Invest $10,000 in this dividend stock for $333 in passive income

Do you have $10,000 to invest? Many investors may worry that this isn’t enough to generate generous income. However, $10,000 can create strong passive income through the power of compounding. This turns small, consistent returns into meaningful growth over time. When that money is invested in reliable dividend stocks or exchange-traded funds (ETF), you won’t just make your original $10,000. You earn on every dollar of income that is reinvested. Over the years, those small monthly or quarterly payouts have grown into larger and larger amounts, especially within a tax-free savings account (TFSA) where every cent grows tax-free. And if there’s one I’d pick, it’s this dividend stock.

CIBC

Canadian Imperial Bank of Commerce (TSX:CM) is one of Canada’s Big Six banks and has been part of the country’s financial backbone for more than a century. It offers a full range of financial services including retail banking, commercial lending, asset management and capital markets operations.

CIBC is known for its strong presence in personal banking, especially mortgages. The dividend stock has an established footprint in Canada and select international markets. As a regulated bank, backed by a stable financial system, CM offers investors a mix of income, long-term stability and steady performance across economic cycles.

Moreover, the bank has gradually expanded its digital capabilities and diversified its lending profile to strengthen profits. Although CIBC is often seen as the mortgage lender of the Big Six, the company has shifted to more balanced operations. For example, it has expanded into commercial lending and improved its fee-based segments to reduce sensitivity to interest rate movements. The disciplined focus on risk management and customer retention has kept the company competitive in a highly concentrated industry with strong barriers to entry.

In income

In its latest earnings results, CIBC posted solid results, showing revenue growth thanks to stronger net interest income and better credit performance. The dividend stock reported higher profitability in several divisions. This was noticeable in the private and corporate banking sector, where customer activity remained stable despite a cautious economic environment.

Lower loan loss provisions indicated improved credit quality and greater confidence in management’s prospects. These results showed that CIBC can navigate the current interest rate environment well and is positioning itself for continued strong earnings as loan demand normalizes.

CIBC’s strong capital position was also notable: the CET1 ratio remained well above legal requirements. This financial strength supports the generous dividend and gives the dividend stock room to continue rewarding shareholders. The company’s ability to generate reliable cash flows from diversified operations helps stabilize profits during periods of market volatility. That’s essential for dividend-oriented investors.

Silly takeaway

In short, CIBC is an ideal dividend stock for creating passive income. It offers one of the highest returns among the Big Six banks, while maintaining a long history of stable, sustainable payouts. The dividend comes from consistent, regulated banking activity – the kind of reliable cash flow that can support income growth year after year. For TFSA investors in particular, CIBC’s high-yield connections are tax-free, turning regular quarterly payments into powerful long-term wealth. Here’s what that $10,000 can get you right now.

COMPANY	RECENT PRICE	NUMBER OF SHARES	DIVIDEND	TOTAL ANNUAL PAYOUT	FREQUENCY	TOTAL INVESTMENT
CM	$126.82	78	$4.28	$333.84	Quarterly	$9,889.96

Couple this dividend stock with its improving earnings profile, strong capital base and leadership in Canadian retail banking, and CM becomes a simple, low-maintenance dividend stock. One that can anchor a passive income portfolio. It offers exactly what long-term investors want: stability today, steady growth tomorrow, and a proven commitment to rewarding shareholders regardless of market noise.