High-yield dividend stocks are an attractive investment for investors looking to generate stable passive income. For Canadian retirees, however, the goal isn’t just about getting the highest returns. It’s about finding reliable sources of income that can stand the test of time. That means focusing on companies with resilient business models, consistent profits and a long history of reliable dividend payments.
While no investment is completely risk-free, dividend-paying stocks, backed by strong fundamentals, tend to be less volatile and more reliable over the long term. They can help retirees maintain financial stability even in uncertain market conditions.
With this background, here are three high-yield dividend stocks for Canadian retirees.
High Yield Dividend Stock #1
SmartCentres REIT (TSX:SRU.UN), with a high yield of around 7% and reliable monthly payouts, is an attractive dividend stock for Canadian retirees to generate stable income. This real estate investment trust (REIT) owns high-quality properties that consistently witness high occupancy rates and rental demand. This translates into solid net operating income (NOI), which supports payouts.
The REIT operates 197 properties in prime locations across Canada. Thanks to this geographical advantage, SmartCentres sees strong demand for rental of its properties. In addition, the REIT consistently reports very high occupancy rates of over 98% and stable customer traffic, providing stability to the REIT’s revenue stream. SmartCentres’ high-quality tenants, including major retailers, further increase stability and ensure higher rent collection and retention.
SmartCentres is also expanding into mixed-use developments, which will expand its revenue base and add new growth opportunities. Additionally, leveraging its extensive land holdings in major Canadian cities will diversify and strengthen revenues, paving the way for future development projects. Overall, the trust is well positioned to generate stable cash flow and grow financial resources from its operations. Additionally, SmartCentres REIT’s strong balance sheet positions the company well to take advantage of growth opportunities and support sustainable dividend payments.
High Yield Dividend Stock #2
Canadian retirees can also consider investing Whitecap Resources (TSX:WCP) for a stable monthly income. This oil and gas producer has rewarded its shareholders with consistent monthly payouts, delivering high returns. Since January 2013, Whitecap has paid out approximately $2.7 billion in dividends. Moreover, it offers a yield of over 6.8%, backed by high-quality assets that generate stable cash flow.
Looking ahead, WCP’s focus on improving the use of its assets will help generate higher profitability and cash flow. By optimizing its drilling programs and maintaining a strong focus on operational efficiency, Whitecap is likely to generate stable earnings, which will support dividend payments.
Whitecap’s diverse portfolio of oil and gas assets allows management to allocate investments to projects with the highest potential returns, which bodes well for sustainable growth. Additionally, the company is focusing on increasing production capacity and adding high-quality assets to its portfolio through acquisitions, which will improve cash flow and position it well to support its monthly distributions.
High Yield Dividend Stock #3
With a high yield of approximately 5.8% and an excellent track record of consecutive dividend increases over 30 years, Enbridge (TSX:ENB) is a no-brainer stock for retirees. This energy infrastructure company’s well-diversified revenue base, long-term contracted assets, high utilization of its system and low-risk commercial arrangements enable the company to generate strong earnings and distributable cash flows (DCF) across all economic and commodity cycles. This allows the company to continue rewarding investors through stable dividend payments.
Enbridge’s investments in both traditional and renewable energy sources position the company well to benefit from rising energy demand. Furthermore, the focus on optimizing operations and exploiting expansion opportunities at low costs will boost DCF per share and dividend payments. Management expects mid-single-digit growth in earnings and DCF per share over the medium term, and has plans to increase dividends in line with DCF per share.
Furthermore, the company continues to maintain a dividend payout ratio of 60-70% of its DCF, ensuring it retains sufficient capital to reinvest in future growth projects while continuing to reward shareholders.
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