A Safer Dividend Stock to Buy With $20,000 Right Now

Investors looking to invest $20,000 in a safe dividend stock could consider investing in the utility sector. While no stock is completely risk-free, utility companies are viewed as defensive because they provide essential services. Regardless of whether the economy is booming or slowing, demand for electricity, natural gas, and water tends to remain stable, giving utility companies the resilience to generate steady returns.

Another important factor to highlight is that utility stocks benefit from their regulated business model. This operating structure enables these companies to generate predictable, growing earnings, helping reduce volatility in their cash flows. This financial stability has historically supported consistent dividend payments, making Canadian utility companies a reliable source of income for long-term investors.

The sector’s outlook also remains encouraging. Growing energy demand from electrification trends, population growth, and ongoing infrastructure investment is expected to support future growth. Overall, these factors position utility companies to continue delivering dependable dividends along with the potential for long-term capital appreciation.

With that context, here is a relatively safer Canadian dividend stock to buy right now.

A top dividend stock to consider now

Fortis (TSX:FTS) is one of the most reliable stocks in Canada’s utility sector for investors seeking worry-free income for decades. Fortis focuses on power transmission and distribution and generates stable revenues. Moreover, its rate-regulated operating structure and predictable cash flows relatively shield it from economic downturns, supporting steady dividend payments and growth.

Thanks to its defensive business model and growing cash flow, Fortis has increased its dividend for over five decades. In November 2025, Fortis raised its dividend by 4.1%, extending its streak to 52 consecutive years of dividend growth. Moreover, it offers a well-covered yield of about 3.5%.

Beyond income, Fortis has also delivered solid capital gains. Over the past year, its shares have risen about 23%, driven by strong operating results, improving market sentiment, and rising electricity demand. With its resilient business model and steadily expanding cash flow, Fortis appears well-positioned to continue rewarding shareholders through 2026 and beyond.

Fortis to raise dividend by 4% to 6%

Fortis is well-positioned to extend its long track record of dividend increases, supported by a defensive business model, low-risk earnings, and a a $28.8 billion capital investment plan scheduled over the next five years.

Fortis’s capital plan focuses on regulated utility projects. By concentrating capital spending on regulated assets and avoiding execution risks associated with large, complex development projects, the company is expanding its low-risk earnings base.

As these investments are deployed, Fortis’s consolidated rate base is projected to grow significantly, from roughly $42 billion in 2025 to about $58 billion by 2030. The rising rate base will drive its earnings and enable the company to deliver annual dividend growth in the 4% to 6% range.

Fortis will also benefit from the rising electricity demand from energy-intensive industries, including manufacturing and data centres. Meanwhile, the company’s ongoing divestment of non-core assets is strengthening the balance sheet.

In summary, Fortis stock offers stability, steady dividend income, and growth, making it a relatively safer stock to buy right now.

The post A Safer Dividend Stock to Buy With $20,000 Right Now appeared first on The Motley Fool Canada.

Should you invest $1,000 in Fortis Inc. right now?

Before you buy stock in Fortis Inc., consider this:

The Motley Fool Canada team has identified what they believe are the top 10 TSX stocks for 2026… and Fortis Inc. wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $21,827.88!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 102%* – a market-crushing outperformance compared to 81%* for the S&P/TSX Composite Index. Don’t miss out on our top 10 stocks, available when you join our mailing list!

Get the 10 stocks instantly #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of January 15th, 2026

More reading

• The 3 Best Canadian Stocks to Buy With $1,000 Right Now
• Quality Over Hype: The Boring Investment Strategy That’s Winning
• Your TFSA Should Be Your Income Engine, Not Your RRSP
• TFSA: 3 Canadian Stocks to Buy and Hold Forever
• All-Weather TSX Stocks for Every Market Climate

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