Investing in stocks that offer regular payouts is a good strategy, especially for investors who seek immediate income. While the stock market remains volatile, a few high-quality, dividend-paying stocks continue to pay and regularly increase their payouts in dollar terms, making them a dependable source of income irrespective of economic cycles.
Thankfully, the TSX has several top stocks that are reliable bets to start a passive-income stream. These companies have well-established businesses backed by solid fundamentals. Further, they generate resilient earnings and cash flows that support their payouts.
In this context, let’s explore a Canadian stock boasting an impressive track record of dividend payouts. Moreover, it offers a compelling dividend yield of more than 7.6%. But before discussing my top income stock, investors should note that dividends are not guaranteed. Thus, investors should diversify their portfolios to secure consistent income. Let’s delve deeper.
The top stock for immediate income
While the TSX has multiple stocks offering reliable dividends, one could consider investing in shares of Enbridge (TSX:ENB). The company operates an energy infrastructure business and transports and exports oil and natural gas. Furthermore, Enbridge owns a regulated natural gas utility business and is aggressively investing in renewable energy assets to grow its green energy portfolio.
Thanks to its solid asset base and crucial role in the energy value chain, Enbridge’s assets witness a high utilization rate. This, in turn, enables the company to consistently generate strong distributable cash flows (DCF), supporting its regular quarterly payouts.
It’s worth noting that Enbridge has a remarkable track record of regular dividend payments spanning over 69 years. Further, the company not only paid but also increased its dividend, even during economic downturns, which highlights the resilience of its payouts.
Recently, Enbridge announced a 3.1% increase in its dividend for 2024. The company now offers a quarterly payout of $0.915 per share, equating to an annualized dividend of $3.66. What stands out is that Enbridge increased its dividend for 29 consecutive years at a compound annual growth rate of 10%.
The company’s dividend-payout history suggests that Enbridge strongly emphasizes returning cash to its shareholders. Further, its target payout ratio of 60-70% of DCF is sustainable in the long term. All positives support my bull case and make Enbridge a top stock to earn immediate income.
Enbridge to increase its future dividend
Enbridge boasts a solid dividend payment and growth history. Moreover, its highly diversified cash flows, continued investments in conventional energy assets, and expansion of its renewables portfolio position it well to capitalize on growing energy demand and generate solid DCF. Further, its regulated cost-of-service tolling frameworks, power-purchase agreements, low-risk commercial arrangements, and multi-billion-dollar secured projects will likely drive its financials and payouts in the future.
Besides organic growth, Enbridge is poised to gain from its strategic acquisitions that will likely accelerate its growth and support its payouts.
Bottom line
Enbridge is a solid stock for investors seeking reliable income in all market conditions. The stock currently yields about 7.6%. Thus, an investment of $10,000 in Enbridge stock will enable you to buy about 209 ENB stocks near current levels and help you earn a quarterly income of approximately $191.24 or $764.96/year.
| Company | Recent Price | Number of Shares | Dividend | Total Payout | Frequency |
| Enbridge | $47.82 | 209 | $0.915 | $191.24 | Quarterly |
