This TSX Dividend Stock Could Surprise in 2026

In the world of top Canadian dividend stocks, the number and quality of options to consider is immense. As such, I think investors really need to make a short list and identify a few top-tier opportunities to consider in 2026.

Among the top picks I’ve begun to hone in on recently is Whitecap Resources (TSX:WCP), a Canadian mid-cap energy stock that’s seen impressive price performance of late.

Looking at the chart above, some investors may begin to feel dizzy and consider a reality in which this stock comes down to earth. Here’s why I don’t think that will be the case in 2026.

Sustainable dividend growth

At current levels, Whitecap’s dividend yield sits a little above 5%. That’s right in line with its long‑term average and well above the TSX overall.

Whitecap’s management team has continued to raise its dividend over time, particularly as a result of surging operating earnings in response to higher commodity prices. For those who think this recent oil price shock won’t be short-lived, WCP stock looks like a top way to play this trend.

Importantly, the company also pays a monthly dividend yield, meaning this is the sort of passive income machine most retirees are looking for. Indeed, investors who want a high-powered cash flow-producing machine that returns that capital to investors on a monthly basis have few better options on the TSX today, in my view.

What really matters, though, is coverage. In 2025, Whitecap generated about $2.9 billion in funds flow and roughly $900 million in free funds flow after capital spending. That kind of firepower puts the company’s current payout on very solid footing and leaves ample room for debt reduction, buybacks, or future dividend hikes if commodity prices cooperate.

Solid guidance for a big 2026

The story for 2026 starts with what Whitecap just did in 2025. The company delivered record annual production of roughly 307,000 barrels of oil equivalent per day. That number is up 76% from the prior year, which is impressive considering Whitecap has kept capital spending in line with expectations. Critically, production not only grew, but it also exceeded guidance. That performance was driven by strong base performance and better‑than‑expected new wells. Indeed, this is the kind of consistent outperformance that tends not to be fully priced in by the market until it has been proven over several quarters.

On the financial side, Whitecap’s net income approached $1 billion in 2025, with margins supported by realized efficiencies from its Veren business combination and ongoing cost‑reduction efforts. Revenues have been compounding at a near‑20% annual rate over the past several years, and earnings growth in the most recent year has meaningfully outpaced the broader oil and gas industry. If those trends persist into 2026, investors could see both higher cash returns and multiple expansion

Now’s the time to buy

For dividend‑focused investors looking ahead to 2026, Whitecap checks several boxes. We’re talking about a company with a high yield (that’s well covered), solid balance sheet progress, and a track record of disciplined capital allocation. The market still tends to treat many Canadian energy producers as purely cyclical trades. But Whitecap is quietly evolving into a cash‑flow compounder with visible growth and a shareholder‑friendly policy.

The post This TSX Dividend Stock Could Surprise in 2026 appeared first on The Motley Fool Canada.

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* Returns as of February 17th, 2026

More reading

• Looking for Real Income Without the Risk? These 3 TSX Stocks Yield Over 5% and Can Back It Up
• Retirees: Here’s a Cheap Safety Stock That Pays Big Dividends
• Got $14,000? Here’s How to Structure a TFSA for Lifelong Monthly Income
• For Monthly Income, a 5.4% Dividend Stock to Consider
• 2 Top Dividend Stocks to Buy in March

Fool contributor Chris MacDonald has no position in any of the stocks mentioned. The Motley Fool recommends Whitecap Resources. The Motley Fool has a disclosure policy.