The Canadian market has shown robust performance, rising 1.2% over the last week and 16% over the past year, with notable gains in the Materials sector. In this favorable environment with earnings forecasted to grow by 15% annually, identifying strong dividend stocks can offer both income and potential for capital appreciation.

Top 10 Dividend Stocks In Canada

Click here to see the full list of 32 stocks from our Top TSX Dividend Stocks screener.

Let's uncover some gems from our specialized screener.

PHX Energy Services

Simply Wall St Dividend Rating: ★★★★☆☆

Overview: PHX Energy Services Corp. offers horizontal and directional drilling services, rents performance drilling motors, and sells motor equipment and parts to oil and natural gas exploration and development companies in Canada, the United States, Albania, the Middle East regions, and internationally with a market cap of CA$437.03 million.

Operations: PHX Energy Services Corp. generates CA$655.05 million in revenue from horizontal oil and natural gas well drilling services.

Dividend Yield: 8.6%

PHX Energy Services recently declared a quarterly cash dividend of C$0.20 per share, payable on October 15, 2024. The company also announced a share repurchase program to buy back up to 3.36 million shares by August 2025. Despite an attractive dividend yield of 8.6%, the payout is not well covered by free cash flows and has been volatile over the past decade, raising concerns about sustainability and reliability for income-focused investors.

• Delve into the full analysis dividend report here for a deeper understanding of PHX Energy Services.

• Our expertly prepared valuation report PHX Energy Services implies its share price may be lower than expected.

Russel Metals

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Russel Metals Inc. operates as a metal distribution and processing company in Canada and the United States, with a market cap of CA$2.27 billion.

Operations: Russel Metals Inc. generates revenue through its Steel Distributors segment (CA$413.80 million), Energy Field Stores segment (CA$984 million), and Metals Service Centers segment (CA$2.84 billion).

Dividend Yield: 4.3%

Russel Metals Inc. declared a dividend of C$0.42 per share, payable on September 16, 2024. The company announced a share repurchase program to buy back up to 5.81 million shares by August 2025, funded from existing cash resources or credit facilities. Despite lower earnings and revenue compared to last year, the dividend remains well-covered by both earnings (payout ratio: 47.2%) and cash flows (cash payout ratio: 40.2%), with stable payments over the past decade.

• Get an in-depth perspective on Russel Metals' performance by reading our dividend report here.

• According our valuation report, there's an indication that Russel Metals' share price might be on the cheaper side.

Sun Life Financial

Simply Wall St Dividend Rating: ★★★★★☆

Overview: Sun Life Financial Inc. is a financial services company that offers savings, retirement, and pension products globally, with a market cap of CA$44.26 billion.

Operations: Sun Life Financial Inc.'s revenue segments include Asia (CA$4.20 billion), Canada (CA$17.81 billion), Corporate (CA$420 million), Asset Management (CA$6.39 billion), and the United States (CA$13.72 billion).

Dividend Yield: 4.2%

Sun Life Financial declared a dividend of C$0.81 per share, payable on September 27, 2024. The company's dividends are well covered by earnings (payout ratio: 59%) and cash flows (cash payout ratio: 48.6%). Despite trading below its estimated fair value, Sun Life maintains stable and reliable dividend payments with a current yield of 4.22%. Recent leadership changes aim to sustain growth and innovation within the company’s Canadian operations.

• Click here and access our complete dividend analysis report to understand the dynamics of Sun Life Financial.

• Upon reviewing our latest valuation report, Sun Life Financial's share price might be too pessimistic.

Key Takeaways

• Gain an insight into the universe of 32 Top TSX Dividend Stocks by clicking here.

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Looking For Alternative Opportunities?

• Explore high-performing small cap companies that haven't yet garnered significant analyst attention.

• Fuel your portfolio with companies showing strong growth potential, backed by optimistic outlooks both from analysts and management.

• Find companies with promising cash flow potential yet trading below their fair value.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include TSX:PHX TSX:RUS and TSX:SLF.

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