As retirees look to build a secure and stable income from their investments, focusing on stocks that offer reliable dividend income and capital preservation is important. For Canadian investors, here are three top TSX stocks you can consider adding to your investment portfolio.
These companies have proven their potential to provide solid returns to investors over the long term. Trading at reasonable valuations, these are among my top picks in this current market for those seeking relative value and a way to maintain their wealth in retirement (relative to inflation).
Restaurant Brands
Restaurant Brands International (TSX:QSR) is a global leader in the fast-food industry, owning iconic brands such as Tim Hortons, Burger King, and Popeyes. These well-established brands have a strong presence worldwide, providing Restaurant Brands investors with a diversified revenue stream that can weather economic uncertainties.
For retirees, Restaurant Brands stock is appealing in part because of its consistent dividend payments. As of now, the company offers a dividend yield of approximately 3.8%, making it an attractive option for income-focused investors. Moreover, the company has demonstrated its ability to grow earnings through strategic initiatives such as menu innovation, digital transformation, and international expansion.
With its stable cash flows and growing global footprint, Restaurant Brands is well-positioned to continue delivering value to shareholders. Retirees looking for a mix of income and growth potential should consider RBI as part of their portfolio.
Fortis
Fortis (TSX:FTS) is one of the leading utility companies in Canada, with operations spanning the Caribbean and the United States. The company focuses on natural gas and regulated electricity transmission, ensuring steady and predictable cash flows.
What makes Fortis particularly attractive is its exceptional track record of dividend growth. The company has increased its dividend for nearly 50 consecutive years, making it a Dividend Aristocrat. Currently, Fortis offers a dividend yield of around 4%, providing a solid source of passive income.
The business model of Fortis is built on regulated utility operations, which ensures predictable revenue and cash flow. In addition, the company’s ongoing investments in renewable energy and infrastructure modernization position it for long-term growth in a transitioning energy landscape. Fortis offers the perfect combination of income stability and defensive qualities for retirees, making it an essential addition to a well-rounded portfolio.
Toronto-Dominion Bank
No list of top TSX stocks for retirees would be complete without mentioning a major Canadian bank, and Toronto-Dominion Bank (TSX:TD) stands out as a top choice. The bank is one of Canada’s largest and most stable financial institutions, with a strong presence in Canada and the United States.
TD’s appeal lies in its reliable dividend payments and potential for long-term growth. The bank currently offers a dividend yield of approximately 5%, making it an excellent source of income for retirees. Furthermore, TD has a solid history of dividend increases, reflecting its strong financial health and commitment to returning value to shareholders.
The diversified business model of the bank includes retail banking, wealth management, and capital markets, which provide multiple revenue streams. Its growing U.S. operations also offer additional growth opportunities. While economic challenges such as rising interest rates and market volatility may pose risks, TD’s prudent risk management and robust capital position make it a resilient choice. Toronto-Dominion Bank offers a blend of income stability and growth potential for retirees, ensuring a balanced approach to long-term investing.