Stocks to Buy With $1,000 Right Now

These three Canadian tech stocks could be among the best growth opportunities in the market right now.

Read more »

Piggy bank with word TFSA for tax-free savings accounts.
Dividend Stocks

Transform a $5,000 TFSA Into a $50,000 Retirement Nest Egg

The TFSA is a powerful tool that can grow a small investment into a substantial retirement nest egg over time.

Read more »