Dividend-Yielding Blue Chips: Canada’s Prime Investment Opportunities

These blue-chip stocks offer investors major growth as well as dividends, as the market returns to normal. So, make sure to add them to your watchlist.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published November 20, 2023 4:20 pm EST

| More on: BCECSUFTS

Blue-chip companies are some of the best options for investors to pick up. And that’s in general. These are companies that have done well over decades and that aren’t going to merely disappear, even in the face of a pandemic, recession, or other market downturn.

So, that’s why we’re going to look at some of the top blue-chip stocks that also offer dividends — ones due to rise out from this volatility, offering a major dividend yield in the meantime. So, let’s get right to it.

A worker drinks out of a mug in an office. — Source: Getty Images

BCE stock

Shares of BCE (TSX:BCE) have fallen quite drastically over the last while, but it now looks to be a stock that investors should hop back on for a great deal. After all, BCE stock (or the Bell Company) has been around for four decades on the market but over 100 years as a company. In that time, it’s grown from producing telephones to being a major media organization.

However, a recent move by the Canadian Radio and Television Commission (CRTC) to increase competition left BCE stock and investors unhappy. The company reduced its growth for fibre-to-the-home (FTTH), as the CRTC stated large companies need to share their current FTTH to allow for competition.

Add in that the company saw some decreases in the last quarterly report, and shares have fallen by 14.5% in the last year. This could indeed create a great opportunity, however, for long-term investors. You can grab a 7.14% dividend yield as of writing while it trades at just 22.2 times earnings. So, it’s definitely one of the blue-chip stocks to consider.

Constellation Software

Granted, Constellation Software (TSX:CSU) may not look like a blue-chip stock with a seriously high dividend yield. But it does offer seriously high returns. And returns that should remain stable for the years to come.

This comes as Constellation stock passes the $3,000-per-share mark, even amid all this volatility. That’s because it’s a blue-chip stock offering essential software. The company has seen immense growth by acquiring companies and pushing them out for more revenue.

Sure, Constellation stock may have just a 0.17% dividend yield, but that comes with stable income through returns. In fact, shares of Constellation stock are up a whopping 54% in the last year alone. So, it’s another to consider on the TSX today.

Fortis

If you’re looking for the most stability possible, utility stocks offer that in spades. But among them, Fortis (TSX:FTS) may offer the best deal. Fortis stock is now one of just two stocks on the TSX today that hit Dividend King status. That’s 50 years of consecutive dividend increases. So, even as interest rates may hurt the stock somewhat, investors can be sure it will recover.

Why? Because it’s done it before — over and over again. While shares dropped after investors swarmed utility stocks during market volatility, it’s now offering a great deal. Fortis stock holds a dividend yield of 4.18%, which is far higher than the 3.64% average yield of the last five years. Further, shares are already up 6% in the last year, offering some returns as the market recovers. So, certainly consider this blue-chip stock as the market rebounds.