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TFSA Income Investors: Get 5-7.5% Yields From 3 Canadian Dividend Kings

Andrew Walker

Retirees and other income investors are looking for reliable high-yield dividend stocks to add to their portfolios.

One popular strategy involves holding the shares in a Tax-Free Savings Account (TFSA). The TFSA protects all distributions from the taxman, and any capital gains that occur when the stocks are sold are also tax-free.

Let?s take a look at three companies that might be of interest today.

BCE Inc. (TSX:BCE)(NYSE:BCE)

BCE isn?t widely known as a growth machine, but recent activity by the company should boost revenue and cash flow in 2018 and beyond.

What?s the scoop?

Last year, BCE bought Manitoba Telecom Services in a deal that bumped the giant into top spot in Manitoba and set the company up with a nice base in central Canada.

In the fall, BCE announced its acquisition of home-security provider AlarmForce. The deal closed in early January, and BCE could see strong uptake on the security products and services as they are introduced to the existing client base.

Finally, BCE recently launched Lucky Mobile in a move to get back into the low-cost prepaid mobile business segment.

The company generates ample free cash flow to support the dividend, and regular payout increases should continue. At the time of writing, investors can pick up a 5% yield.

Inter Pipeline Ltd. (TSX:IPL)

IPL owns natural gas liquids (NGL) extraction assets, conventional oil pipelines, oil sands pipelines, and a liquids storage business in Europe.

Management took advantage of the oil downturn to add strategic assets at attractive prices, and investors could see strong returns on the investments as the market recovers.

In addition, IPL recently gave its $3.5 billion Heartland Petrochemical project the green light. The facilities should be completed by the end of 2020.

IPL has raised the dividend through the oil downturn, and more gains should be on the way as the energy sector improves, and the new assets generate additional cash flow.

The company pays a monthly dividend of $0.14 per share for an annualized yield of 6.5%.

Altagas Ltd. (TSX:ALA)

Altagas owns gas, power, and utility businesses in Canada and the United States.

The company has grown over the years through a combination of organic developments and strategic acquisitions, and that trend continues.

On the development front, Altagas just completed two projects in British Columbia and is making good progress on its Ridley Island propane-export terminal in the province.

Regarding acquisitions, the company is working through its $8.4 billion purchase of Washington, D.C.-based WGL Holdings.

Once the WGL deal closes, Altagas plans to boost the dividend by 8% per year through 2019. The existing assets are performing well, and investors received a 4% dividend increase in late 2017.

The monthly dividend of $0.1825 per share provides an annualized yield of 7.5%.

The bottom line

Income investors can find high-yield stocks with growing dividends. An equal position in each of these stocks would provide an average yield of more than 6%.

If you are also looking for growth stocks to balance out your portfolio, the one discussed below might be worth investigating.

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Fool contributor Andrew Walker owns shares of BCE and Altagas. Altagas is a recommendation of Stock Advisor Canada.