Want Easy Passive Income? Go With These 3 Canadian Dividend Aristocrats

Passive income from Dividend Aristocrats like Fortis (TSX:FTS)(NYSE:FTS) is easy.

Golden crown on a red velvet background

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn moresdf

Dividend Aristocrats are my favourite type of stock. These companies have consistently increased their dividends every year for over a decade. In fact, some have been boosting dividends for multiple decades. 

This is the consistency you need to generate easy and reliable passive income for life. If that’s your target, here are the top three Dividend Aristocrats that should be on your watch list. 

Dividend Aristocrat #1

Fortis (TSX:FTS)(NYSE:FTS) is the gold standard for dividend stocks in Canada. It’s a natural monopoly with fantastic management. That means reliable cash flows for shareholders. 

Fortis is a utility company. With operations spread across North America and even the Caribbean, it’s one of the largest energy distributors in the world. Now, the company is investing to boost its already strong position.

By 2026, Fortis management expects to deploy $20 billion in new investments. This includes acquisitions and the development of new facilities in new regions. It also includes roughly $3.8 billion invested in green energy sources. 

These investments should safeguard Fortis’s position. It should also add incremental cash flow. In fact, Fortis expects these investments to help it expand dividends by 6% every year until 2026. 

Fortis has already increased its dividend for 48 years, so another five isn’t beyond the realm of possibility. That’s why this is a top-notch passive-income stock to keep an eye on. 

Dividend Aristocrat #2

BCE (TSX:BCE)(NYSE:BCE) is another excellent Dividend Aristocrat worth keeping an eye on. Canada’s largest telecommunications company has a tight grip on the market. It’s a position that allows it to extract immense profits. 

BCE’s dominance is bad news for subscribers, who pay some of the highest data rates in the world. But it’s great news for shareholders, who have enjoyed annual dividend growth for 13 years. BCE’s current dividend yield of 5.98% is also much higher than the market average. 

The company’s ongoing investments in rural broadband and 5G should cement its position as a market leader. That means shareholders can expect several more years of dividend growth. Add this Dividend Aristocrat to your passive-income basket. 

Dividend Aristocrat #3

Investing in a Dividend Aristocrat is an easy way to make passive income. But if you’re looking for an easier path, you should consider a basket of Dividend Aristocrats. iShares S&P/TSX Canadian Dividend Aristocrats Index ETF (TSX:CDZ) is an excellent example. 

This fund holds roughly 93 stocks that have expanded dividends for five years consecutively. The largest holding is energy giant Keyera. The portfolio also includes some real estate funds, utility companies, and bank stocks. Overall, it’s a well-diversified basket of robust dividend stocks. 

The fund currently trades at a price-to-earnings ratio of 13 and offers a juicy 3.6% dividend yield. Add this to your passive-income radar.  

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Vishesh Raisinghani has no position in any of the stocks mentioned. The Motley Fool recommends FORTIS INC and KEYERA CORP.

More on Dividend Stocks

growing plant shoots on stacked coins
Dividend Stocks

5 Dividend Stocks to Buy With Yields Upwards of 5%

These five companies all earn tonnes of cash flow, making them some of the best long-term dividend stocks you can…

Read more »

funds, money, nest egg
Dividend Stocks

TFSA Investors: 3 Stocks to Start Building an Influx of Passive Income

A TFSA is the ideal registered account for passive income, as it doesn't weigh down your tax bill, and any…

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Dividend Stocks

3 of the Safest Dividend Stocks in Canada

Royal Bank of Canada stock is one of the safest TSX dividend stocks to buy. So is CT REIT and…

Read more »

Growing plant shoots on coins
Dividend Stocks

1 of the Top Canadian Growth Stocks to Buy in February 2023

Many top Canadian growth stocks represent strong underlying businesses, healthy financials, and organic growth opportunities.

Read more »

stock research, analyze data
Dividend Stocks

Wherever the Market Goes, I’m Buying These 3 TSX Stocks

Here are three TSX stocks that could outperform irrespective of the market direction.

Read more »

woman data analyze
Dividend Stocks

1 Oversold Dividend Stock (Yielding 6.5%) to Buy This Month

Here's why SmartCentres REIT (TSX:SRU.UN) is one top dividend stock that long-term investors should consider in this current market.

Read more »

IMAGE OF A NOTEBOOK WITH TFSA WRITTEN ON IT
Dividend Stocks

Better TFSA Buy: Enbridge Stock or Bank of Nova Scotia

Enbridge and Bank of Nova Scotia offer high yields for TFSA investors seeking passive income. Is one stock now undervalued?

Read more »

Golden crown on a red velvet background
Dividend Stocks

2 Top Stocks Just Became Canadian Dividend Aristocrats

These two top Canadian Dividend Aristocrats stocks are reliable companies with impressive long-term growth potential.

Read more »