In this article, we will be taking a look at 10 Canadian dividend stocks to buy. To skip our detailed analysis of dividend investing, you can go directly to see the 5 Canadian Dividend Stocks to Buy.
Why Canadian Dividend Stocks?
When it comes to Canadian dividend stocks, we have seen immensely encouraging dividend increases very recently.
It’s expected that the big six Canadian Banks — Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia (Scotiabank), Bank of Montreal, Canadian Imperial Bank of Commerce, and National Bank of Canada — will resume boosting their dividends in the coming year, according to a Reuters report.
These banks on average have a dividend yield of 3.3%, compared to the sector median of 2.5%. The increases could range from 10% for Scotiabank to the 34% high for National Bank, according to National Bank Financial analyst Gabriel Dechaine. As such, the popularity of these stocks is expected to exponentially increase.
While stocks like Medtronic plc (NYSE:MDT), Verizon Communications (NYSE:VZ), Morgan Stanley (NYSE:MS), and McDonald’s Corporation (NYSE:MCD), are certainly among some of the top picks for dividend investors, Canadian bank stocks are also making their way slowly up that list.
Photo by lucas Favre on Unsplash
Let’s now take a look at the 10 Canadian dividend stocks to buy.
Canadian Dividend Stocks to Buy
10. Bank of Montreal (NYSE:BMO)
Number of Hedge Fund Holders: 12
Dividend Yield: 3.5%
Number of Years of Dividend Growth: 6
Bank of Montreal (NYSE:BMO), a diversified financial services company operating in North America, is among our top picks for Canadian dividend stocks to buy. It offers personal banking products and services including checking and savings accounts, alongside commercial banking products like business deposit accounts. The company has steadily been growing its dividend for the past six years as well.
Doug Young, an analyst at Desjardins, reiterated a Buy rating on Bank of Montreal (NYSE:BMO) shares this December.
In the fiscal fourth quarter of 2021, Bank of Montreal (NYSE:BMO) had an EPS of $2.59, beating estimates by $0.08. The company’s revenue was $5.12 billion.
By the end of the third quarter of 2021, 12 hedge funds out of the 867 tracked by Insider Monkey held stakes in Bank of Montreal (NYSE:BMO) worth roughly $142 million. This is compared to 12 hedge funds in the previous quarter as well, with a total stake value of approximately $133 million.
Like Medtronic plc (NYSE:MDT), Verizon Communications (NYSE:VZ), Morgan Stanley (NYSE:MS), and McDonald’s Corporation (NYSE:MCD), Bank of Montreal (NYSE:BMO) is a dividend stock among many hedge funds’ top picks.
9. Canadian Imperial Bank of Commerce (NYSE:CM)
Number of Hedge Fund Holders: 13
Dividend Yield: 3.8%
Number of Years of Dividend Growth: 6
Canadian Imperial Bank of Commerce (NYSE:CM) is another diversified financial institution. It offers its products and services to personal, business, public sector, and institutional clients in the US and Canada, and internationally. Some of its products include chequing, savings, and business accounts, and having raised its dividend yield for six years in a row, it is among the most popular Canadian dividend stocks to buy.
Canaccord’s Scott Chan just this December reiterated a Buy rating on shares of Canadian Imperial Bank of Commerce (NYSE:CM).
At the close of the third quarter of 2021, D. E. Shaw was the largest shareholder for Canadian Imperial Bank of Commerce (NYSE:CM), holding 709,693 shares worth $78.9 million. Apart from D. E. Shaw, 12 other hedge funds held stakes in the company, and the total stake value for all 13 hedge funds was approximately $289 million.
8. The Bank of Nova Scotia (NYSE:BNS)
Number of Hedge Fund Holders: 17
Dividend Yield: 4.27%
Number of Years of Dividend Growth: 5
The Bank of Nova Scotia (NYSE:BNS) is a Canadian bank offering financial products and services through its Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets segments. It provides debit and credit cars, chequing and savings accounts, and mortgages and loans, among other products.
The stock has multiple positive ratings placed on it by analysts, among which we have a Buy rating from Canaccord analyst Scott Chan. He reiterated this rating just this December.
According to Insider Monkey’s third quarter hedge fund data, 17 funds held stakes in The Bank of Nova Scotia (NYSE:BNS) in that quarter worth about $193 million. Comparatively, in the second quarter, 14 hedge funds held stakes in the company worth $223 million.
7. Great-West Lifeco Inc. (TSE:GWO)
Number of Hedge Fund Holders: N/A
Dividend Yield: 4.5%
Number of Years of Dividend Growth: 6
Great-West Lifeco Inc. (TSE:GWO) is a financial services holding company operating in the life and health insurance industry. It offers benefit plan solutions, life disability, critical illness, accidental death, dismemberment, health, and dental protection, and creditor insurance products, among a range of others. The company has consistently grown its dividend for the past six years.
In November, National Bank’s Gabriel Dechaine reiterated a Sector Perform rating on Great-West Lifeco Inc. (TSE:GWO) shares.
The company’s EPS in the third quarter was $0.73, while its revenue was approximately $13.14 billion.
Like Medtronic plc (NYSE:MDT), Verizon Communications (NYSE:VZ), Morgan Stanley (NYSE:MS), and McDonald’s Corporation (NYSE:MCD), Great-West Lifeco Inc. (TSE:GWO) is a dividend stock investors are piling into today.
6. BCE Inc. (NYSE:BCE)
Number of Hedge Fund Holders: 15
Dividend Yield: 5.1%
Number of Years of Dividend Growth: 3
BCE Inc. (NYSE:BCE) is a Canadian communication services company that offers wireless, wireline, internet, and television services. It operates through its Bell Wireless, Bell Wireline, and Bell Media segments.
Jerome Dubreuil, an analyst at Desjardins, this November kept a Hold rating on BCE Inc. (NYSE:BCE) shares.
Out of 867 elite hedge funds, our data shows 15 such funds long BCE Inc. (NYSE:BCE) in the third quarter of 2021. Of these hedge funds, the largest shareholder for the company was Two Sigma Advisors.
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Disclosure: None. 10 Canadian Dividend Stocks to Buy is originally published on Insider Monkey.
