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The 25 Best Canadian Dividend Stocks for U.S. Investors

The U.S. is home to literally thousands of dividend payers, which would seem to eliminate the need to look elsewhere for income. But there's a convincing case to be made for at least a couple dozen Canadian dividend stocks.

Newer income investors often look for the highest-yielding dividend stocks. They see a 7% yield as being better than 6%, 8% yields superior to 7%, and so on. But that's a much riskier proposition than it seems; sometimes, high yields are indicative of a troubled stock or company.

A safer approach is selecting companies with more reasonable current yields that consistently grow their payouts over time. Here in America, many investors look to the Dividend Aristocrats - a group of 57 dividend stocks in the S&P 500 that have improved their annual payouts for at least 25 consecutive years. But America isn't the only part of the world with Aristocrats. Canada, for instance, has 82.

The Canadian Aristocrats' standards aren't as stringent as those of their U.S. counterpart. To qualify for the Canadian Dividend Aristocrats, a stock must be listed on the Toronto Stock Exchange, be a member of the S&P Canada BMI (Broad Market Index), increase its annual payout for at least five consecutive years (it can maintain the same dividend for two consecutive years) and have a float-adjusted market cap of at least C$300 million.

We've trimmed down that list to 25 Canadian dividend stocks that are best suited for American investors. The following 25 Canadian Dividend Aristocrats trade on either the New York Stock Exchange or Nasdaq, and have increased their dividends annually for at least seven years.

Algonquin Power & Utilities

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Market value: $6.6 billion

Dividend yield: 4.2%  

Consecutive annual dividend increases: 8

Analysts' opinion: 8 Buy, 0 Overweight, 4 Hold, 0 Underweight, 0 Sell

Algonquin Power & Utilities (AQN, $13.40) is a Canadian utility company with more than 70 power generation facilities in the U.S. and Canada, serving almost 800,000 customers in three provinces and 13 states, including Illinois, Pennsylvania, Michigan and Minnesota.

AQN is in the midst of a five-year, $7.5 billion capital plan that will see it invest between $1.5 billion and $1.7 billion in 2019 on projects across North America, including a three-farm, 600-megawatt wind generation project in the U.S. Midwest.

Algonquin last raised its quarterly dividend by 10% to 14.1 cents per share for its July payment.

Bank of Nova Scotia

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Market value: $70.8 billion

Dividend yield: 4.8%

Consecutive annual dividend increases: 9

Analysts' opinion: 2 Buy, 1 Overweight, 0 Hold, 0 Underweight, 0 Sell

Bank of Nova Scotia (BNS, $57.98) is one of Canada's "Big Five" banks, serving more than 25 million customers in North America, Latin America, the Caribbean, Central America and Asia-Pacific.

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