High Dividend Stocks Canada: 5 of The Best

Here is our list of the top 5 high dividend stocks Canada that are perfect for those targeting the recent boom in the Canadian economy.

Top 5 High Dividend Stocks Canada For Investors

In Canada regulators recently allowed banks and insurers with more than 30% of the total market value of the Toronto Stock Exchange (TSX) to resume dividend hikes, pushing the market to new highs as restrictions on executive compensations and share buybacks were also lifted. 

18 companies on the TSX posted 52-week highs on November 5, according to a report by news agency Reuters. As several firms posted market-beating numbers, the positive sentiment around the Canadian economy was lifted by the earnings season.

The lifting of these limitations is also a sign that the Canadian economy has now emerged out of the COVID-19 crisis. The Canadian economy suffered from the restrictions on dividend hikes and share buybacks at the height of the virus panic at the hands of the Canadian government back in March 2020. 

Back then the Canadian government also relaxed the requirements for cash stockpiles at the banks to come up with a way to use the extra capital to lend loans to households and  businesses battling the pandemic. 

Barclays analyst John Aiken stated to The Star in October 2021 that large-cap banks could trigger a rise in dividends by up to 45% to match the standard targets. 

Those who are eager to profit from this boom in the Canadian economy as investors can look into some top value players in the Canadian market that have impressive yields. 

5 High Dividend Stocks In Canada 

The highest dividend top Canadian stocks consist of an array of big bank stocks, aristocrat dividend stocks, and some of the best monthly dividend stocks you can buy and hold in Canada.

5. Canadian National Resources Limited

one of the largest crude oil and natural gas producers in the world, Canadian National Resources is one of the contenders for the highest dividend on Canadian stocks. 

  • Dividend Yield: 4.42%
  • Dividend Payout Ratio: 52.03%
  • Market Cap: $51.67 billion
  • Symbol: CNQ.TO
  • Sector: Energy
  • Company locations: Canada, Côte D’Ivoire, United Kingdom, and Gabon

The company has operations which are a part of the “Oil Sands Pathway to Net Zero” initiative, 

Canadian Natural Resources (CNQ) has a forward dividend yield of 4.42% which is based on a current price of $43.76. 

The CNQ aims to achieve net-zero greenhouse gas emissions from its oil sands operations by 2050 and pays out just over half of its net earnings as dividends.

4. Bank of Nova Scotia

Sitting at the position of being the third largest bank in Canada, Scotiabank is one of the oldest, having been founded in 1832.

  • Dividend Yield: 4.61%
  • Dividend Payout Ratio: 58.06%
  • Market Cap: $95.13 billion
  • Symbol: BNS.TO
  • Sector: Financial Services

BNS (Bank of Nova Scotia) has offered its investors a dividend increase in 43 of the last 45 years. 

Such a high dividend stock from Canada also turns out to be one of the best and cheap dividend stocks as it has an asset base exceeding $1.1 trillion, and operations in Canada, the U.S., Europe, Asia, Mexico, and Australia. 

In Canada, BNS (Bank of Nova Scotia) also owns the country’s most popular online bank, Tangerine.

BNS (Bank of Nova Scotia)’s forward annual dividend yield of 4.61% stands out among the other banks and it has a dividend payout ratio of 58.06% (higher than average for the industry). 

The P/E ratio for BNS is 10.95 – as of October 2021. 

3. Royal Bank of Canada

Next up on our list of high dividend stocks Canada is none other than the largest bank in Canada based on market capitalization. 

  • Dividend Yield: 3.33%
  • Dividend Payout Ratio: 40.72%
  • Market Cap: $184.05 billion
  • Symbol: RY.TO
  • Sector: Financial Services

The Royal Bank of Canada (RBC) has:

  1. Over 17 million customers and operations in 36 countries,
  2. Earnings and asset base increasing in value for more than 50 years.
  3. A forward annual dividend yield of 3.33% 
  4. A P/E ratio of 12.17
  5. A payout ratio of 40.72%

RBC is also one of the best performing when it comes to Canadian banks. Keep a lookout for a significant increase in dividends in the near future.

2. Enbridge

This dividend aristocrat stock company has shares that have had a 10% compound annual growth rate (CAGR) over the last 26 years. Even better, the Canadian company has steadily paid dividends to its shareholders for over 67 years.

  • Dividend Yield: 6.62%
  • Dividend Payout Ratio: 109.67%
  • Market Cap: $102.85 billion
  • Symbol: ENB.TO
  • Sector: Energy

This high dividend stock from Canada has a stable business across North America and Enbridge’s business is Canada’s largest natural gas distribution network.

This dividend aristocrat stock company has a payout ratio of 109.67% and a forward dividend yield of 6.62% 

ENB has its significant cash flows that support a high dividend payout ratio exceeding 100% as the business includes pipelines for crude oil, natural gas transmission, gas utilities, and renewable energy.

  1. Fortis

Last but not least on our list of high dividend stocks Canada is Fortis Inc. was founded in 1885 in Newfoundland and Labrador.

  • Dividend Yield: 3.48%
  • Dividend Payout Ratio: 75.47%
  • Market Cap: $27.38 billion
  • Symbol: FTS.TO
  • Sector: Utilities

With outstanding documentation of increasing dividends for 47 consecutive years, Fortis has earned itself the right to be a strong contender for one of the highest dividend-paying stocks in Canada.

Today, as we all know Fortis Inc supplies electricity to 3+ million customers in various markets including Canada, the United States, and even towards the Caribbean.

The supply of electricity is a non-discretionary expense you spend for regardless of your budget, and therefore experts are willing to guarantee that Fortis will continue to enjoy significant growth in earnings for years to come.

These days Fortis Inc is  providing a dividend payout ratio of 75.47% with a forward dividend yield of 3.48%, in addition to the P/E ratio being 22.05.

The annual dividend growth rate as per the company’s forecast until 2025 is expected to be 6% on average.

Fortis is also working on decreasing its carbon footprint, with a plan to reduce carbon emissions by 80% at TEP by 2035, and lower greenhouse gas emissions by 30% at its BC operations by 2030.

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