AUS
NZ
UK
CA
USA
FRA
GER
ESP
ITA
NLD
PRT
SWE
GRC
IND
POL
BRA
ZAF
RUS
CHN
UAE
In the world of investing, dividend stocks have always been a popular choice for those seeking a steady stream of income. While not all discounted dividend stocks are worth the investment, there are some hidden gems in the market that are not only offering high yields but also come with a strong financial standing. Here are three heavily discounted TSX dividend stocks that you may want to consider adding to your portfolio for the long run.
- Allied Properties REIT (TSX:AP.UN)
Real estate investment trusts, or REITs, often offer above-average yields because they are required to distribute most of their earnings as dividends. Allied Properties REIT is one such attractive option, even though it has faced challenges recently.
The REIT has seen a significant decline in its stock value since its pre-pandemic peak. As a result, its yield has more than doubled from its 2019 peak, currently offering a lucrative 10% yield to its investors. For instance, if you invest $20,000 in this REIT within your Tax-Free Savings Account (TFSA), you could start earning a $166 tax-free monthly passive income.
It's worth noting that the payout ratio has grown, and this high level raises concerns. However, so far, there have been no signs of a dividend cut or suspension, making it an intriguing long-term opportunity.
- Alaris Equity Partners (TSX:AD.UN)
Alaris Equity Partners operates with a unique business model. They invest in businesses that require financial assistance but are not willing to give up control over their companies. This approach limits the options for the companies they invest in.
However, Alaris has a track record of making smart investment choices, creating value for all stakeholders, including shareholders. With insiders owning approximately 2.9% of the company, it's clear that those running the company have confidence in its potential.
Although TSX:AD.UN hasn't been a strong performer in terms of capital appreciation in recent years, it's currently trading at a significant discount from its pre-pandemic peak. This has boosted its yield to an attractive 10%. Notably, this yield is backed by a robust payout ratio, indicating its potential for long-term viability.
- Enbridge (TSX:ENB)
Enbridge is a stalwart in the world of dividend stocks, particularly in the energy sector. The company has a remarkable history of paying dividends for about 68 years and has consistently increased its payouts for 28 consecutive years. Enbridge has demonstrated its resilience through various market-wide and sector-specific crises.
What sets Enbridge apart is not just its dividend track record but also its robust business model. The TSX ENB's pipeline business offers a level of revenue stability that's uncommon in the volatile energy sector. Additionally, it has expanded its strength with a substantial natural gas utility business, with plans for further expansion through a U.S. acquisition. Currently, the stock offers an enticing 7.9% yield.
In conclusion, these three companies not only have solid dividend histories but also boast healthy business models and strong market presence, making them excellent choices for long-term dividend investors. While their growth prospects may fluctuate, their ability to generate a consistent stream of income is a compelling reason to consider these stocks as part of your long-term investment strategy.
