Buyers who missed the large rally this 12 months within the TSX are questioning which Canadian dividend shares would possibly nonetheless be buying and selling at affordable costs and are good so as to add to a self-directed Tax-Free Financial savings Account (TFSA) or Registered Retirement Financial savings Plan (RRSP) portfolio targeted on revenue and long-term whole returns.
Financial institution of Nova Scotia
Financial institution of Nova Scotia (TSX:BNS) is up 28% up to now six months. The inventory trades close to $89 per share in comparison with $64 at one level in the course of the April tariff rout however continues to be beneath the $93 it reached in early 2022 earlier than price hikes in Canada and the USA triggered a pullback within the financial institution sector.
A few of Financial institution of Nova Scotia’s friends are buying and selling at document highs and have outperformed the inventory lately. A turnaround plan launched by the brand new CEO who took management in early 2023, nevertheless, ought to assist BNS catch up.
Financial institution of Nova Scotia is shifting development investments away from Latin America to focus extra on the USA and Canada. Beforehand, the financial institution spent billions of {dollars} to accumulate and construct companies in Mexico, Peru, Colombia, Chile and different Latin American international locations on the hopes of benefiting from the growth of the center class as these economies increase. Shareholders, nevertheless, haven’t reaped the anticipated rewards. Financial institution of Nova Scotia bought its operations in Colombia, Costa Rica, and Panama earlier this 12 months. Extra offers may very well be on the best way.
In 2024, the financial institution spent US$2.8 billion to purchase a $14.9% stake in KeyCorp, an American regional financial institution. The deal positions Financial institution of Nova Scotia to increase its U.S. presence.
Financial institution of Nova Scotia reported strong fiscal third-quarter (Q3) 2023 outcomes, sparking the newest upswing within the inventory. Internet revenue was $2.5 billion in comparison with $1.9 billion in the identical interval final 12 months. Provisions for credit score losses got here in at $1.04 billion, barely decrease than in fiscal Q3 2024, however dropped significantly from the $1.4 billion booked in fiscal Q2 2025.
It’s going to take a while for the technique transition to ship full outcomes. Within the meantime, traders can nonetheless decide up an honest 4.9% dividend yield from BNS inventory.
Canadian Nationwide Railway
Canadian Nationwide Railway (TSX:CNR) is down 20% up to now 12 months. The rail big took successful in 2024 because of disruptions brought on by labour strikes and wildfires. The corporate nonetheless managed a small enhance in income in comparison with the earlier 12 months, however income dipped a bit because of greater bills.
In 2025, the tariffs imposed by the USA are impacting commerce volumes from some key U.S. commerce companions in core segments. That is making it tough for CN to offer monetary steerage via 2026 as the corporate tries to estimate demand for its providers. CN operates 20,000 route miles of rail traces connecting Canadian ports on the Pacific and Atlantic with the Gulf Coast in the USA.
Regardless of the uncertainty, CN stays a revenue machine. The corporate generated Q2 2025 earnings of $1.172 billion. Administration revised steerage decrease for the 12 months, however CN nonetheless expects to ship earnings development.
The board raised the dividend in every of the previous 29 years and is profiting from the low share worth to purchase again as much as 20 million shares. Close to-term weak spot would possibly persist, however there’s respectable upside potential when the commerce offers with China, Canada, and Mexico are lastly resolved. CNR sells for $131 per share on the time of writing. It was as excessive as $180 in 2024.
The underside line
Financial institution of Nova Scotia and CN are high Canadian shares paying good dividends that ought to proceed to develop. In case you have some money to place to work, these shares need to be in your radar.
