Canadian investors may not enjoy the same amount of options when it comes to picking great dividend stock as their neighbor, the United States. But Canada still has some amazing dividend stocks in both Toronto Stock Exchange (TSX) and the Canadian Securities Exchange (CSE). In this article, we bring you 3 of the best Canadian dividend stocks you can buy now and hold for life.

Investing in the stock market can be a daunting task, especially if you are a growth investor. This means that the investor expects the stock prices to appreciate along with the growth of its company over the long run. But how does one predict the future? Through a lot of research. And how does one know when to cash in? Through keeping in close touch with the stock market. This can be very time-consuming. One workaround is to invest in dividend stocks.

But… dividends aren’t a guarantee either. A company can have a couple of bad years and they need all the extra profits and cash for rebuilding. Paying dividends will be out of the menu.

One workaround for this is to go for the safest dividend stocks. These can be either dividend aristocrats or just generally strong blue-chip companies. We call them ‘for life’ stocks.

‘For Life’ Stocks

When we came up with these 3 dividend stocks that you could buy now and hold for life, we went through several criteria.

• Business model: a sound, self-sustaining model, with quality products,
• History: years of operations = business experience = adoption of best practices, standards, networks, and size of safety net,
• Future: the most important element, and the hardest to predict,
• Market presence: the larger the piece of the pie they own, the harder to knock them out,
• Misc. highlights: anything else that could be game-changing.

3 Best Canadian Dividend Stocks to HOLD for Life

(3) BCE Inc. (BCE.TO)

Business model: communications firm providing mobile, internet, and TV services across its wireless and wireline networks.

Bell’s customer base includes individuals, businesses, and even government organizations.

Further, BCE has diversified into parallel market segments such as TV networks, specialty channels, radio stations, and sports franchises. BCE also owns retail locations and advertising businesses.

History: been in operations since 1880 & continuous dividends since 1983

Future: communication services (including Internet) are increasingly becoming necessities for life.

Also, addressing the increasing demand for ‘cleaner’ operations, BCE has an aggressive target to be carbon neutral by 2025.

Further, Bell has started investing heavily in increasing their 5G network, which can be considered the future of network speeds for the foreseeable future.

Market presence: Canada’s largest communications provider

Key points:

• Continuous dividends paid since 1983
• Targets 65%-75% payout, which can be considered healthy
• Q1 2021 results are up from Q1 2020 (1.2% increase in revenue)
• Dividend increased from $3.33 to $3.50, in Feb 2021
• Dividend yield of 5.77%

(2) Fortis Inc. (FTS.TO)

Business model: an electric and gas utility company in Canada, the United States, and the Caribbean countries.

They generate, store, and deliver energy to around 3.4 million customers.

FTS’s business segmentation is very one-sided. It is engaged in 93% energy delivery, and 7% energy generation. But, we are okay with this. Energy delivery or transportation will remain intact even though the sources of generation will be challenged to be greener in the future.

History: been in operations since 1885 & continuous dividends since 1972

Future: we wouldn’t really recommend a typical ‘energy’ company for the future, but FTS has an impressive goal of 80% carbon-emission reduction by 2035.

Company already has several projects on solar, wind, and hydro power generation.

Market presence: one of the biggest utility companies in North America, market cap of $26 billion.

Key points:

• Continuous dividends paid since 1972
• Targets 50%-60% payout, which can be considered healthy
• Q1 2021 results are up from Q1 2020 ($40mn net earnings)
• Dividend of $2.02/annum (increased in September 2020)
• Dividend yield of 3.6%

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(1) Royal Bank of Canada (RY.TO)

Business model: diversified financial service company with worldwide operations (over 30 countries).

Over 16 million clients worldwide, and provides financial services across personal, commercial, wealth management, treasury, and capital markets segments.

History: been in operations since 1864 & continuous dividends since 1870.

Future: one of the best banks to survive the COVID-19 pandemic and forecasts decent growth into the future. Banking will be one of the last industries to go even if the world was ending.

Market presence: the biggest of the ‘Big Five’ banks in Canada (by revenue & market cap C$179 billion.

Key points:

• Continuous dividends paid since 1870
• Less than 45% payout, which can be considered healthy
• Q2 2021 results are up from Q2 2020 ($2.5bn earnings)
• Dividend of $4.32/annum
• Dividend yield of 3.44%

So, BCE Inc., Fortis Inc., and Royal Bank of Canada are out top three picks for ‘for life’ dividend stocks for July 2021. We will keep on bringing more worthy stocks in the coming months. So stay tuned.

Let us know what are your thoughts on these three picks in the comments below.

Disclaimer: I am not a licensed investment Advisor or Tax professional; therefore all content posted on this blog represents my personal views and opinions and should never be considered as professional advice.  This blog should be viewed for entertainment or educational purposes only; not a recommendation to buy/sell certain stocks.  Please do your own research before buying/selling stocks.