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10 Years From Now I Think You’ll Be Glad You Bought These Dividend Stocks

Alex Smith

Alex Smith

2 weeks ago

5 min read 👁 4 views
10 Years From Now I Think You’ll Be Glad You Bought These Dividend Stocks

In a decade’s time, a lot can change. However, for investors who are looking for world-class dividend stocks that have historically provided excellent returns, the great news is that there are plenty of fantastic options to choose from.

I’m going to highlight three of my top picks right now among various blue-chip TSX-traded dividend stocks I think can outperform in a variety of market environments. These are companies I think should be able to weather any meaningful drawdowns over the next decade, and end up providing above-market total returns over that period.

So, without further ado, let’s dive in!

Restaurant Brands

As far as top defensive dividend stocks are concerned, Restaurant Brands (TSX:QSR) has to be a top pick for investors looking to earn reasonable sleep-at-night returns over the next decade.

As the leading fast food giant on the TSX, Restaurant Brands’ portfolio of banner companies (including Tim Horton’s and Burger King) continues to provide steady dividend income (with a current yield of around 3.7%) as well as strong underlying performance from its core businesses.

As more trade-down continues to permeate the restaurant sector, I expect Restaurant Brands to continue to take market share from industry leaders. And with one of the best balance sheets in the space, if valuations get too depressed, I wouldn’t be surprised to see more acquisitions come down the line.

With these catalysts in mind, QSR stock remains a top pick of mine for those seeking reasonable total returns over the next decade.

Bank of Nova Scotia

One of the top Canadian banks with the best dividend yield of the group (in my opinion), Bank of Nova Scotia (TSX:BNS) stands out as a top option for investors seeking dividend yields above 4%.

With a dividend yield right around 4.3%, I think that’s reasonably impressive, given the stock move seen above. Scotiabank, and most other top-tier Canadian bank stocks have been on an absolute tear of late, driven higher by rising net interest margins as the yield curve continues to steepen in Canada and abroad.

With these strong underlying growth catalysts supporting the company’s lending model, and a still-strong consumer in Canada and the U.S., this is a leading bank stock investors are rightly gravitating toward right now. For long-term investors looking to benefit from Canada’s robust regulatory environment around banks, Scotiabank remains a top pick of mine from a dividend angle right now.

Dream Industrial REIT

The last pick on this list is certainly not one to be overlooked. Dream Industrial REIT (TSX:DIR.UN) is one of my top picks right now for investors looking to create passive income streams via real estate, with plenty of capital appreciation upside.

Dream Industrial has one of the best portfolios in the market of industrial real estate. That’s the warehouses and distribution centers companies need to offer the same-day delivery we’ve all come to love.

In other words, Dream Industrial powers the backbone of e-commerce, with long-duration leases in key markets throughout Canada that provide steady cash flow the company continues to pay to investors. It’s a REIT, so it has to pay out around 90% or more of its net income each and every month.

For investors looking to capture an impressive 5.4% dividend yield and do so while sleeping well at night, this is one of my top picks in the space right now.

The post 10 Years From Now I Think You’ll Be Glad You Bought These Dividend Stocks appeared first on The Motley Fool Canada.

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Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Bank Of Nova Scotia, Dream Industrial Real Estate Investment Trust, and Restaurant Brands International. The Motley Fool has a disclosure policy.

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