Best Dividend Income Stocks: Strong Retirement Income

There comes a point during our quest towards retirement, or financial freedom, that we must focus on an income stream to pay for the bills.

That’s where dividend income stocks come into play. It’s the point in time where your retirement portfolio is now generating your income and paying the bills.

Why Dividend Income Stocks?

Investing for income iss a different strategy from growing a portfolio during the accumulation years with the best dividend stocks where you can take on some more risks. 

As such, finding the appropriate stock that gives you the best income with the best dividend stability is no small task. The stocks you want are:

  • Safe and stable business models
  • Provides 4% dividend yield
  • Has a history of consistent dividend payments
  • Has some dividend growth to keep up with inflation

The stable industries are the telecom stocks, the utility stocks, the bank stocks and the insurance stocks. They have the tollbooth business concepts which implies recurring revenue.

Best Dividend Income Stocks

The Dividend Snapshot Screener is setup to quickly narrow down on a short list. Filter by the income fit, the yield, the Chowder score and any other metrics you want.

Each of the holdings below will pay you more than 4% and grow their dividends at a faster rate than the inflation so you can keep up with inflation.

As a note, REITs are excluded from the filter. I am not a fan and there are safer options to generate income and have dividend growth keeping up with inflation.

The 3 filters I use from the best Canadian stock screener are:

  • Dividend Yield over 4% – Good income and not at risk
  • Chowder Score over 10% – Dividend growth beating inflation
  • Minimum of 5 Annual Consecutive Dividend Increases – Consistency by management

1. Enbridge

ENB - Enbridge Enbridge Inc. is the largest energy infrastructure company in North America. It is Canada’s largest natural gas distributor engaging in the collection, transportation, processing and storage of oil and gas. Enbridge caters to 3.7 million customers in Ontario, Quebec, New Brunswick, and New York.

It owns an extensive network of about 192,000 miles of natural gas and NGL pipelines across North America and the Gulf of Mexico. Its crude oil and liquids transportation systems are huge comprising of more than 17,000 miles of active pipelines.

The company is known for its high quality liquids and natural gas infrastructure assets. In addition, Enbridge has 3.1 Bcf/d of processing capacity and 438 Bcf of net natural gas storage capacity. It also owns interests in nearly 3,000 MW of renewable generation capacity.

Key Investment Data

  • Ticker: TSE:ENB
  • Sector: Energy
  • Industry: Oil & Gas Midstream
  • Market Cap: 105.92B
  • Market Cap Group: Large Cap
  • P/E: 18.07
  • Dividend Yield: 6.70%

2. TC Energy

TRP - TransCanada Pipeline TC Energy is a leading North American infrastructure company. It supplies more than 25% of natural gas consumed daily across North America. The company has a strong portfolio of diversified assets, storage facilities and power generation plants and operates one of North America’s largest natural gas pipelines networks extending to more than 57,500 miles.

TC Energy operates three complementary energy infrastructure businesses across three major geographies in North America. By generation type, TC’s assets can be divided into nuclear, natural gas and wind. The USA, Canada and Mexico are its core geographies and the company has access to North America’s two most prolific natural gas supply basins.

With more than 65 years of service, TC Energy is known for delivering energy in a safe and sustainable manner. Ownership of low-risk regulated cost-of-service businesses and long-term contracted energy infrastructure assets differentiate TC Energy from its peers.

Key Investment Data

  • Ticker: TSE:TRP
  • Sector: Energy
  • Industry: Oil & Gas Midstream
  • Market Cap: 62.59B
  • Market Cap Group: Large Cap
  • P/E: 33.08
  • Dividend Yield: 5.52%

3. Manulife

MFC - Manulife Manulife Financial Corporation is a leading international financial services company in Canada. The company provides financial advice, insurance, as well as wealth and asset management solutions for individuals, groups, and institutions.

Manulife offers unique product offerings for different markets it serves. The company provides a suite of financial protection and wealth management solutions to meet the current and future needs of individual and group customers. The company also owns reputed brands like Manulife and John Hancock in the USA.

Manulife serves 26 million customers in the USA, Canada, and Asia. With more than 125 years of experience, the company has developed strong customer relations and a deep understanding of their financial needs. Clients look to Manulife for reliable and intelligent financial solutions.

Key Investment Data

  • Ticker: TSE:MFC
  • Sector: Financial Services
  • Industry: Insurance - Life
  • Market Cap: 49.75B
  • Market Cap Group: Large Cap
  • P/E: 7.43
  • Dividend Yield: 5.22%

4. Algonquin Power & Utilities Corp

AQN - Algoquin Power & Utilities Corp Algonquin Power & Utilities is a diversified utility company in North America with $10 billion in total assets. The company engages in the generation, transmission, and distribution of water, gas, and electricity to communities across the U.S. 

As a growing renewable energy company, Algonquin Power owns a strong portfolio of long term contracted wind, solar and hydroelectric assets with 1.5 GW of total installed capacity.

The company has more than 50 power generation facilities and 20 utilities across North America. Algonquin’s utility business serves nearly 770,000 customers in twelve states across the U.S., through 1,200 miles of electrical transmission lines and 100 miles of natural gas transmission pipelines.

Key Investment Data

  • Ticker: TSE:AQN
  • Sector: Utilities
  • Industry: Utilities - Renewable
  • Market Cap: 11.93B
  • Market Cap Group: Large Cap
  • P/E: 14.46
  • Dividend Yield: 4.87%

5. Canadian Natural Resources

CNQ - Canadian Natural Resources Canadian Natural Resources is a diversified and independent energy producer in the world. It is the largest independent natural gas and heavy crude oil producer in Canada.  It operates a balanced mix of natural gas, light crude oil, heavy crude oil, and oil sands. The company holds some of the best oil sand assets in North America, particularly thermal in situ properties, having tremendous growth potential.

The company’s business can be broadly classified into Exploration and Production (North America, North Sea, offshore Africa), Oil Sands Mining and Upgrading, and Midstream and Refining segments. The Exploration and Production segment is Canadian Natural’s core business, while the other two businesses provide a nice diversification.

Canadian Natural has a balanced mix of natural gas, light crude oil, heavy crude oil, bitumen, and SCO. The company also owns midstream assets consisting of two crude oil pipeline systems and cogeneration plants, which enables the transportation of heavy crude oil in international markets.

Key Investment Data

  • Ticker: TSE:cnq
  • Sector: Energy
  • Industry: Oil & Gas E&P
  • Market Cap: 77.73B
  • Market Cap Group: Large Cap
  • P/E: 12.90
  • Dividend Yield: 3.68%

Build Your OWN Top List

My portfolio is generating over 12% annual returns since 2009. It's not from the beginning of the year or from 2019, it's from 2009 !!! That's a consistent return which means using the rule of 72, I double my portfolio every 6 years.

My approach is simple but you need key data that I have cultivated with the Dividend Snapshot Screeners. No other investment services provide you with easy to understand data but also actionable data. No hidden magic.

In fact, I have tried all of the investment services for dividend investors like a crash test dummy of investment services. Just ask me, and you'll learn why there was nothing I could use out there and build the Dividend Snapshot Screeners.

DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.

DISCLAIMER: Please note that this blog post represents my opinion and not an advice/recommendation. I am not a financial adviser, I am not qualified to give financial advice. Before you buy any stocks/funds consult with a qualified financial planner. Make your investment decisions at your own risk – see my full disclaimer for more details.