Dividend stocks are attractive for TFSA accounts, since any dividend income or capital appreciation earned on eligible shares is not taxable. Rather than loading up on bank stocks with limited growth and diversification, you may prefer to invest in dividend stocks that cover a range of industries, which will give you more of an opportunity to profit from capital appreciation. While an investment in Toronto-Dominion Bank might provide you with stability, you’ll likely want more diversification to balance out your portfolio.
I have three stocks listed below that cover many different industries and that have yields of over 5% per year.
Currently, the company pays a dividend of 6.5%, which is paid on a monthly basis. Year to date, the stock has produced returns of just 1%; however, as Crombie continues to grow, so too will its stock price. In just three years, the company’s sales have grown 35%, and the most recent year, it saw revenues increase by 8%.
Extendicare Inc. (TSX:EXE) provides senior-care services across Canada with 118 locations. In the past, the company had centres in the U.S., but it sold that part of its business in 2015 and has since focused on its Canadian operations. As the population in Canada gets older and more baby boomers retire, there will be a growing need for senior-care services, and that could mean a lot more demand for Extendicare’s services. Healthcare stocks are low-risk investments because, in many cases, these are expenses that are unavoidable for many consumers, and, as a result, they present investors with a lot of stability.
The stock also has monthly payouts which produce an annual yield of 5.1% for shareholders, and with strong growth, those payouts could rise. In two straight years, the company has seen its sales increase and the top line has grown a total of 30% since 2014. Extendicare is on pace for another good year as sales continue to grow, with the company’s latest quarter showing revenue growth of 5% from 2016.
