Income Investors: 3 Stocks With Reliable Dividends and 5-6% Yields

Keyera Corp. (TSX:KEY) and two other top dividend stocks appear oversold today.

| More on:

Income investors are constantly searching for companies that pay reliable and growing distributions.

Some businesses even give investors a piece of the profits on a monthly basis, which is great for retirees who are searching for cash flow to complement their pensions.

Let’s take a look at three stocks that might be interesting picks for an income portfolio today.

Keyera (TSX:KEY)

Keyera is one of Canada’s largest players in the midstream energy sector. The company has operations all along the value chain, including gas and liquids gathering, processing, storage, transportation, and marketing.

Growth continues with $2.4 billion in approved capital projects. As the new assets go into service, cash flow should increase enough to support ongoing dividend hikes. Keyera’s payout ratio is 56% over the past 12 months and the company has a compound annual dividend-growth rate of 8% over the past 15 years.

The monthly distribution of $0.15 per share currently provides an annualized yield of 5.5%.

BCE (TSX:BCE)(NYSE:BCE)

BCE just reported strong results for Q3 2018. Adjusted net earnings increased 4.5% compared to the same period last year, supported by the addition of 266,000 new wireless, TV, and internet customers. The company’s fibre-to-the-premises roll-out has now connected 4.4 million homes and businesses in seven provinces.

BCE generated $1 billion in free cash flow in the third quarter and remains on track to hit all of its financial targets for 2018. The board raises the payout every year, and that trend should continue in step with free cash flow growth.

The current dividend provides a yield of 5.9%.

Power Financial (TSX:PWF)

Power Financial is a holding company with interest in some of Canada’s leading insurance, wealth management, and asset management businesses.

The company reported record adjusted net earnings for Q2 2018, supported by solid performances from its Great-West Lifeco and IGM Financial subsidiaries. Rising interest rates are here to stay, and that tends to be good for insurance companies, as they can generate better returns on funds invested in fixed-income holdings.

Power Financial raised the dividend by 5% earlier this year, and investors should see another increase in 2019. The current yield is 6.1%.

The bottom line

Keyera, BCE, and Power Financial all pay attractive dividends that should continue to grow. If you have some cash available, these stocks might be good picks today for an income-focused TFSA portfolio.

Other top picks are also worth considering after the recent pullback.

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 Andrew Walker owns shares of BCE.

More on Dividend Stocks

Female raising hands enjoying vacation, standing on background of blue cloudless sky.
Dividend Stocks

CRA Update: The Basic Personal Amount Just Increased in 2025!

The BPA just increased, leaving Canadians with more cash in their pockets and room to make more cash!

Read more »

dividends can compound over time
Dividend Stocks

3 Defensive Stocks That Could Thrive During Economic Uncertainty

Discover how NextEra Energy, Brookfield Renewable, and Enbridge combine essential services with strong dividends to offer investors stability and growth…

Read more »

hand stacks coins
Dividend Stocks

Canada’s Smart Money Is Piling Into This TSX Leader

An expanding and still growing industry giant is a smart choice for Canadian investors in 2025.

Read more »

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

TFSA Contribution Limit Stays at $7,000 for 2025: What to Buy?

This TFSA strategy can boost yield and reduce risk.

Read more »

Make a choice, path to success, sign
Dividend Stocks

Already a TFSA Millionaire? Watch Out for These CRA Traps

TFSA millionaires are mindful of CRA traps to avoid paying unnecessary taxes and penalties.

Read more »

Canada Day fireworks over two Adirondack chairs on the wooden dock in Ontario, Canada
Tech Stocks

Best Tech Stocks for Canadian Investors in the New Year

Three tech stocks are the best options for Canadians investing in the high-growth sector.

Read more »

Happy golf player walks the course
Dividend Stocks

Got $7,000? 5 Blue-Chip Stocks to Buy and Hold Forever

These blue-chip stocks are reliable options for investors seeking steady capital gains and attractive returns through dividends.

Read more »

Concept of multiple streams of income
Stocks for Beginners

The Smartest Dividend Stocks to Buy With $500 Right Now

The market is flush with great opportunities right now, and that includes some of the smartest dividend stocks every portfolio…

Read more »