Top 3 TSX Dividend Stocks To Consider

The market has stayed flat over the past 7 days, but it has risen 12% in the past 12 months with earnings forecast to grow by 15% annually. In this environment, dividend stocks can offer a reliable income stream and potential for capital appreciation, making them an attractive option for investors.

Top 10 Dividend Stocks In Canada

Name	Dividend Yield	Dividend Rating
Bank of Nova Scotia (TSX:BNS)	6.64%	★★★★★★
Whitecap Resources (TSX:WCP)	7.08%	★★★★★★
Secure Energy Services (TSX:SES)	3.29%	★★★★★☆
Boston Pizza Royalties Income Fund (TSX:BPF.UN)	8.19%	★★★★★☆
Power Corporation of Canada (TSX:POW)	5.69%	★★★★★☆
Enghouse Systems (TSX:ENGH)	3.42%	★★★★★☆
Royal Bank of Canada (TSX:RY)	3.73%	★★★★★☆
Firm Capital Mortgage Investment (TSX:FC)	8.78%	★★★★★☆
Russel Metals (TSX:RUS)	4.27%	★★★★★☆
Canadian Natural Resources (TSX:CNQ)	4.33%	★★★★★☆

Click here to see the full list of 33 stocks from our Top TSX Dividend Stocks screener.

We'll examine a selection from our screener results.

Enghouse Systems

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Enghouse Systems Limited, with a market cap of CA$1.70 billion, develops enterprise software solutions worldwide through its subsidiaries.

Operations: Enghouse Systems Limited generates revenue from its Asset Management Group (CA$180.88 million) and Interactive Management Group (CA$299.55 million).

Dividend Yield: 3.4%

Enghouse Systems offers a stable and growing dividend, with payments reliably increasing over the past decade. The current dividend yield is 3.42%, which is modest compared to top Canadian dividend payers. However, the payout ratios are sustainable, with earnings coverage at 65.7% and cash flow coverage at 45.7%. Recent earnings showed significant growth, with Q2 revenue at C$125.81 million and net income rising to C$19.97 million from C$12.54 million year-over-year.

• Take a closer look at Enghouse Systems' potential here in our dividend report.

• Our valuation report here indicates Enghouse Systems may be undervalued.

TSX:ENGH Dividend History as at Aug 2024

High Liner Foods

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: High Liner Foods Incorporated processes and markets frozen seafood products in North America, with a market cap of CA$396.06 million.

Operations: High Liner Foods generates $1.03 billion from the manufacturing and marketing of prepared and packaged frozen seafood.

Dividend Yield: 4.5%

High Liner Foods recently refinanced its $240 million senior secured term loan, reducing interest rates and extending maturity to 2031, which is expected to save $1.4 million annually. The company also initiated a share repurchase program for up to 700,000 shares. Despite the dividend's volatility over the past decade, it remains well-covered by earnings (41.5% payout ratio) and cash flows (7.8% cash payout ratio). The current dividend yield stands at 4.53%.

• Delve into the full analysis dividend report here for a deeper understanding of High Liner Foods.

• Insights from our recent valuation report point to the potential undervaluation of High Liner Foods shares in the market.

TSX:HLF Dividend History as at Aug 2024

Parex Resources

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: Parex Resources Inc. is involved in the exploration, development, production, and marketing of oil and natural gas in Colombia, with a market cap of CA$2.10 billion.

Operations: Parex Resources Inc. generates revenue from the exploration, development, production, and marketing of oil and natural gas in Colombia.

Dividend Yield: 8.1%

Parex Resources has shown stable dividend payments, though it has only paid dividends for three years. Recent earnings reports indicate a significant drop in net income, from US$101.42 million to US$3.85 million year-over-year for Q2 2024, raising concerns about sustainability despite a low payout ratio of 18.9%. The company increased its quarterly dividend to C$0.385 per share and maintains a reasonable cash payout ratio of 64.1%, suggesting dividends are currently well-covered by cash flows and earnings.

• Dive into the specifics of Parex Resources here with our thorough dividend report.

• Upon reviewing our latest valuation report, Parex Resources' share price might be too pessimistic.

TSX:PXT Dividend History as at Aug 2024

Turning Ideas Into Actions

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Looking For Alternative Opportunities?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include TSX:ENGH TSX:HLF and TSX:PXT.

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