Notably, these low-volatility companies are less sensitive to market fluctuations and generate stable distributable cash flow, which supports strong dividend payments.
In this context, here are three Canadian stocks with very sustainable dividends. These companies have the financial strength to maintain and even increase payouts for years to come, making them the best choice for generating passive income.
Top Dividend Stocks No. 1: TC Energy
TC Energy (TSX:TRP) is one of the best Canadian stocks with very sustainable dividends. With a solid track record of increasing its dividend for 25 consecutive years, this energy infrastructure company has proven that its business model can weather market fluctuations while consistently rewarding shareholders.
The natural gas transporter generates stable revenues and maintains a stable cash flow profile throughout all market cycles. About 97% of revenues come from regulated activities or long-term take-or-pay contracts. This operating structure provides a solid foundation for dividend maintenance and growth in the years to come.
TC Energy’s extensive pipeline network plays a critical role in connecting low-cost natural gas to key regions in North America, ensuring stable infrastructure demand. Moreover, it also has growing exposure to nuclear, wind, solar and natural gas projects. This diversification positions TC Energy to benefit from the global transition to cleaner energy, increasing its long-term growth potential.
TC Energy’s investments in long-lived, low-risk projects will boost profits while supporting annual dividend growth of approximately 3% to 5%.
Top dividend shares no. 2: Fortis
Fortis (TSX:FTS) is another attractive dividend stock with sustainable payouts. It has increased its dividend for 52 years in a row, thanks to its stable, rate-regulated utility business, which is largely focused on the transmission and distribution of electricity.
Looking ahead, Fortis’ payouts are sustainable, backed by regulated assets and predictable cash flow. Furthermore, the company is well positioned to benefit from rising electricity demand and the broader shift to clean energy.
Fortis’ $28.8 billion capital program will help improve and expand its interest rate base, supporting earnings and dividend growth. Management expects this investment to grow the company’s interest base by approximately 7% per year through 2030. This sets the stage for sustainable dividend increases, with Fortis expecting annual dividend growth of 4% to 6% over the next ten years.
Top Dividend Stocks No. 3: Emera
Investors can rely on it Accept (TSX:EMA) stocks for sustainable dividends. Emera has increased its dividend for 19 years in a row. The company’s payouts are supported by regulated utilities, which provide reliable cash flow.
Emera’s $20 billion capital program through 2030 is expected to grow its interest base 7% to 8% annually. This expansion is expected to boost earnings growth of 5% to 7% per year, laying a solid foundation for dividend increases. The company plans to increase its dividend by 1% to 2% annually over the next few years, supported by its steadily growing earnings base.
Emera is expanding its solar capacity, modernizing the Tampa Electric grid and improving energy storage and transmission infrastructure in Nova Scotia. These initiatives strengthen the company’s operational capabilities and are expected to boost earnings and cash flow over time.
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