TFSA: 2 TSX Stocks for Your $7,000 Contribution

These stocks offer high dividend yields for income investors.

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Blocks conceptualizing Canada's Tax Free Savings Account

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Retirees and other income investors are wondering which dividend stocks in the TSX might be good to buy right now for a self-directed Tax-Free Savings Account (TFSA) focused on passive income.

Bank of Nova Scotia

Bank of Nova Scotia (TSX:BNS) trades near $75 per share at the time of writing compared to $93 three years ago. The stock, however, is up about 20% in the past 12 months.

Bank of Nova Scotia rebounded in the past year along with most other bank stocks on reduced market concerns that higher interest rates would drive the economy into a deep recession. Rate cuts by the Bank of Canada in the second half of last year provided some relief for borrowers with variable-rate loans. Investors are hoping that provisions for credit losses (PCL) at the banks will start to decline in 2025 as a result of lower rates.

Where rates will actually go this year is still unknown. Bond yields remain elevated, putting upward pressure on rates for fixed-rate mortgages. The Bank of Canada is expected to continue cutting rates this year to try to avoid a recession, but the cuts might not be as numerous as previously expected. That could change, however, if Donald Trump imposes widespread tariffs on Canadian goods.

Volatility should be expected, but Bank of Nova Scotia remains very profitable and has ample capital on hand to ride out some turbulence. Investors who buy BNS stock at the current level can get a dividend yield of 5.65%.

Enbridge

Enbridge (TSX:ENB) trades near its record high. The energy infrastructure giant now has a market capitalization of $140 billion and continues to grow through acquisitions and development projects.

Enbridge spent US$14 billion last year to buy three natural gas utilities in the United States. The company is now the largest natural gas utility operator in North America and is positioned well to benefit from the anticipated surge in natural gas demand as fuel for new power-generation facilities being built to supply electricity to large artificial intelligence data centres. Enbridge’s natural gas transmission system already moves about 20% of the natural gas used in the United States.

On the oil side, the company’s pipelines transport roughly 30% of the oil produced in the U.S. and Canada. Enbridge purchased an oil export terminal in Texas a few years ago to give it exposure to rising international demand for American oil. The company is also a partner in the Woodfibre liquified natural gas (LNG) export facility being built on the coast of British Columbia.

Enbridge is working on a $27 billion capital program to drive additional revenue and cash flow growth. This should support steady dividend hikes. The board has increased the dividend for 30 consecutive years. Investors can currently get a dividend yield of 5.9% from ENB stock.

The bottom line on top TSX dividend stocks

Bank of Nova Scotia and Enbridge are good examples of TSX stocks with good dividends that should continue to grow. If you have some cash to put to work in a TFSA focused on passive income, these stocks deserve to be on your radar.

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.

The Motley Fool recommends Bank Of Nova Scotia and Enbridge. The Motley Fool has a disclosure policy. Fool contributor Andrew Walker has no position in any stock mentioned.

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