In addition to trade uncertainty, geopolitical risks have also increased. The Trump administration launched a tariff war last year and increased geopolitical risks in 2026 after a military intervention in Venezuela.
Given these headwinds and market prospects, prioritizing stable income over capital growth is a good strategy against potential volatility. For passive income generation and defensive positioning, two Canadian dividend giants are important buys for 2026.
More than a giant
Fortis (TSX:FTS) is a dividend giant, but not because of a high dividend yield. Instead, the term ‘giant’ equates to ‘king’. This top-notch utility wears a crown for its rock-solid reliability. FTS has raised dividends for 52 years in a row. If you invest today, the stock price is $72.28, while the dividend offer is 3.5%.
An attractive aspect of Fortis is its sustainable, regulated growth strategy. The $36.5 billion electric and gas utility announced in late 2025 a $28.8 billion capital plan for the 2026-2030 period, focused on investments in transmission and distribution. This new five-year plan also supports robust interest rate base growth of 7%, from $41.9 billion in 2025 to $57.9 billion by the end of 2030.
The appeal for income-oriented investors is the growing payout. The regulated growth strategy includes a dividend growth forecast of 4% to 6% through 2030. David Hutchens, president and CEO of Fortis, said: “We remain focused on low-risk, regulated utility growth, and our recent decisions to sell assets further support our financing plan and strengthen the balance sheet.”
Fortis assures that the five-year capital plan entails little risk and is very feasible. Only 21% is related to major capital projects and will be financed mainly with cash from operations plus regulated debt.
The diversified regulated utilities with long-term contracts provide recurring cash flows and dividends. That is why Fortis has maintained strong liquidity and higher shareholder value for years, despite significant capital requirements.
Reversal game
B.C (TSX:BCE), Canada’s most dominant telecom company, has improved its risk profile after a 56% dividend cut in May 2025. The decision ensures sustainable payouts going forward. BCE trades at $33.59 per share and pays a 5.2% dividend. The payout ratio has fallen to 43.1%, indicating that there is plenty of room for dividend growth.
The $31.3 billion communications company was under pressure from intense price competition as well as macroeconomic and geopolitical instability. BCE CEO Mirko Bibic said reinstating the dividend was the most responsible way to approach BCE’s capital allocation strategy. “Essentially, the new dividend level allows us to deleverage and invest in growth,” he added.
In the third quarter of 2025, operating revenues and free cash flow increased 1.3% and 20.6% year-over-year to $6 billion and $1 billion. Notably, net profit was $4.5 billion, compared to a net loss of $1.2 billion in the third quarter of 2024. Bibic is confident that the three-year strategic plan, together with a disciplined capital allocation strategy, will drive growth in a reformed operating environment.
Generating income
Canadian stocks could miss double-digit triple-digit growth in 2026. Nevertheless, investors can more safely focus on generating income by taking positions in dividend giants like Fortis and BCE.
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