Essentially, hitting the buy button and being patient is the strategy I’m talking about with these two world-class dividend stocks. Investors looking for reliable passive income for retirement or other long-term goals have excellent options with these two companies.
So, without further ado, let’s dive in!
Telus
In the world of major Canadian telecommunications stocks Telus (TSX:T) remains one of my top picks at the moment.
A big part of this statement has to do with the company’s relatively high current dividend yield of 8.9%. Indeed, it is difficult to find a blue chip company trading with such returns at the moment. And of course, if you look at the chart above, this return is the result of what can only be called a plummeting stock price.
Now Telus has gone through similar cycles in the past. And there are headwinds in the telecom sector, with reports of overdue payments on mobile phone bills spiking recently.
That said, I have long believed that telecom companies can be seen as the utilities of the future. It’s one of the last bills investors want to default on, considering so many of us live our lives primarily on our phones.
With financials still robust and a balance sheet supporting current returns, I’m not as concerned about a potential dividend cut as others. In fact, I think this is a good time to be a contrarian and buy Telus during this dip.
Restaurant brands
Another top dividend stock that I keep coming back to, not only for its current yield and dividend growth potential, but also for its defensive business model, is Restaurant brands (TSX:QSR).
The shares of Tim Hortons, Burger King and Popeyes (among other banners) have had a bumpy ride over the past five years. That said, it’s been a journey that has especially elevated long-term investors.
One notable aspect of owning QSR stock that I don’t think gets enough attention is the company’s dividend yield of 3.5%. This is a company committed to returning capital to shareholders and has done its fair share of providing more robust share buybacks and dividend payouts over time. Given the defensive nature of Restaurant Brands’ business model, I expect this theme to continue for years and decades to come.
Of course, the current dynamics in the fast food sector are tenuous. Investors are unsure whether the rise of GLP-1 drugs and diet trends will derail long-term profits. However, the decline among those dining away has clearly benefited the company’s core banners.
I currently fall more into the latter group, which believes that the balance of risks has tilted in a positive direction for long-term investors.
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