Canadian stocks have been going through a rollercoaster for the last couple of years as high inflation and surging interest rates continue to hurt investors’ sentiments in the post-pandemic era. These are some of the key reasons why, despite starting 2023 on a firm note by rising more than 3% in the first quarter, the TSX Composite benchmark currently trades with only a minor 0.4% year-to-date gain.
While the latest round of stock market selloffs has made investors flee risky growth stocks, most investors are now looking for ways to earn passive income by investing in Canadian dividend stocks. And the good news is that many dividend stocks with strong fundamentals have witnessed a sharp correction lately, making them look undervalued to buy for the long term.
In this article, I’ll talk about one such attractive Dividend Aristocrat you can buy today on the Toronto Stock Exchange, especially if you’re looking to earn steady dividend income for years to come.
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One must-have Canadian dividends stock for your portfolio
When picking a dividend stock to invest in for the long term, you should never ignore its underlying fundamentals, which can tell you a lot about how its share prices might trend in the coming years. In addition, a stock with strong fundamentals and a robust business model can keep rewarding its investors with increasing dividends, even in difficult economic environments.
Considering that Enbridge (TSX:ENB) could be a very attractive TSX Dividend Aristocrat with a resilient business model, you can buy on the dip now. This top Canadian dividend stock currently trades at $44.70 per share with a market cap of $95 billion after diving by 15.5% in 2023 so far. On the positive side, these recent declines in its share prices have made its dividend yield even more attractive. The company’s annualized yield stands at 7.9% at the time of writing, and it distributes its dividend payouts every quarter.
What makes this Canadian Dividend Aristocrat a great buy now
If you don’t know it already, this Calgary-headquartered energy giant primarily focuses on its oil and gas transportation and distribution business. Besides that, Enbridge’s presence in renewable power and oil export segments is also gradually expanding.
Although most energy companies globally have faced big challenges due to the global pandemic and highly volatile material prices in the last few years, Enbridge’s financial growth trends have largely remained stable. To give you a quick idea, the company’s total revenue in the five years between 2017 and 2022 rows 20%. More importantly, its adjusted annual earnings during the same five years surged by 43%, reflecting its improving profitability, despite facing economic challenges in between.
Besides its strong financial performance over the years, Enbridge’s impressive dividend growth track record makes it even more attractive for income investors. Notably, the company has been raising its annual dividends for the last 28 years. As its strengthening presence in renewable energy and oil export segments is expected to strengthen ENB’s cash flows further, you can expect its dividends to continue growing in the long run, which can help you keep getting steady returns on your investments without worrying about temporary market downturns.
