Often, passive income investors look to secure dividends. After all, if you’re looking to leverage dividends as a source of income, reliability is key.
Today, many stocks have been forced to cut their dividends this year. However, many stocks still trade with reliable dividends.
These are usually stocks with diversified income streams and which provide non-cyclical and essential services. So it means things like utilities, banks, groceries, etc.
Indeed, these are stocks that have continued to post solid figures despite the economic challenges. As such, they are able to safely support the dividend they offer.
Today we will look at two TSX stocks offering investors safe dividends.
Fortis (TSX: FTS) (NYSE: FTS) is a leading Canadian utility provider, with service operations on several continents. At the time of this writing, it is trading at $ 52.13 and a yield of 3.88%.
Most Canadian investors have at least heard of Fortis and can see that it is a relatively stable stock. After all, it sports a beta of 0.05, which suggests that it is generally very resistant to market movements.
One of the main reasons for this is the way Fortis structures its operations. Namely, the vast majority of the public services it provides are performed under regulated contracts.
This really means that Fortis’ income streams are secure and predictable. As a result, Fortis is able to offer solid and secure dividends to its investors.
The proof is really in the pudding here, and Fortis has a great track record for paying and increasing its dividend. It’ll never be flashy stock to own, but it can get the job done depending on what you’re looking for.
While a 3.88% yield isn’t particularly jaw-dropping, it’s also not a reason to sneeze. Plus, its rock-solid stability makes it even more attractive to income investors.
Fortis is worth a look for those looking for secure dividends for the future.
Bank of Montreal (TSX: BMO) (NYSE: BMO) is a leading Canadian bank. One of its strengths is its strong presence in the United States and Canada.
BMO has long been a hallmark of stability, especially when it comes to secure dividends. In fact, it has the longest active streak in Canada when it comes to paying dividends, having paid one every year since 1829.
This is a remarkable achievement given the enormous challenges any business would have had to face by then. While past performance is not a good indicator of future performance, this type of track record is simply a testament to BMO’s rock-solid stability.
As of this writing, this banking giant is trading at $ 97.47 and a yield of 4.35%. A return well north of 4% associated with a name like BMO should be attractive to income investors.
While there may be some hurdles down the road ahead, long-term feelings for BMO should be broadly positive. If you are looking for secure long-term dividends, BMO is a great name to check out.
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These two stocks offer investors very stable dividends with solid future prospects. Over the long term, these stocks can provide passive investors with reliable income.
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Silly contributor Jared Seguin has no position in any of the stocks mentioned. The Motley Fool recommends FORTIS INC.