Canadian Dividend Aristocrats – The Top Aristocrats in December 2022

Posted on December 7, 2022 by Dan Kent

If you're looking for the best dividend stocks to add to your TFSA or RRSP today, you definitely need to look at Canadian Dividend Aristocrats.

Canadian Dividend aristocrats are popular, especially to newcomers looking to learn how to buy stocks.

What is a Canadian Dividend Aristocrat?

In order for a Canadian company to become a Canadian Dividend Aristocrat, it needs to meet the following criteria:

  • A market cap of at least $300 million
  • The company has increased the dividend for 5 consecutive years
  • Must be listed on the Toronto Stock Exchange and a member of the S&P Canada BMI

To be considered a Dividend Aristocrat in the United States, a US listed company must have raised dividends for 25 straight years.

If we used this criteria to classify Canadian stocks as Dividend Aristocrats, the list below would be trimmed from 88 companies to 11.

And if we were to take it a step further to classify Dividend Kings, which are US listed companies that have raised dividends for 50 consecutive years, there would only be one stock on the list as mentioned above, and that is Canadian Utilities.

How many Dividend Kings are there?

In total, there are 48 Dividend Kings in the United States, meaning there are 48 publicly listed companies that have increased their dividends for 50 consecutive years or longer.

What are the highest paying Dividend Kings?

At the time of writing, you will see Altria (MO), 3M Company (MMM), Canadian Utilities (CU), Leggett & Platt (LEG) and Universal Corporation (UVV) with the highest dividend yields. 

As stock prices change on a daily basis, it is important to check what Dividend Kings have the highest payouts at the time you are reading this article.

What are the Canadian Dividend Kings?

As of right now, Canadian Utilities is the only, and first in Canada's history, Dividend King. This means that Canadian Utilities has raised the dividend by 50 consecutive years or longer. However, we do expect Fortis to hit that goal in the next year, as its streak currently sits at 49 years.

Who should invest in Canadian Dividend Aristocrats?

Because we're talking about consecutive years of dividend increases, dividend growth investors will naturally gravitate towards aristocrat stocks. Of note, they also love monthly dividend payers.

A stock with a long growth streak and low dividend payout ratios has typically provided compounding dividend growth to those who've invested in it, and the longer the growth streak the more likely the company is to continue its growth moving forward.

These growth streaks, along with a low payout ratio to support even further dividend growth, come into play heavily when making investment decisions, especially those who want a consistent and growing dividend payment in retirement.

If you're looking at growth investing or even value investing, you may not find much use for this list.

However, there have been some strong dividend growth stocks that have also provided exponential growth in the form of stock appreciation and even a high yield to Canadian investors over the years, one in particular is Goeasy Limited (TSX:GSY).

Is there an ETF that tracks the Dividend Aristocrats?

If you're not into picking individual stocks but want exposure to some of the best Canadian dividend stocks, you'll want to take a look at the iShares S&P TSX Canadian Aristocrats Index (TSX:CDZ). This aristocrat ETF has a total of 93 stock holdings.

Just understand that it will cost management fees of approximately $6.60 per $1000 invested on an annual basis to own it. Of note, these expenses are factored into the return chart below.

At the time, some of its top holdings contain major pipelines like Enbridge (TSE:ENB), a popular utility stock in Capital Power (TSE:CPX), and an oil and gas producer in Canadian Natural Resources (TSE:CNQ).

Canadian Dividend Aristocrat performance vs the Index

A lot of investors want to know whether they will outperform the market if they purchase Aristocrats.

In order to compare whether or not dividend aristocrats here in Canada outperform the Toronto Stock Exchange, lets look at the past performance since the inception of this TSX Canadian Dividend Aristocrats ETF and compare them to the index itself.

Canadian Dividend Aristocrats by sector

Energy and financial stocks make up the bulk of the TSX Index (over 40%.) As such, when you're looking at this dividend aristocrats list, you'll notice the bulk of the companies are in one of these two sectors.

Unlike during the COVID-19 pandemic in 2020 when both financials and oil and gas were expected to struggle, the tune has changed and we're seeing a very strong resurgence in both sectors.

As a result, it's possible that Canadian Dividend Aristocrats could outperform moving forward in 2023, particularly those focused on the energy and financial sectors. These sectors tend to generate strong earnings, consistent cash flow, along with high dividend yields.

But with all that being said, lets get to our complete list of Canadian Dividend Aristocrats.

Canadian Dividend Aristocrats List

As always, if we've missed any companies on this Canadian Dividend Aristocrats list, feel free to comment below. In total, there are 88 stocks on this list.


 

Disclaimer: The writer of this article or employees of Stocktrades Ltd may have positions in securities listed in this article. Stocktrades Ltd may also be compensated via affiliate links in this post.

Dan Kent

About the author

An active dividend and growth investor, Dan has been involved with the website since its inception. He is primarily a researcher and writer here at Stocktrades.ca, and his pieces have numerous mentions on the Globe and Mail, Forbes, Winnipeg Free Press, and other high authority financial websites. He has become an authority figure in the Canadian finance niche, primarily due to his attention to detail and overall dedication to achieving the highest returns on his investments. Investing on his own since he was 19 years old, Dan has compiled the experience and knowledge needed to be successful in the world of self-directed investing, and is always happy to bring that knowledge to Stocktrades.ca readers and any other publications that give him the opportunity to write. He has completed the Canadian Securities Course, manages his TFSA, RRSPs and a LIRA at Qtrade, and has compiled a real estate portfolio of his primary residence and 2 rental properties, all before his 30th birthday.

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