3 TSX Stocks With 25 Years of Consecutive Dividend Growth

TSX stocks like Enbridge (TSX:ENB) should be on your Dividend Aristocrats watchlist.

| More on:
grow money, wealth build

Image source: Getty Images

One of the clearest signals of value creation is steady dividend growth. If a company can not only maintain but also expand its shareholder payouts every year, it’s verifiably swimming in cash. That’s why investors can safely bet on Dividend Aristocrats — stocks that deliver several years of consecutive dividend growth. 

Here are the top three TSX stocks with dividend-growth records that stretch beyond 25 years. 

Enbridge

Energy exports are a critical part of Canada’s economy. But most investors are too focused on energy production, while I believe energy transportation is a much safer way to make money. Transporting energy is an infrastructure business, which means it requires hefty upfront investments but delivers steady long-term returns once completed. 

That’s the business model Enbridge (TSX:ENB) has deployed successfully for decades. The Calgary-based company owns and operates the largest network of oil and gas pipelines across North America. 

It’s a business that’s on track to generate $15.9 billion to $16.5 billion in EBITDA (earnings before interest, taxes, depreciation, and amortization) in 2023. Management also expects to generate $5.25 to $5.65 in distributable cash flow per share. That’s roughly 10% of the current stock price. 

Enbridge offers a dividend yield of 6.55%. That’s being raised by 3% this year, marking the 28th consecutive year of dividend growth for the energy giant. This Dividend Aristocrat certainly deserves a spot on your income-oriented watch list. 

Canadian National Railway

The railway business is another infrastructure play. Staggering investments made decades ago are still paying dividends today. That’s why Canadian National Railway (TSX:CNR) has such an impeccable dividend track record. The company is on track for its 27th consecutive dividend hike this year. 

CN Rail operates a vast 35,000 km network of railway tracks across the U.S. Midwest and Canada. The network also links up with three coasts: the Atlantic, the Pacific and the Gulf of Mexico. 

The company beat earnings expectations last year. It delivered $1.93 in earnings per share instead of the $1.75 analysts were expecting. This year could be tougher as the world faces a recession. However, CN Rail’s network is an essential part of the supply chain for automobiles, fertilizers, crude oil, and industrial chemicals. That puts it in a favourable spot despite the economic headwinds. 

CN Rail offers a 2% dividend yield and is expected to hike its dividend again this year. Keep an eye on it. 

Canadian Western Bank

Besides railways and crude, Canada’s economy is also famous for supplying capital. Our banks are some of the biggest and most well managed in the world. The Big Five get all the attention, but smaller banks like Canadian Western Bank (TSX:CWB) have also delivered respectable returns over the years. 

This mid-sized bank is focused on niche opportunities in the Canadian banking sector. Instead of focusing on Ontario and mortgage lending, much of this bank’s loan book is dominated by commercial borrowers in Western Canada. That’s a more volatile part of the economy but offers better yields than vanilla mortgages and credit cards.

Meticulous risk management has allowed the bank to hike dividends every year for over 30 years. The stock now offers a dividend yield of 4.6% and trades at just 8.25 times earnings per share. It’s an undervalued Dividend Aristocrat that deserves a prime spot on your watch list. 

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 Vishesh Raisinghani has no position in any of the stocks mentioned. The Motley Fool recommends Canadian National Railway, Canadian Western Bank, and Enbridge. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Paper Canadian currency of various denominations
Dividend Stocks

Should You Buy the 3 Highest-Paying Dividend Stocks in Canada?

A few dividend stocks saw a sharp correction in November, increasing their yields. Are they a buy for high dividends?

Read more »

money while you sleep
Dividend Stocks

Buy These 2 High-Yield Dividend Stocks Today and Sleep Soundly for a Decade

These stocks pay attractive dividends that should continue to grow.

Read more »

Pile of Canadian dollar bills in various denominations
Dividend Stocks

$15,000 Windfall? This Dividend Stock Is the Perfect Buy for Monthly Passive Income

If you get a windfall, after debt investing should be your next top option to create even more passive income!

Read more »

senior relaxes in hammock with e-book
Dividend Stocks

3 Canadian Dividend Stocks for Worry-Free Income

These Canadian stocks have consistently paid dividends, generating a worry-free passive income for investors.

Read more »

people relax on mountain ledge
Dividend Stocks

Invest $10,000 in This Dividend Stock for a Potential $4,781.70 in Total Returns

A dividend stock doesn't have to be risky, or without growth. And in the case of this one, the growth…

Read more »

ETF chart stocks
Dividend Stocks

2 Top TSX ETFs to Buy and Hold in a TFSA Forever

Don't get crazy. Just think simple growth with these two ETFs that are perfect in any TFSA.

Read more »

ETF stands for Exchange Traded Fund
Dividend Stocks

How to Use Your TFSA to Earn $900 Per Month in Tax-Free Income

This covered call ETF plus a TFSA could be your ticket to high tax-free passive income.

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

How to Turn a $15,000 TFSA Into $171,000

$15,000 may not seem like a lot, but over time that amount can balloon into serious cash.

Read more »