Investors seeking stable income may consider Canadian dividend-paying stocks as a reliable option. The Toronto Stock Exchange (TSX) offers a variety of companies with appealing dividend yields and strong fundamentals to sustain their payouts over the long term.
In this article, we will discuss three undervalued Canadian stocks that currently offer a minimum yield of 6%. These companies operate in various sectors of the Canadian economy, providing a hedge against market volatility. With the anticipation of declining interest rates, now could be an opportune time to secure these attractive high yields.
SmartCentres Real Estate Investment Trust is a prominent choice for investors seeking regular income due to its high payout ratio as a Real Estate Investment Trust (REIT). The stock offers a generous yield of 7.7%, with consistent and affordable dividends. SmartCentres REIT boasts high-traffic centers that attract substantial leasing interest, resulting in a high occupancy rate. The firm’s solid momentum in leasing demand, lease deals, and continued growth in same property net operating income make it an appealing choice for income-focused investors seeking stability and reliable yields.
Telus, a leading Canadian telecom company, presents strong potential for growth despite short-term competitive and macroeconomic challenges. The company has a track record of dividend increases and plans to raise its dividend by 7-10% annually in the future. Telus focuses on increasing its customer base, reducing costs, and investing in network infrastructure and technology for sustained growth. The company’s dividend payout ratio of 60-75% of free cash flow indicates a sustainable dividend yield of over 7%.
Bank of Nova Scotia, commonly known as Scotiabank, is a reliable income stock trading at an attractive valuation compared to its peers. With a price-to-book multiple below historical and peer averages, as well as a price-to-earnings multiple below competitors, BNS stock offers a noteworthy yield of 6.7%. The bank has a long history of dividend payments and consistent growth in dividend payouts. Scotiabank’s diversified revenue streams, exposure to high-growth markets, and efficiency initiatives contribute to its stability and reliability in dividend payments. Additionally, its solid balance sheet and capital ratios provide further support for its payouts.
