2 Canadian Dividend Giants Worth Considering While Interest Rates Stay Flat

Last month, the Bank of Canada held its benchmark interest rate steady at 2.25% as policymakers weighed slowing economic growth against persistent inflationary pressures stemming from higher fuel and food prices. At the same time, the central bank has left the door open for future policy adjustments depending on how economic conditions and inflation risks evolve.

At present, Canada’s interest rates are not too high nor too low. In this environment, investors may consider adding high-quality dividend-paying stocks to their portfolios to generate stable passive income and enhance portfolio resilience. Dividend-paying companies can provide a dependable income stream alongside long-term capital appreciation, making them especially attractive during periods of economic uncertainty.

However, since dividends are not guaranteed, investors should focus on companies with strong underlying businesses, resilient cash flows, and a proven track record of consistent payouts. In addition to providing regular income, dividend stocks can help investors build long-term wealth through compounding by reinvesting distributions.

Against this backdrop, let’s look at two high-quality dividend stocks that look attractive following their recent pullbacks.

Bank of Nova Scotia

First on my list is Bank of Nova Scotia (TSX:BNS), which provides a broad range of financial services across several international markets. Backed by diversified revenue streams, the bank generates healthy cash flows across varying economic environments and has maintained an uninterrupted dividend-paying record since 1833. Over the last decade, it has increased its dividend at an annualized rate of 4.7% and currently offers a forward dividend yield of 4.11%.

BNS is also sharpening its focus on expanding in the more stable and profitable North American market while reducing exposure to higher-risk, lower-margin Latin American operations. This strategic repositioning could support more stable earnings growth and improve the consistency of its cash flows over the long term. Meanwhile, the current interest rate environment could continue to support the bank’s net interest margins, benefiting its core banking operations.

In addition, management recently approved a new share-repurchase program authorizing the bank to repurchase up to 15 million shares between April 7, 2026, and April 6, 2027. These buybacks could reduce the company’s outstanding share count by roughly 1.2%, thereby enhancing shareholder value.

Despite these strengths, BNS trades at a reasonable 12.8 multiple of analysts’ projected earnings over the next four quarters. Given its improving business mix, reliable dividend profile, and attractive valuation, I believe BNS is a compelling buy while the Bank of Canada maintains its current interest rate stance.

Enbridge

Another dividend stock that looks highly attractive right now is Enbridge (TSX:ENB), supported by its reliable business model, consistent dividend growth, and attractive yield. The company has a diversified energy infrastructure portfolio spanning contracted midstream operations, regulated utility assets, and renewable energy projects secured through long-term power-purchase agreements (PPAs). Overall, nearly 98% of its earnings come from regulated assets and long-term contracts, while around 80% of its earnings before interest, taxes, depreciation, and amortization is protected through inflation-linked arrangements.

Thanks to this stable business structure, Enbridge’s financial performance and cash flows are less sensitive to economic downturns and commodity price volatility. This resilience has enabled the company to pay uninterrupted dividends for nearly 70 years. In addition, Enbridge has increased its dividend for 31 consecutive years and currently offers an attractive forward dividend yield of 5.24%.

Meanwhile, rising oil and natural gas production across North America continues to support demand for Enbridge’s infrastructure network and transportation services. To capitalize on this growing demand, the company is steadily expanding its asset base through strategic investments, which could drive earnings and cash flow growth in the years ahead.

Alongside its strong growth outlook, Enbridge maintains a solid balance sheet and healthy distributable cash flow coverage, which should support the sustainability of its future dividend increases.

The post 2 Canadian Dividend Giants Worth Considering While Interest Rates Stay Flat appeared first on The Motley Fool Canada.

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More reading

• The 3 Dividend Stocks I Think Every Investor Should Own
• The Best $10,000 TFSA Approach for Canadian Investors
• 2 Dividend Stocks to Buy Today and Feel Good Holding for at Least 5 Years
• A Canadian Dividend Stock Up 40% to Buy Forever
• Grab These Dividend Stocks Now Before Their Prices Rise and Yields Drop

Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool recommends Bank Of Nova Scotia and Enbridge. The Motley Fool has a disclosure policy.