The best dividend stocks in Canada 2024
Here’s our list of the top dividend stocks of 2024. Use this ranking as a tool to help you identify the companies that offer the best investment potential now, based on yield, stability and value.
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Here’s our list of the top dividend stocks of 2024. Use this ranking as a tool to help you identify the companies that offer the best investment potential now, based on yield, stability and value.
It has been a lousy couple of years for dividend investors in Canada. First, the stock market meltdown of 2022 destroyed capital for most stock investors, then rising bond yields in 2023 served to lure investors’ money out of dividend stocks. If you had a selection of Canadian dividend payers at the start of 2022, it’s quite possible they’ve experienced a capital loss. The Dow Jones Canada Select Dividend Index had an annualized rate of return of -0.11% for the two-year period ending Dec. 31, 2023.
The good news, though, is that the field of dividend stocks today is looking lean and fit in terms of both yield and valuation, which could position Canadian dividend investors to reap gains in 2024.
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A few years ago, you could count on your hands the number of Canadian large caps paying a 5% dividend. Today, that rate looks almost ordinary. The forward yield on the S&P/TSX Composite Index is 3.3%. That’s taking in some 240 stocks, some of which pay no dividends at all. Just think of the payouts if you decided to be more discerning. With elevated bond yields nipping at their heels, the 176 dividend payers in the S&P/TSX Composite Index average a 3.82% yield. The MoneySense Top 100 dividend stocks in Canada best dividend stocks come out at 3.16% on an equal-weight basis.
That means a couple of things.
First, it would take another year of 3%-plus capital losses for dividend investors to post negative total returns this year.
Second, if—as the market consensus seems to think—interest rates have now topped out and central banks start cutting rates within the next 12 months, bond yields should decline and stocks’ risk premium will look more and more attractive. This would be a signal for conservative investors to shift some money back into dividend stocks, ultimately supporting their prices.
Using the best dividend stocks methodology of taking not just their yield but also stability and valuation into account, we once again identified Canada’s 100 best dividend stocks. We then narrowed down that list to create an A-Team and a B-Team, each containing 10 dividend all-stars. This year’s A-Team skews heavily to the materials and energy sectors. It includes just two non-resource outliers: insurer and asset manager iA Financial Corp. and technology stock Enghouse Systems.
What pops out at first glance of the top ranks is the absence of what usually comes to mind for dividend stocks: banks, utilities, telecoms, pipelines, and real estate investment trusts (REITs).
“The financials have been really out of favour,” says Aman Raina, an investment coach and founder of Sage Investors, who compiled the 2024 list of top dividend stocks. Where they fell short in the calculations was mostly on measures of profitability.
However, he thinks Canadian investors have to expect some turnover, given the reversal in macroeconomic conditions that we’ve seen over the past two years. “We were living in a world with practically zero interest rates,” Raina says. Canadian investors had to take on more risk to get decent yields from their investments.
Today, investors can find virtually risk-free investments with a 5% yield. That’s going to reshuffle the deck somewhat.
“The commodity-type companies are showing up [with better scores] on a valuation perspective,” Raina says. “It could set them up nicely for [investment gains] this year because if rates go down and, more specifically, if the U.S. dollar goes down, that could provide a tailwind for some of these commodity stocks.”
Those seeking more sectoral diversification will want to check out our B-Team. These stocks are almost as promising, by our criteria, and with their greater industrial diversity, they can help fill any gaps in your portfolio. (As our past dividend performance summary shows, last year’s B list actually far outperformed the A list.)
What the numbers appear to be saying is that 2024 might be a year to lean into natural resources. “Going into this [process], I’m not trying to skew it to get a certain outcome. We’re just running the factors, and whatever comes out, comes out,” Raina says. “The theme is, right now, commodity stocks might be undervalued and provide an opportunity.”
To view all the data in the table, slide the columns right or left using your fingers or mouse. You can filter or rearrange the rankings by using the search tool or clicking on column headings. You can also download the data to your device in Excel, CSV and PDF formats.
wdt_ID | Rank | Symbol | Stock name | Price (as of Nov. 30, 2023) | Dividend yield | Yield score | Stability score | Valuation score | Total score | Grade |
---|---|---|---|---|---|---|---|---|---|---|
1 | 1 | LIF-T | Labrador Iron Ore Royalty Corp. | $31.44 | 8.89% | 4.8 | 1.2 | 9.6 | 15.6 | A |
2 | 2 | AEM-T | Agnico Eagle Mines Ltd. | $72.85 | 2.95% | 4.4 | 10.4 | 8 | 22.8 | A |
3 | 3 | ERF-T | Enerplus Corp. | $21.55 | 1.55% | 10.8 | 12.4 | 1.4 | 24.6 | A |
4 | 4 | IMO-T | Imperial Oil Ltd. | $76.45 | 2.56% | 8.8 | 13.6 | 5.4 | 27.8 | A |
5 | 5 | AGI-T | Alamos Gold Inc. Class A | $20.11 | 0.68% | 2 | 3.6 | 23.4 | 29 | A |
6 | 6 | IAG-T | IA Financial Corporation Inc. | $90.61 | 3.26% | 13.6 | 15.6 | 4.2 | 33.4 | A |
7 | 7 | LUN-T | Lundin Mining Corp. | $9.40 | 3.87% | 4 | 16.4 | 14.6 | 35 | A |
8 | 8 | ABX-T | Barrick Gold Corp. | $23.84 | 2.29% | 2.4 | 4 | 29.8 | 36.2 | A |
9 | 9 | FM-T | First Quantum Minerals Ltd. | $11.11 | 1.85% | 0.4 | 29.2 | 6.8 | 36.4 | A |
10 | 10 | ENGH-T | Enghouse Systems Ltd. | $34.08 | 2.56% | 9.2 | 6 | 21.4 | 36.6 | A |
Rank | Symbol | Stock name | Price (as of Nov. 30, 2023) | Dividend yield | Yield score | Stability score | Valuation score | Total score | Grade |
wdt_ID | Rank | Symbol | Stock name | Price (as of Nov. 30, 2023) | Dividend yield | Yield score | Stability score | Valuation score | Total score | Grade |
---|---|---|---|---|---|---|---|---|---|---|
1 | 11 | CNQ-T | Canadian Natural Resources Ltd. | $90.61 | 4.44% | 5.6 | 18.8 | 12.6 | 37 | B |
2 | 12 | CVE-T | Cenovus Energy Inc. | $24.07 | 2.33% | 8.4 | 21.2 | 10 | 39.6 | B |
3 | 13 | MFC-T | Manulife Financial Corp. | $26.58 | 5.44% | 20.4 | 19.2 | 0.8 | 40.4 | B |
4 | 14 | RCH-T | Richelieu Hardware Ltd. | $43.00 | 1.39% | 9.6 | 12.8 | 18.4 | 40.8 | B |
5 | 15 | LNR-T | Linamar Corp. | $57.61 | 1.51% | 18 | 20 | 3 | 41 | B |
6 | 16 | TECK-B-T | Teck Resources Ltd. Class B | $51.12 | 0.99% | 8 | 22.8 | 10.4 | 41.2 | B |
7 | 17 | WPM-T | Wheaton Precious Metals Corp. | $66.35 | 1.22% | 14 | 3.2 | 26.2 | 43.4 | B |
8 | 18 | TIH-T | Toromont Industries Ltd. | $109.50 | 1.56% | 10.4 | 17.6 | 16.2 | 44.2 | B |
9 | 19 | WFG-T | West Fraser Timber Co. Ltd. | $98.42 | 1.51% | 3.2 | 8.8 | 32.4 | 44.4 | B |
10 | 20 | FRU-T | Freehold Royalties Ltd. | $13.93 | 7.64% | 18.8 | 12 | 14.8 | 45.6 | B |
Rank | Symbol | Stock name | Price (as of Nov. 30, 2023) | Dividend yield | Yield score | Stability score | Valuation score | Total score | Grade |
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Hi Michael,
FM-T passed the test, really? I was very surprised to see that in your lists, especially A list!
I also didn’t understand how ERF is at # 3 and CNQ/CVE are way down at #11 and 12.
Anyway solid list otherwise.
Thanks for the article.
Best wishes.
Mano
Hi
Where is the whole top dividends stock list?
Hi Albert, You can find the full list here: https://www.moneysense.ca/save/investing/stocks/top-100-dividend-stocks/
team a —-it looks to me like you are saying Natural Resource is the best sector and the named stocks
are the favourites with the best Divedend
Re: 2023 A-Team & B-Team Performances
Its not stated, how did the A-Team & B-Team perform in 2023?
Ouchie wawa! For 2023, your A-Team had an average price appreciation of 1.15%, plus an average dividend yield of about 3.05%, for a total return 4.20%. Your B-Team was a little more respectable with an average price appreciation of 11.20%, plus an average dividend yield of about 2.80%, for a total return of 14.00% during 2023.
However, my preference is to focus on ‘total return’ with dividenders that are and have been exhibiting persistent and growing price & dividend growths over the last 1-year, 5-years, and 10-years, with no negative price returns during these periods. For my Tier-1’s, I like price appreciation to exceed 10% but preferably over 20%, as well as generally high levels of dividend growth. For my Tier-2’s, I like price appreciation to generally exceed 10%, and have reasonable dividend growth. For my ‘total return’ approach, I am willing to relax the dividend growth rate for a stronger price appreciation, as I am trying to grow my forest of trees in order to produce more fruit (income) in the future.
With my general hurdle rates, the 2023 results for the stocks in my two Tiers are as follows:
Tier-1: ATD, CNQ, CSU, DOL, EQB, FSV, GSY, SJ, TCS, and TFII
Price appreciation of 39.4%, average dividend rate of 1.4%, for total return of 40.8%.
Tier-2: ADEN, BYD, GCG.A, IAG, IMO, LGT.B, NA, RBA, TIH, TRI, WCN
Price appreciation of 20.6%, average dividend yield of 2.0%, for a total return of 22.6%.
It is important that my dividenders continue to show strong and persistent growth, otherwise I prune to preserve the overall health and growth prospects of the Tiers. I also keep watch for up-and-coming stocks that are showing ‘increasing’ price & dividend growth rates over multiple years as prospective substitutes when needed.