Top Canadian Blue Chip Stocks

blue chip stockCan blue chip stocks be part of your winning investment strategy? A successful long term approach to investing is to pick winning stocks and as you probably know, it’s a lot harder to do for a consistent period of time than you can imagine. Many investors and stock analysts will share their opinion on many different stocks but the reality is that there are proven businesses with a long history.

What Are Blue Chip Stocks?

A blue chip stock is a company that is a leader in both market capitalization within its sector, its country and in its business segment. They will often have products that are well-known to everyone and established within the household. A blue chip stock will often pay a dividend and have paid a dividend consistently for many years. While it’s not required to pay a dividend, or have increased the dividend, they usually have established the pattern.

Blue chip stocks are considered to be more defensive with the ability to weather stock market storms. It doesn’t mean the stock price will not go down, it means they are expected to recover due to their established business and strong foothold.

The blue chip reference comes from understanding that a blue chip is the most valuable poker chip if you are curious about the reference. Watch this video for a great explanation.

Stay on top of your next investment decision with the Dividend Snapshot Canadian Dividend Performance List. Review the Chowder Rule along with the 3, 5, and 10 year ratios for dividend growth, EPS growth and the payout ratio to pick a solid investment for your portfolio.

Top 10 Canadian Blue Chip Stocks

The list outlined below is sorted by market capitalization. I own a number of the stocks listed, see my stock holdings for more details. All data points are accurate as of the time of writing.

What you may find interesting is that many of the Canadian Blue Chip Stocks also trade on the NYSE as cross-listed stocks. Please note that from a market capitalization perspective, none of the Canadian REITs have made it on the list below.

You will noticed that the top 10 Canadian blue chip stocks are heavily focused on financials and energy. That can almost sum up the Canadian economy in general. The list of US blue chip stocks would vary and they would be much larger in market capitalization. Consider how important investment diversification is to a dividend income portfolio.

Which of these stocks do you hold as a core holdings?

Royal Bank of Canada – TSE:RY, NYSE:RY

RBC-Royal Bank of Canada

Royal Bank (TSE:RY, NYSE:RY) continues to maintain the largest market capitalization with TD continuously on its tail for the largest company in Canada. Most of its business is in Canada but it has international exposure in the wealth management segment.

Fact Sheet

  • Opportunity Score: 63%
  • Stock Price: $80.10
  • 52 Week Ratio: 95.52% ($64.52 – $80.83)
  • Market Capitalization: $120.82B
  • P/E: 12.06
  • Dividend Yield: 4.04%
  • 10 Year CAGR Dividend Growth: 10.12%
  • Sector: Financial Services
  • RY Stock Trend

Toronto-Dominion Bank – TSE:TD, NYSE:TD

TD - TD BankToronto-Dominion (TD for short) (TSE:TD, NYSE:TD) is the second largest company in Canada. It has established itself in a number of markets in the US from a banking perspective and is making headway south of the border. The main sports arena in Boston is named TD Garden just to show how serious the US market is to the company.

Fact Sheet

  • Opportunity Score: 61%
  • Stock Price: $56.65
  • 52 Week Ratio: 85.74% ($47.75 – $58.13)
  • Market Capitalization: $104.96B
  • P/E: 12.90
  • Dividend Yield: 3.88%
  • 10 Year CAGR Dividend Growth: 9.54%
  • Sector: Financial Services
  • TD Stock Trend

Bank of Nova Scotia – TSE:BNS, NYSE:BNS

BNS - Scotia BankScotia Bank (TSE:BNS, NYSE:BNS) comes in third on the largest Canadian Blue Chip Stocks list and is also third in the banking sector. Scotia Bank has a different strategy which is to go after the Latin American market. International operations supply more than a quarter of Scotia Bank’s earnings.

Fact Sheet

  • Opportunity Score: 61%
  • Stock Price: $65.63
  • 52 Week Ratio: 89.09% ($51.17 – $67.40)
  • Market Capitalization: $79.27B
  • P/E: 11.78
  • Dividend Yield: 4.39%
  • 10 Year CAGR Dividend Growth: 7.50%
  • Sector: Financial Services
  • BNS Stock Trend

Canadian National Railway – TSE:CNR, NYSE:CNI

CNR - Canadian National RailwayCanadian National Railway (TSE:CNR, NYSE:CNI) is the largest non-financial Canadian blue chip stock. In fact, CN is the second largest railway stock in North America after Union Pacific Corporation (NYSE:UNP).

Fact Sheet

  • Opportunity Score: 58%
  • Stock Price: $80.58
  • 52 Week Ratio: 81.21% ($66.62 – $83.81)
  • Market Capitalization: $62.68B
  • P/E: 17,75
  • Dividend Yield: 1.86%
  • 10 Year CAGR Dividend Growth: 17.46%
  • Sector: Industrials
  • CNR Stock Trend

Suncor – TSE:SU, NYSE:SU

SU - SuncorSuncor (TSE:SU, NYSE:SU) is the largest energy stock in Canada. Suncor is involved in every step of the process for bringing gas to the consumer. It has business segments in the following area: exploration, production, refining and supply. As for a retail presence, Petro-Canada represents the retail segment for the consumers.

Fact Sheet

  • Opportunity Score: 42%
  • Stock Price: $36.08
  • 52 Week Ratio: 67.23% ($27.32 – $40.35)
  • Market Capitalization: $59.90B
  • P/E: N/A (negative earnings)
  • Dividend Yield: 3.22%
  • 10 Year CAGR Dividend Growth: 25.25%
  • Sector: Energy
  • SU Stock Trend

Bank of Montreal – TSE:BMO, NYSE:BMO

BMO - Bank of MontrealBank of Montreal (TSE:BMO, NYSE:BMO) is yet another financial institution making the top market capitalization list. Through the acquisition of Marshall & Isley in 2010, BMO gained a strong foothold in the US banking. Most recently, it acquired General Electric Capital Corporation’s Transportation Finance Business through BMO Harris Bank.

Fact Sheet

  • Opportunity Score: 54%
  • Stock Price: $84.73
  • 52 Week Ratio: 98.57% ($64.01 – $85.03)
  • Market Capitalization: $54.75B
  • P/E: 12.72
  • Dividend Yield: 4.06%
  • 10 Year CAGR Dividend Growth: 5.76%
  • Sector: Financial Services
  • BMO Stock Trend

Bell Canada – TSE:BCE, NYSE:BCE

BCE - Bell CanadaBell Canada (TSE:BCE, NYSE:BCE) has a strong footprint in both Ontario and Quebec with its Fibe Internet and TV products which provides a coverage of 66% of the Canadian population. Aside from providing a telecomunication service to customers and businesses, it also has a media business segment for television content.

Fact Sheet

  • Opportunity Score: 51%
  • Stock Price: $62.52
  • 52 Week Ratio: 94.24% ($51.56 – $63.19)
  • Market Capitalization: $54.38B
  • P/E: 19.78
  • Dividend Yield: 4.37%
  • 10 Year CAGR Dividend Growth: 6.88%
  • Sector: Communication Services
  • BCE Stock Trend

Enbridge – TSE:ENB, NYSE:ENB

ENB - EnbridgeEnbridge (TSE:ENB, NYSE:ENB) is in the business of bringing energy to your doorstep. When it’s not focused on moving products through its pipeline for storage or refining, it provides natural gas to homes in Ontario operating as a utility. It has a large network of pipeline (27,582 kilometres) for moving crude oil around our vast lands.

Fact Sheet

  • Opportunity Score: 50%
  • Stock Price: $53.94
  • 52 Week Ratio: 70.50% ($40.03 – $59.76)
  • Market Capitalization: $49.47
  • P/E: 30.47
  • Dividend Yield: 3.93%
  • 10 Year CAGR Dividend Growth: 13.59%
  • Sector: Energy
  • ENB Stock Trend

TransCanada Pipeline – TSE:TRP, NYSE:TRP

TRP - TransCanada PipelineTransCanada Pipeline (TSE:TRP, NYSE:TRP) is another energy company in the business of bringing energy to your doorstep. It has a larger pipeline network (67,300 kilometers) than Enbridge and covers different locations.

Fact Sheet

  • Opportunity Score: 21%
  • Stock Price: $61.19
  • 52 Week Ratio: 98.80% ($40.58 – $61.44)
  • Market Capitalization: $48.94B
  • P/E: N/A (negative earnings)
  • Dividend Yield: 3.69%
  • 10 Year CAGR Dividend Growth: 5.48%
  • Sector: Energy
  • TRP Stock Trend

Canadian Natural Resources – TSE:CNQ, NYSE:CNQ

CNQ - Canadian Natural ResourcesCanadian Natural Resources (TSE:CNQ, NYSE:CNQ) is involved in the acquisition, exploration, development, production, marketing and sale of crude oil, natural gas and natural gas liquids (NGLs).

Fact Sheet

  • Opportunity Score: 30%
  • Stock Price: $76.34
  • 52 Week Ratio: 97.62% ($21.27 – $41.85)
  • Market Capitalization: $45.64
  • P/E: N/A (negative earnings)
  • Dividend Yield: 4.24%
  • 10 Year CAGR Dividend Growth: 10.12%
  • Sector: Energy
  • CNQ Stock Trend

Disclaimer: Please note that this blog post represents my opinion and not an advice/recommendation. I am not a financial adviser, I am not qualified to give financial advice. Before you buy any stocks/funds consult with a qualified financial planner. Make your decision at your own risk – see my full disclaimer for more details.

Image courtesy of David Castillo Dominici – FreeDigitalPhotos.net

10 Responses to "Top Canadian Blue Chip Stocks"

    1. @Dave,

      I honestly could not tell you what an interest sensitive stock is. That falls into market timing for me and I try to focus on good companies with solid businesses. With dollar cost averaging and the performance of the company, we should make money.

      Reply
  1. @Dividend Earner,
    I think what Dave meant was are you continuing to invest in stocks that under perform in higher interest rate environments such as the high yeild electricity utilities

    Reply
    1. @Mill_investor

      I understand the question but identifying whether a stock is interest sensitive or not is not something I focus on. News channels appear to make news out of the topic but I focus on the business and growth as opposed to whether or not investors will flock to bonds at the next interest rate increase. Take Fortis for example, it will pay the dividend it pays now and it will be value based on its earnings. The company valuation across Canada and the US isn’t based on interest rates. I also don’t know how to identify stocks that under performs higher interest rate environments. Is it pre-defined? Are they listed somewhere?

      My investing style is not about trying to predict what others will do when X, Y, or Z will happen. If I pick a good investment, I should benefit from it. Warren Buffett said it best: Price is what you pay, value is what you get.

      Will money move out of stocks when interest rates change? Possible. Will we see fluctuations? Possible. However, a company that earns money, profits, and grows its bottom line will see its stock price go up. Focus on the business you invest in and not the high yield.

      Reply
  2. Just found your site, looks really great and love how you explain your thought process along the way. I live out in the Fraser valley and a friend of mine and I got into dividend investing and overall personal finance a year ago so our portfolios are slowly growing.

    We screened a few of the stocks above, including the big banks and they seem over valued right now, what are your thoughts?

    Reply

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