Canada Markets closed

The Top 3 Stocks for Dividend-Hungry Investors

Karen Thomas, CFA
Upwards momentum

Here’s a thought — a thought that seems like an oxymoron, but I’ll show you that it’s not.

What if we can get high dividend yields coupled with low-risk businesses?

Oftentimes, high dividend yields are reserved for high-risk companies that look attractive but, upon further inspection, have clear problems and risks associated with them.

And if you’re a dividend-hungry investor, it can be easy to fall into this trap. I think we all have at some point. But we learn to do better next time and to put a greater focus on payout ratios, the health of the balance sheet, and cash flow strength.

Without further ado, here are three top stocks to consider for high yields and low risk.


Flirting with 52-week highs, BCE (TSX:BCE)(NYSE:BCE) has been an investor’s dream in the last 10 years.

Currently giving investors a dividend yield of 5.18%, BCE is awash in cash and a pillar of strength. Dividend-hungry investors can get this generous dividend yield, all from the safety of a strong and steady company.

In the last 10 years, BCE has increased its dividend by 117% to the current $3.17 per share. The latest increase was a 5% increase in the first quarter — a quarter in which this telecom giant continued to rake in the cash and deliver solid execution. 2018 cash flow was $3.6 billion and free cash flow as a percentage of revenue was 15%.


Telus (TSX:T)(NYSE:TU) is Canada’s second-largest telecommunications provider that provides wireline, data and wireless service, all while providing investors with stability, predictability, and generous dividend income.

With a dividend yield of 4.48%, Telus is coming off a period of clear outperformance. The stock has a 10-year return of 238%. And that’s just capital gains. Telus has a long history of semi-annual dividend increases, with a seven-year compound annual growth rate (CAGR) of 11.4%.

Telus has been one of the faster-growing telecom companies out there, and this has been evident in its stock returns.

Going forward, Telus is keeping current with its investment in the long-term growth of the company. Telus has industry-leading 5G coverage of 70% and is investing in its Telus Health Electronic Medical Record solution; both will contribute to a strong future.

Brookfield Infrastructure Partners

Heading into another industry, check out Brookfield Infrastructure (TSX:BIP.UN)(NYSE:BIP) for exposure to one of the largest portfolios of globally diversified infrastructure assets in sectors ranging from the energy sector to the utilities sector to the communications and renewables sectors.

With a generous dividend yield of 4.86%, Brookfield provides a high, safe, and reliable dividend while generating explosive capital gains for shareholders. In the last 10 years, the stock has provided a return of almost 400%.

More reading

Fool contributor Karen Thomas has no position in any of the stocks mentioned. Brookfield Infrastructure is a recommendation of Stock Advisor Canada.

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool Canada’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Motley Fool Canada 2019