Telus Stock vs. Fortis: Which Dividend Giant Wins in 2026?

For dividend fans out there, the current slate of income stocks is becoming quite interesting, especially as market volatility looks to turn things up a few notches. Undoubtedly, the combination of lower interest rates and rising dividend stocks (especially in the financial sector) has made yields a bit less bountiful in the past 18 months. Still, if you’re willing to look at industries that are under pressure, there are still those fat yields to be had.

Telus is a 9% yield heavyweight, but there are risks

Undoubtedly, shares of Telus (TSX:T) have been garnering considerable interest among passive income investors. It’s tough to ignore the elephant in the room that is Telus stock’s massive 9% yield. It might be a hefty commitment, but it does not seem to be at risk of an imminent cut, at least for now.

If things don’t turn around in 2026, perhaps the dividend could find itself skating on thin ice. But with dividend cut risk already priced in and no further growth in the payout, perhaps Telus stock is one of the few generational opportunities to lock in a sky-high yield alongside some recovery gains in the next three to five years.

Of course, bottom-fishing for deep value requires patience and a willingness to take some pain over the near term. While it’s too early to tell if Telus can keep its dividend going strong as headwinds prevail, I do think that balancing risks in a high-yield name with a lower-beta, dividend grower could make a lot of sense, especially in this climate.

Fortis stock is a lower-risk dividend growth star

While I do think Telus is a good stock to own, provided you can bear the risks (think of the downside scenario that sees Telus reduce its payout), I think balancing it with the likes of a safer dividend stock like Fortis (TSX:FTS) could be a smart move. Undoubtedly, Fortis stock stands out as more of a bond proxy than anything else, given the regulated nature of its electricity transmission assets.

As the firm continues to grow south of the border while also benefiting from the AI boom’s rising appetite for energy (the grid will surely be busy), I like the growth profile for Fortis. Of course, Fortis may not be a direct AI beneficiary, but it is in the background, ready to generate real cash flows as the boom works its way through the energy scene. Transmission and distribution of electricity may not be as growthy as energy production itself, but it’s an often overlooked, lower-risk way to profit from behind the scenes.

Either way, I think Fortis stock is a stellar dividend grower, especially as it moves ahead with its multi-year growth plans. The stock trades at 21.5 times trailing price-to-earnings (P/E), which is fair, and the 3.5% dividend yield, though historically small, is still quite bountiful when you consider the mix of low-risk growth potential you’ll get.

So, does FTS stock outshine Telus in the new year?

Personally, I think it’s a race that’s too close to call. Given the current set-up and the reasonable valuations, I think both companies can thrive in 2026. In my view, there’s no reason why both dividend payers can’t win big. So, if you’re looking to balance upside with lower risk (and volatility), I think Telus and Fortis are great buys together as a pair trade of sorts.

The post Telus Stock vs. Fortis: Which Dividend Giant Wins in 2026? 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

• It’s a Whopping 8.8%, but Is Telus’s Dividend Safe?
• 5 Dividend Stocks to Double Up on Right Now
• Dividend All-Stars: Canadian Stocks That Keep Paying Year After Year
• Canadian Dividend Giants: Fortis and BCE Are Key Buys for 2026
• Safe Canadian Stocks to Buy Now and Hold During Market Volatility

Fool contributor Joey Frenette has positions in Fortis. The Motley Fool recommends Fortis and TELUS. The Motley Fool has a disclosure policy.