As volatility persists in equity markets, investors are looking for a soft landing to preserve their capital. There is no better place to go than strong dividend payers with proven business models. These companies offer long-term gains with lower risk and tend to outperform the broader market during recessionary periods.
First, we looked for companies with a dividend yield above 3.5 per cent, the approximate yield of the benchmark 10-year Canadian government bond. From there, the goal was to further rank companies on how they are managing investor capital and demonstrating good financial health with consistent cash flow. To do this, we used trailing return on equity and annual operating cash flow momentum .