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High-growth stocks experienced a major crash in 2022. Investors remain concerned about inflationary pressures, and the possibility of a recession that could impact their growth prospects. Passive-income investors are still relatively safe as most dividend stocks trade in the green on a year to date.
Dividend stocks provide passive income for a monthly period
This market environment highlights why long-term investors should include solid dividend stocks in their portfolios. Investors can generate steady passive income from quality dividend stocks. They can also choose to reinvest the money to increase their potential long-term return. Two of the most popular Canadian dividend stocks are highlighted below if you’re looking for a steady stream of passive income.
Pembina Pipeline stock
Pembina Pipeline (TSX.PPL), (NYSE.PBA), is an infrastructure and energy transportation company. It primarily focuses its efforts on providing energy transport services to the North American oil industry. Although the stock lost nearly 11% in June and is still trading at $46.72 pershare, it still has 22% year-to date gains. The comparison is the TSX Composite This year, benchmark has lost over 12% of its value.
Pembina Pipeline saw a tremendous financial recovery after the 2020 pandemic. In 2021, its adjusted earnings were $1.99 per share, compared with $0.86 per share the previous year. The Canadian energy transport company posted strong results due to rising energy demand and an improved price environment in reopening economies. Street analysts predict that the firm’s bottom line will improve over the next year. They expect a close to 55% YoY increase in its 2022 earnings.
These positive expectations may help the dividend stock to continue its rise, but it also rewards its shareholders with attractive monthly dividends. Pembina recently announced The July dividend was $0.21 per share. This translates to a 5.4% annual yield.
Pizza Pizza Royalty stock
Pizza Pizza Royalty Canadian investors looking to make passive income are advised to invest in PZA (TSX:PZA). This Toronto-based foodservices company indirectly owns almost 624 Pizza restaurants as well as 103 Pizza 73 locations across Canada. PZA stock currently hovers around $12.60 per share after losing more than 10% of its value in the last three months, but it’s still holding 5% year-to-date gains.
Pizza Pizza Royalty saw a 13.6% YoY rise in royalty pool sales and adjusted earnings rose 12.3% YoY for the first quarter. As the global pandemic-related restrictions continue to ease, the company’s royalty pool sales and same-store sales growth rate are likely to improve further in the coming quarters, which should help its stock inch up. Pizza Pizza Royalty will continue to expand its Canadian restaurant network after lifting COVID-driven mandatory construction restrictions.
Like Pembina Pipeline and Pizza Pizza Royalty, Pizza Pizza Royalty distributes monthly dividends. The company announced a 3.8% rise in its monthly dividend. This is equivalent to $0.81 per year and a solid 6.4% yield.