Canadian Dividend Kings List 2022

A reader has prompted me to update this post for 2022 (originally posted in 2016). Click here to jump directly to my 2022 picks.

Investing in Dividend Kings (aka Dividend Aristocrats) may not be for everyone, but I am a fan.  I like the idea of receiving tax efficient payments from long-established companies with a track record of annually increasing their payments to shareholders.

I also like the idea of getting paid to wait. When the market crashes like it did during the covid-19 pandemic, almost all of my Canadian dividend growth stocks kept paying their dividend. My dividend portfolio value dropped briefly, but my cash was growing nonetheless. This is the true power of dividend growth investing – keeping you in the right long-term investment mindset.  As we head into 2022, my dividend aristocrat-heavy portfolio is actually up substantially from this time last year.

Top Canadian Dividend Pick for 2022: Enbridge (It’s not a sexy environmental infrastructure pick, but this diversified energy giant has proven its commitment to sustainable dividends, and is substantially undervalued as we head into the year.)

October 2021 Update: Rarely do I ever crow about my stock picking credentials, but when I revisited this dividend kings article in late 2021, I realized that I needed some context around how well this Canadian dividend stock has done since I recommended it.

When I made the pick, Enbridge was yielding over 7.5%, and with Line 3 starting to produce revenue this quarter, that dividend looks as safe as ever.  In fact, the company’s forecast of 7% annual dividend growth looks to be right on track.  Additionally, investors would have enjoyed an 18% capital gain on top of that juicy dividend!  

I don’t know where this dividend grower goes from here (I certainly would not be brave enough to forecast future capital gains in that 18% annual territory), but I’m hoping it does lend some credibility!

My insights on Enbridge – as well as the 2022 Canadian Dividend Kings list below – are based on my own research, but also relied heavily on the advice and tools provided by Dividend Stocks Rock.  

DSR not only provides excellent written advice, but also a ton of free webinars, and ideal tools for analyzing both the Canadian and American dividend markets.  Read my DSR review for an in-depth look at just why I’m such a big fan of what fellow Canadian Mike Heroux has put together.

Dividend Aristocrats and Dividend Kings Offer Stable Growth

In fact, many studies (such as Vanguard) have proven that dividend growers are likely to outperform the market and do it with less volatility. Dividend growers such as the best Canadian dividend aristocrats will continue to increase their dividend in 2022.

Canadian companies with a long history of dividend growth will generally show a strong business model and robust financials. They have gone through many recessions and never stopped increasing dividend payments. In times of confusion and fear, you can go back and look at how companies went through the past crisis and kept their dividend streak alive. 

I use the dividend strategy for my leveraged portfolio, a significant portion of my RRSP, and our corporate portfolio.  We currently collect a little over $50,000/year in dividends and if you are interested, you can follow my dividend updates here. You can also view the best Canadian dividend stock for this year here.

In the past, I’ve written a number of articles on dividend growth stocks, I’ve never properly categorized them. Here are the most common dividend terms as they relate to the U.S. stock market:

• A Dividend Achiever is a company that has increased its dividend at least 10 years in a row;
• A Dividend Contender is a traded company that has raised dividends for 10 to 24 consecutive years.
• A Dividend Champion is a company that has increased its dividend at least 25 years in a row (regardless if it is part of the S&P 500 or not);
• A Dividend Aristocrat is a company that is part of the S&P 500 and that has increased its dividend at least 25 years in a row;
• A Dividend King is a company that has increased its dividend at least 50 years in a row.  The true cream of the crop.

Dividend Aristocrats and Dividend Kings in Canada

Here in Canada, we have a relatively small market and an even smaller list of quality dividend stocks.  In a previous article about the top Canadian dividend growth stocks, you will see a number of dividend achievers (10 years + ), a handful of dividend aristocrats (25 years +), but no dividend kings in Canada (although FTS (46) and CU (47) are getting close).

As of January 2022

Canadian Dividend Aristocrat Definition

While I used the terms dividend achievers and dividend aristocrats for the Canadian stock market  in the previous section, I must highlight that the official definition of the Canadian dividend aristocrat differs from the one established in the U.S.

In order to be considered as a S&P Canadian Dividend Aristocrat, the company must have increased its dividend payout every year for five years – Therefore, we are looking at stocks that have a good potential for raising its dividend but still pretty far away from 25 consecutive years.

Dividend Kings List

In a few years, we will be able to have a shortlist of Canadian dividend kings (including Fortis and Canadian Utilities). In the meantime, where do we find these elusive dividend kings? You’ll have to look at the biggest market in the world – the US!  In the US, there are 30 dividend kings that have increased their dividend at least 50 years in a row.  

Here is a table supplied by Dividend Stocks Rock:

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Here is the same table sorted by yield:

As you can see from the list, some of these names are very recognizable with global brand awareness and long term competitive advantage.  Names such as Procter & Gamble, Coke, Johnson & Johnson, 3M, Colgate, and Lowe’s.

You will also notice that most of them show a low dividend yield. From this list, only Altria (MO) shows a yield over 5% (~8.78%). The dividend king average yield is 2.74% with an average dividend growth of 6.50%. This shows you that one must pay for the quality. Finally, most dividend growers will not only reward shareholders with dividend increases, but also with steady capital appreciation.

As a disclaimer, I hold the following dividend kings within my RRSP: Procter & Gamble; 3M; Emerson Electric; Coca-Cola; Target; and, Johnson & Johnson.  Also, this post is not meant to provide recommendations for your portfolio, but a starting point for your research.

If you are interested in dividend investing, here is More Dividend Stock Investing Info:

• Dividend Stocks Rock Newsletter Signup
• How to Build a Dividend Growth Portfolio
• How to buy stocks
• When to buy dividend stocks
• How to create a stock watchlist
• Top Canadian stock screeners