Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Got $1,000? 2 Dividend Stocks to Buy for a Powerful Boost

Stock MarketsAug 29, 2021 11:15
Saved. See Saved Items.
This article has already been saved in your Saved Items
Got $1,000? 2 Dividend Stocks to Buy for a Powerful Boost

If you’ve ever got spare cash, it’s always a good idea to turn it into a stream of perpetual passive income. Dividend stocks with robust and predictable returns are rarely a bad investment. With that in mind, here are the top two dividend stocks you should consider buying if you have $1,000 to invest.

Dividend stock 1: Suncor Suncor Energy (TSX:SU)(NYSE:SU) was one of the best-performing stocks this year. It rallied by more than 40% and registered a new 52-week high of $31. However, recently the stock has come under immense selling pressure.

Suncor stock was one of the beneficiaries of the boom experienced as the outlook for oil demand improved in the first half of the year. As oil prices rallied to multi-year highs of $76 a barrel, so too did the stock edge higher. However, fundamentals in the oil market have changed significantly amid the spread of the Delta variant of COVID-19.

Oil prices sell-off concerns Oil prices have tanked to three-month lows near the $60 barrel level. The sell-off has dragged stocks like Suncor too.

Suncor reducing its production forecast from the Fort Hills mine also affirms that things are not looking good in the energy industry. A production cut to the 45,000 to 55,000 barrels a day range from initial guidance of between 65,000 and 85,000 is significant.

Following the recent sell-off, Suncor is currently trading cheap with a price-to-earnings multiple of 26 and a price-to-book multiple of 0.9. Given the downbeat sentiments in the energy industry, the stock is a bargain.

Additionally, the company’s 3.7% dividend yield is enticing for investors looking to generate passive income on the side. As the Delta variant subsides and oil prices recover, this dividend stock could rebound. Meanwhile, this looks like a great chance to buy the dip if you have $1,000 to spare.

Dividend stock 2: Tourmaline Oil Tourmaline Oil (TSX:TOU) is another Canadian energy stock that’s under immense pressure. However, Tourmaline seems to be performing better than Suncor. It’s down just 9% from its high earlier this year. The stock has nearly doubled in value year-to-date.

Tourmaline Oil boasts of a diversified footprint in the oil and natural gas sectors. As demand for natural gas shoots up as oil prices edge lower, the company has succeeded in securing some of its key revenue streams.

In the last six months, Tourmaline Oil revenues have more than doubled, with net income totaling $670 million in the first six months of the year. In contrast, the company posted a net loss of $15 million in the same period last year. With demand for natural gas expected to shoot up, the company remains well-positioned to see an uptick in earnings.

Stable dividends Tourmaline Oil also boasts a stable 2% dividend yield. While it seems small compared to Suncor’s 3.4% and TC Energy’s 5.9%, it’s the sustainability of those dividends that makes it more attractive.

The company exited the second quarter with $343.9 million in free cash flow, leaving it in a solid position to continue paying dividends. Tourmaline Oil has already demonstrated its ability to navigate the downturn in the energy industry, with the stock up 40% compared to just 5% for Suncor year to date.

Additionally, Tourmaline Oil is relatively cheap, going by the price-to-book multiple of 0.96 and price-to-earnings multiple of 7.2. Consequently, it would be a smart play for any investors looking to profit from share price gains and stable dividends.

The post Got $1,000? 2 Dividend Stocks to Buy for a Powerful Boost appeared first on The Motley Fool Canada.

Fool contributor Vishesh Raisinghani has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

This Article Was First Published on The Motley Fool

Got $1,000? 2 Dividend Stocks to Buy for a Powerful Boost

Related Articles

Is Lightspeed (TSX:LSPD) Stock Price Still a Buy?
Is Lightspeed (TSX:LSPD) Stock Price Still a Buy? By The Motley Fool - Dec 05, 2021

Lightspeed Commerce (TSX:TSX:LSPD)(NYSE:LSPD) stock has been in a downward spiral for months. Currently trading for $64, it’s down 59% from its all-time high. The...

Could This Retail Stock Become a Tech Stock?
Could This Retail Stock Become a Tech Stock? By The Motley Fool - Dec 05, 2021

The line between retail and technology has been blurring for years. Nearly everything you can buy in a store is now also available online on the store’s website. This is...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email