1 Magnificent TSX Dividend Stock Down 41% to Buy and Hold for Decades

The TSX has several magnificent stocks that have steadily increased their dividends. Their solid dividend payment history and sustainable payouts make them a compelling investment to buy and hold for decades.

However, here I’ll focus on a magnificent TSX dividend stock that has corrected significantly but still has solid fundamentals and a resilient payout. By buying this dividend stock at today’s discounted levels, investors can lock in dependable dividend income while also positioning themselves to benefit from a potential rebound in the share price as market sentiment improves.

The magnificent TSX dividend stock

Over the past year, the Canadian equity market has been on a strong run, with the S&P/TSX Composite Index climbing about 30%. However, goeasy (TSX: GSY), a well-known Canadian dividend grower, has moved sharply in the opposite direction, trading roughly 41% below its 52-week high.

Investor sentiment turned cautious on goeasy stock after a short-seller report questioned the company’s accounting practices and overall risk profile. Further, higher credit-loss provisions and higher financing costs in the third quarter of 2025 weighed on its stock price.

At the same time, goeasy’s strategic shift toward secured lending has put pressure on its overall portfolio yield, weighing on near-term earnings. This further irked investors.

Despite these near-term challenges, goeasy’s underlying business remains resilient. goeasy continues to generate steady cash flows, providing solid coverage for its dividend payouts.

For long-term investors focused on income and willing to look beyond short-term volatility, the recent decline in goeasy’s share price represents an attractive entry point.

goeasy’s compelling dividend growth history

goeasy is a dependable income stock, backed by over two decades of uninterrupted dividend payments. That long history shows the company’s ability to navigate different economic cycles while consistently returning cash to shareholders.

Notably, in 2020, goeasy joined the S&P/TSX Canadian Dividend Aristocrats Index after growing its dividend by about 42% annually over the prior five years. The momentum has continued. In February 2025, the company raised its quarterly dividend by 24.8% to $1.46 per share, marking the 11th straight year of dividend increases.

Since 2021, goeasy’s annual dividend has surged 121%, reaching $5.84 per share. At current prices, the stock yields about 4.6%, offering investors both income and growth potential.

Why buy goeasy stock right now and hold for decades?

goeasy appears well-positioned to continue growing its dividend and deliver solid capital gains despite short-term pressure on yields. Its leading position in Canada’s large subprime lending market will likely drive higher originations, expand its consumer loan portfolio, and boost its top line. At the same time, goeasy’s diversified funding channels and omnichannel platform augur well for growth.

The company’s management expects gross consumer loan receivables to range from $7.35 billion to $7.75 billion by 2027, while operating margins are also projected to improve. As the loan book expands and margins strengthen, its cash flows could strengthen, comfortably supporting current dividend payments and leaving room for future increases.

At the same time, the company continues to invest in improving operating efficiency and is focusing on secured loans, which will reduce risk and drive its earnings.

From a valuation perspective, goeasy’s shares trade at a forward price-to-earnings (P/E) multiple of about 6.7, which is compelling relative to its earnings growth potential. Given the company’s track record of double-digit earnings growth, its ability to generate above-average returns, and its commitment to rewarding shareholders through rising dividends and an attractive yield, goeasy is an attractive stock to buy now and hold.

The post 1 Magnificent TSX Dividend Stock Down 41% to Buy and Hold for Decades appeared first on The Motley Fool Canada.

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Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.