Amidst a backdrop of economic uncertainty, highlighted by the Bank of Canada's recent rate cut due to potential U.S. tariffs and a contraction in Canada's GDP for November, investors are increasingly seeking stable income sources. In such volatile times, dividend stocks can offer attractive yields and serve as a buffer against market fluctuations; here we explore three TSX-listed companies yielding up to 8.4%.
Overview: Great-West Lifeco Inc. operates in life and health insurance, retirement and investment services, asset management, and reinsurance across Canada, the United States, and Europe with a market cap of CA$44.23 billion.
Operations: Great-West Lifeco Inc.'s revenue segments include life and health insurance, retirement and investment services, asset management, and reinsurance operations across its key markets.
Dividend Yield: 4.2%
Great-West Lifeco recently reported a significant increase in net income to C$4.07 billion, supporting its dividend strategy. The company approved a quarterly dividend increase to C$0.61 per share, reflecting its commitment to returning value to shareholders. With a payout ratio of 56% and cash payout ratio of 43.5%, dividends are well-covered by earnings and cash flows, respectively. Despite trading below fair value estimates, its 4.24% yield is lower than top-tier Canadian dividend payers.
Overview: High Liner Foods Incorporated processes and markets frozen seafood products in North America, with a market cap of CA$464.49 million.
Operations: High Liner Foods generates its revenue primarily from the manufacturing and marketing of prepared and packaged frozen seafood, amounting to $961.30 million.
Dividend Yield: 4.2%
High Liner Foods' dividend payments are well covered by both earnings and cash flows, with payout ratios of 24.3% and 12.2%, respectively, despite a history of volatility. The recent increase in quarterly dividends to C$0.17 reflects management's confidence in operations, although the dividend yield of 4.17% remains below top-tier Canadian stocks. Recent earnings reports show improved net income amidst declining sales, while an expanded share buyback plan indicates strategic capital allocation efforts.
Overview: Peyto Exploration & Development Corp. is an energy company focused on the exploration, development, and production of natural gas, oil, and natural gas liquids in Alberta's Deep Basin with a market cap of CA$3.13 billion.
Operations: Peyto Exploration & Development Corp.'s revenue primarily comes from its oil and gas exploration and production segment, totaling CA$900.94 million.
Dividend Yield: 8.5%
Peyto Exploration & Development's dividend, recently affirmed at C$0.11 per share, remains in the top 25% of Canadian dividend payers but is not well covered by cash flows, with a high payout ratio of 125.5%. Despite a history of volatility and significant insider selling, the company reported increased natural gas and NGL production for Q3 2024. However, its financial position is strained by high debt levels, affecting dividend sustainability.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include TSX:GWO TSX:HLF and TSX:PEY.
