Hillcrest Energy Technologies. (CSE: HEAT)
From concept to commercialization, Hillcrest is investing in the development of energy solutions that will power a more sustainable and electrified future.
Holding top dividend stocks and receiving consistent passive income is one of the most comfortable ways for Canadian investors to make money. The good thing is that the Toronto Stock Exchange has a fair share of dividend-paying, high-quality stocks to choose from. If you’re planning to buy a few dividend stocks in August, these Canadian dividend stocks in the energy sector are definitely worth considering.
The Canadian energy sector is home to a large number of quality dividend stocks that offer substantial passive income. While there are plenty of options available to investors, two of the best stocks to buy should be Freehold Royalties (TSX:FRU) and Enbridge (TSX:ENB).
Freehold is an ideal dividend stock, the company’s business model allows it to consistently earn royalty income from energy companies that use its land to produce oil and gas. Not only is this less risky than traditional energy producers, but it also means that Freehold needs to spend less capital expenditure (CAPEX), which allows it to have more cash to return to investors.
Additionally, with lower CAPEX requirements, Freehold can maintain a manageable dividend payout ratio, which not only ensures the sustainability of the dividend, but also allows the company to have extra cash to invest in buying more land and expanding the business. The energy stock’s current 7.6% dividend yield makes it hard for investors to turn down.
Another top dividend stock is Enbridge, which is not only responsible for transporting about 30% of the oil produced in North America and about 20% of the natural gas consumed in the U.S., but also invests in large utilities and energy storage services and has a growing portfolio of renewable energy. It’s worth pointing out that with many long-lived assets, Enbridge is able to consistently generate billions of dollars in free cash flow to invest in future growth and pay a sizable dividend, which currently stands at more than 7.2%.
Brookfield Renewable Partners (TSX:BEP.UN) which owns clean energy generation assets and Emera (TSX:EMA) which is a utility company, are also two dividend stocks to consider in the energy sector. Both companies will have years of growth potential as the world continues to strive to reduce emissions.
As Canada’s largest green energy stock, Brookfield’s global portfolio of renewable energy assets should continue to see strong demand for its services. In addition, the company is constantly looking for new investments to strengthen its portfolio and expand profitability.
Meanwhile, as a diversified utility stock that provides electricity and natural gas, Emera is not only one of the most defensive stocks in the market, it’s also an ideal dividend-growth stock with predictable dividend growth as demand for electricity continues to climb. Brookfield’s current dividend yield stands at 5.7%, and Emera’s at 5.8%.
