To each of these, we awarded three scores based on publicly available data:
- The yield score reflects both the current dividend yield and the growth of the dividend over the past five years.
- The stability score takes into account the companies’ debt-to-equity ratio, return on equity, five-year earnings growth, and ratio of earnings per share to dividends.
- The valuation score considers the stock’s earnings yield (the inverse of price-to-earnings) and price-to-book value.
We then added up all three scores to determine each stock’s total score, giving a 40% weighting to each of the yield and stability scores and a 20% weighting to valuation. The data used to score the securities was collected and was current as of Nov. 30, 2023.
The full list of the Top 100 dividend stocks represents the lowest-scoring 100 stocks out of the 176 eligible. Top performers earn the lowest scores, reflecting their relative rank under each of the criteria.
From that, we derived the letter-grade system and the A-Team and B-Team of Canada’s 20 best dividend stocks, detailed in our Best dividend stocks in Canada for 2024 overview. The A-Team companies scored well for all three criteria. The B-Team represents companies also worth looking at to fill stock sector gaps in a portfolio. Companies with higher scores tended to fall short on one or more of our measurement criteria, but they still had attributes superior to those excluded from the list of 100. Keep in mind this methodology does not consider all aspects of a stock’s suitability for your portfolio. It does not take into account factors such as the quality of a company’s management, brand equity or whether the company has a competitive “moat.” These best dividend stocks we’ve identified are meant to be a starting point for further due diligence. To see how our 2023 top dividend stocks performed, check out the top dividends past performance summary.