Retirees are faced with an increasingly difficult task in protecting an income stream that is both stable and resilient through market cycles. High yields are great, but often they lack the defensive reliability that retirees seek from Canadian dividend stocks.
That’s why some of the best options to consider are those businesses that provide essential services, generate regulated cash flows and have long histories of paying out dividends.
The market offers us plenty of great Canadian dividend stocks that are suited to that task. Here’s a look at a trio of options for retirees that meet those needs.
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Option 1: Enbridge
Enbridge (TSX:ENB) is one of the largest energy infrastructure companies in North America. The company operates pipelines, utility assets, and storage facilities that make it a defensive titan when it comes to distributing energy.
In fact, Enbridge hauls massive amounts of crude and natural gas across its network. So much so that it’s handily one of the most defensive stocks on the market. That checks the defensive appeal factor for retirees.
Enbridge’s cash flows are mostly regulated and backed by long-term contracts. This provides a recurring and stable revenue stream that allows the company to invest in growth and pay out an attractive quarterly dividend. Another check for generating cash flows.
Finally, that dividend carries a yield of 5.2%. Enbridge has also provided annual upticks to that dividend for three consecutive decades without fail. That’s another check for having a long history of payouts.
Reliable growing income backed by growing, defensive segments is a rarity on the market. This makes Enbridge a must-have option for retirees seeking Canadian dividend stocks.
Option 2: Fortis
Utility stocks like Fortis (TSX:FTS) are the literal definition of stability. Fortis is one of the largest regulated electric and gas utilities in North America. The company operates across multiple operating regions in the U.S., Canada and the Caribbean.
The bulk of Fortis’ revenue is derived from regulated long-term contracts that span decades. This allows the company to earn predictable returns, which leaves room for both growth and dividends.
On the growth side, Fortis has a large multi-year capital plan that is focused on investing in upgrading its facilities and transitioning to renewables.
Turning to income, Fortis offers a quarterly dividend with a yield of 3.2%. The company doesn’t offer the highest yield, but it’s consistent, resistant to market volatility, and growing.
The company has also amassed over 50 consecutive years of increases to that dividend. This makes Fortis one of just two Dividend Kings in Canada. That fact alone checks off the necessary boxes for retirees seeking reliable income from Canadian dividend stocks.
Option 3: CIBC
It’s hard to mention Canadian dividend stocks to own and not mention at least one of the big bank stocks. Canadian Imperial Bank of Commerce (TSX:CM) offers one of the highest dividend yields among Canada’s big banks, making it especially appealing for retirees who are seeking stable, growing income.
Unlike its larger big bank peers that offer growing international footprints, CIBC’s focus is more on the domestic market. That can be a net positive for investors seeking stability over aggressive expansion. Canadian banks operate in one of the most regulated and resilient financial systems in the world.
That stability allows CIBC to pay out a reliable, growing quarterly dividend. As of the time of writing, the yield on that dividend is a respectable 3.1%. And like the other Canadian dividend stocks mentioned above, CIBC has provided annual upticks to that dividend going back years.
Investors seeking a solid income that continues to grow will find CIBC a solid addition to any portfolio.
Canadian dividend stocks to own today
Retirees seeking income generation need a diversified foundation across essential services. The trio of stocks mentioned above offer exactly that.
Enbridge offers high yields and contracted cash flows. Fortis delivers unmatched dividend stability while CIBC adds financial-sector income with one of the best payouts across the big banks.
For retirees seeking dependable income and peace of mind, this trio offers a well-rounded, resilient approach to long-term dividend investing.