The energy sector has emerged as the top-performing sector on the TSX as of August 15, 2024, with a year-to-date increase of 15.07%, outperforming the broad market’s 6.45%. Investors in this sector have the potential to earn through dividends and capital gains.
For those seeking reliable investments, two notable energy stocks to consider are Imperial Oil (TSX:IMO) and Keyera (TSX:KEY). These companies not only offer market-beating returns but also have a track record of growing dividends.
Imperial Oil, despite not having the highest dividend yield, has increased its dividend for 28 consecutive years. With a current share price of $99.36, investors have seen a 33.41% increase in addition to a 2.42% dividend yield. With a market capitalization of $53.24 billion, Imperial Oil is one of Canada’s largest integrated oil companies.
With a 69.6% ownership stake from American oil giant Exxon Mobil, Imperial Oil holds a significant position in the Canadian energy market. The company’s Dividend Aristocrat status makes it a popular choice among income-focused investors looking for stable returns. Despite facing challenges such as the oil slump and the COVID-19 pandemic, Imperial Oil maintained its dividend commitment by reducing costs and focusing on high-return projects.
Keyera, on the other hand, has seen a year-to-date increase of +25.59% and offers a 5.23% dividend yield at a share price of $39.12. The company recently approved a 4% dividend hike following strong cash flows and marketing results in Q2 2024. Keyera’s president and CEO, Dean Setoguchi, expects sustained dividend growth due to disciplined execution of the business strategy and strong free cash flow generation in the coming years.
Both Imperial Oil and Keyera offer sustained passive income opportunities for investors seeking reliable returns. Their potential for price appreciation further adds to their attractiveness as investment options.
