A tax-free savings account (TFSA) is a great way for Canadian investors to accumulate wealth. By investing in stocks where gains and dividends are not generally taxable, a high-yielding stock such as that of pipeline company Enbridge (TSX:ENB)(NYSE:ENB) can be incredibly attractive within a TFSA.
As one of the leading oil and gas stocks on the TSX, it’s one of the safer options for Canadian investors to put into their portfolios. And the company’s recent financial guidance for 2024 indicates strong continued growth, with Enbridge projecting that its base business EBITDA will grow by over 4% this year while distributable cash flow will rise by 3%.
The company also has a terrific track record for not just paying but also increasing its dividend payments. It has raised its payouts for 29 consecutive years, making it one of the more stable income investments on the TSX. And with its yield already high at 7.5%, investors are getting a great payout from the stock as it is today; hanging on for the long run can result in even more dividend income in the future.
Over the past five years, Enbridge’s stock has risen by 12%. But when including its dividend, the stock’s total returns are up around 56%. As long as you aren’t expecting massive gains from the stock in the short run, Enbridge can be one of the better income stocks to own. Inside of a TFSA, you can just let this stock accumulate recurring dividend income for you for years to come.