Canadian Dividend Kings & Aristocrats – February 2026

Investing in Canadian Dividend Kings (sometimes known as Dividend Aristocrats) tends to get more popular when low-risk investment yields start to go down. With safer assets generating so little income, dependable dividend payers begin to look more and more attractive. 

Of course, staying focused on dependable (but but boring) dividends can be a challenge when stocks like Shopify or Palantir are soaring. The real test for any dividend investor is sticking to the plan during booms and busts. Click here to jump directly to my 2026 picks.

Canadian dividend stocks didn’t have an easy time competing with mega-cap tech during parts of 2025. Nvidia, Apple, Microsoft, and the rest of the Mag 7 (plus AI stocks) sucked up most of the oxygen, and there were long stretches where Canadian dividend payers felt almost boring by comparison.

But by the time 2025 wrapped up, the picture looked a lot more balanced.

Canadian dividend stocks finished the year with excellent gains in the neighborhood of a 24% total return. When you combine capital appreciation with steady dividend income, it was a reminder that you don’t need explosive growth every year to make meaningful progress as a long-term investor.

By the end of 2025, the Bank of Canada had moved its policy rate meaningfully lower than where it started the year. That mattered. Lower borrowing costs helped relieve pressure on balance sheets, and yield-focused investors started paying attention again to sectors that had been left for dead when rates were rising.

Telecoms, pipelines, banks, and utilities all benefit from a lower-rate environment in different ways. Interest expense becomes more manageable. Cash flow looks more attractive relative to fixed income. And suddenly those steady-as-they-go dividend aristocrats don’t look so dull.

That doesn’t mean lower rates guarantee strong returns. Banks still have to manage credit risk. Utilities still face heavy capital spending. Telecoms still deal with competition and leverage. But the headwinds are no longer as intense as they were.

Heading into 2026, this is where valuation starts to matter again. The largest U.S. tech companies are excellent businesses. There’s no real debate there. The open question is how much future growth is already priced into their shares. Paying a premium can make sense if growth continues to be explosive. But all it takes is a small hit to revenues or profit margins, and investors can get a lot more skeptical in a hurry.

Canadian dividend growers sit on the other end of that spectrum. Valuations are generally more reasonable. Expectations are lower. A meaningful portion of your return shows up as cash in your account, not just a nebulous stock ticker number.

If markets grind sideways in 2026, or if volatility makes a comeback, that kind of reliability can start to look pretty attractive in hindsight. Dividend kings aren’t designed to win every sprint. They’re built to keep moving forward when conditions are less forgiving.

Top Canadian Dividend King Pick for 2026: Toromount Industries (TIH)

Before moving on to my 2026 pick, it’s worth quickly revisiting how my 2025 Canadian Dividend King choice actually played out.

National Bank turned in another excellent year. Including dividends, the stock delivered a total return of roughly 37% in 2025. That outperformance validated a lot of the original thesis and why I’ve been so high on the stock for the better part of a decade now. Staying focused on the Canadian banking oligopoly, avoiding messy international expansion, maintaining a conservative balance sheet, and pairing solid earnings growth with disciplined dividend increases worked exactly as I hoped.

The bank continued to execute well operationally, loan-loss provisions stabilized, and margins benefited as rate pressures eased. On top of that, National Bank remained one of the most generous dividend growers among the Canadian banks while still keeping its payout ratio in a comfortable range.

That said, success creates its own problems.

After such a strong run, valuation is no longer as compelling as it was when I made the original pick. The dividend yield has come down, expectations are higher, and more investors have noticed just how well National Bank has been executing. It’s still a high-quality business. I just don’t have the same margin of safety I felt a year ago.

I’m a little nervous about some of the very preliminary separation talk creeping into Quebec’s headlines. I’m keeping a close eye on developments there. Which brings me to why I’m looking in a slightly different direction for 2026.

Mike Heroux has convinced me that the way to play Canada’s construction focus for the next few years (data centres, national infrastructure projects, etc) is through Toromount Industries. Quick aside, you can sign up for Mike’s free newsletter and free webinar alerts here.

My 2026 Dividend King pick is Toromont Industries (TIH). It isn’t a flashy stock. It doesn’t have a huge dividend yield (only about 1.25%) or dominate headlines. And it definitely doesn’t get grouped in with the usual Canadian dividend names like the banks, pipelines, or utilities.

What it does have is an excellent dividend triangle. Toromont has raised its dividend every year for more than three decades. Over the last five years it has grown the dividend at a rate of almost 11%! It has a very conservative 31% payout ratio, and shown a consistent ability to increase revenue and profits year after year.

Why Toromont qualifies as a Dividend King

Toromont has quietly built one of the most defensible industrial businesses in Canada. It is one of Caterpillar’s largest dealerships in the country, with a massive territory spanning Ontario, Quebec, Manitoba, Atlantic Canada, and parts of Nunavut. That dealership relationship alone creates a significant barrier to entry as Caterpillar doesn’t hand out territories lightly. Once you have one, it’s very difficult for competitors to muscle in.

That Caterpillar partnership accounts for about 87% of revenue. This includes new and used equipment sales, rentals, and a growing stream of higher-margin product support and service revenue.

The CIMCO segment of Toromont makes up the remaining 13%. This cherry-on-top part of the company designs, engineers, and installs industrial and recreational refrigeration systems, including cold storage, food processing, and arena infrastructure. 

Clearly an investment in Toromont is a bet on industrial activity through demand for Caterpillar’s products. A growing portion of earnings comes from rentals and product support. These areas are steadier, more recurring, and higher margin than straight equipment sales. They also benefit from Toromont’s scale and technician workforce, which takes years to build and train.

That consistent mix of income streams is important. It smooths out the cycle and supports more consistent cash flow, which is exactly what you want if you care about dividend growth.

In its most recent quarter, Toromont reported a mixed top-line picture but a much stronger bottom line. Revenue dipped slightly as new equipment sales in mining came off a tough comparison. At the same time, earnings per share rose meaningfully thanks to better execution, higher service activity, and strong growth at CIMCO. Bookings surged, and backlog finished the quarter at roughly $1.3 billion. That backlog provides real visibility into future revenue and helps dampen near-term economic noise.

Toromont runs with an unusually conservative financial profile for a cyclical industrial company. Net debt is minimal, and at times the company has operated in a net cash position. That flexibility gives management room to invest, buy back shares, and grow the dividend without stretching. The company has shown signs that it will repurchase up to roughly 10% of its public float through late 2026. That’s another shareholder-friendly signal.

Obviously, it should go without saying that no stock is perfect. Toromont is exposed to cyclical end markets like construction and mining. A sharp economic slowdown or pullback in government infrastructure spending would hurt results.

But I think those risks are pretty minimal at this point. To me, the data centre boom, along with Carney’s commitment to big Canadian infrastructure projects puts a pretty solid floor underneath cyclical industrials for the time being. If Canada has to go into debt to build, I’m pretty sure that we will do that without blinking given the mood of the country at the moment.

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 2026.

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 Canadian dividend investing for my leveraged portfolio, significant portions of my RRSP and TFSA portfolios, and our corporate portfolio. We currently collect $85,700 per year in dividends, and you can read more about that in my most recent net worth update if you’re interested.

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

While Canada’s total stock market is the 6th largest in the world (slightly behind the UK and India, but ahead of heavyweights like France and Germany) there is actually a fairly small number of quality dividend stocks.

In our article on the top Canadian dividend growth stocks, you will see a number of Dividend Achievers (10 years+ ), a handful of Dividend Aristocrats (25 years+), and then we have a pair of genuine Dividend Kings in Canadian Utilities and Fortis. Those two utility companies can boast of paying out a dividend that hasn’t been cut in more than five decades!

Behind those two government-regulated utility monopolies we have this year’s Canadian Dividend Aristocrat pick of Toromont Industries, with over three decades of un-cut dividends! I think it’s important to contextualize that Canada just doesn’t have as many big international companies as the USA, so just because something isn’t officially a “dividend king” in the American sense of the word, doesn’t mean it’s not a worthy, high-quality dividend stock.

As of February 2026

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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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. 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.

Dividend King Investments for Canadian Retirees

Canadian retirees love collecting stable, dependable Canadian dividends. It makes sense that amongst those who prioritize stability and income flow, Dividend Kings and Dividend Aristocrats are in the highest demand.

In addition to the obvious reasons for retirees to love Canadian blue chip companies with strong balance sheets, there is a bit of a hidden reason as well: the tax advantages. Canadian dividend income is actually taxed at a negative rate until you hit the $40,000-$50,000 range (exact figure depends on which province you live in).

This means that a retired couple can earn close to $100,000 in Canadian dividend income before they pay a dime in income tax! At lower income thresholds, that negative tax rate can actually help offset income tax owing from part-time work or CPP/OAS payments.

Of course, it should be pointed out that one must hold these Canadian dividend stocks outside of their RRSP and TFSA in order to benefit from this tax treatment. It’s also important to understand that this advantageous tax treatment only pertains to Canadian stocks, and not to American or other international stocks. Dividends generated by those companies will almost assuredly be hit with a withholding tax before you get the money in your brokerage account.

Given the tax benefits and relative stability (still more risky than a Canadian GIC) it’s no wonder that Canadian Dividend King stocks are a hit with retirees. It is key to remember though, that diversity is your investing friend. It can be easy to become too focused on one specific type of company within the Canadian market. 

Canadian Dividend King FAQ

Canadian Dividend King 2025 Outlook

Investing in Dividend Kings or Dividend Aristocrats is not about chasing fast money or trying to time the short-term gyrations of the market. It’s about owning businesses that have proven they can allocate capital sensibly, operate efficiently, and grow shareholder payouts through all stages of the endless economic cycle.

If you’re patient and focused on long-term results, Canadian Dividend Kings can still play an important role in a portfolio. Not because Canada is a growth juggernaut, but because these companies tend to benefit from stable demand, entrenched market positions, and management teams that understand the value of consistency.

Canada’s economic outlook for 2026 is unlikely to produce fireworks. Given the very high valuations we see on a lot of companies, I don’t see a lot of “can’t miss opportunities.” The gold companies and the Franco-Nevada’s royalty stream are interesting to me, but I don’t know why they’d be better than a basic speculation on the price of gold – and frankly don’t belong on a long-term Dividend King list. The telecom companies have proven worthy of my skepticism over the past couple of years, and even my beloved Canadian bank stocks are trading at very high multiples these days. 

For staying current on dividend developments in both Canada and the U.S., I continue to lean on Dividend Stocks Rock. Mike Heroux does a good job breaking down dividend sustainability, payout ratios, and business fundamentals without sugar-coating the risks. The live webinars are especially useful, because they force real-time answers to real investor questions.

In fact, I first started looking into Toromont based on this recommendations. You can sign up to Mike’s free emails and webinars below, or utilize his premium platform with our exclusive discount!