Top 30 Canadian Blue Chip Stocks You Should Own in 2019

A blue chip stock is the stock of a large, well-established and financially sound company that has operated for many years. These stocks have a market capitalization usually in the billions; are generally the market/sector leaders or among the top three companies in its sector, and is more often than not a household name.

The term “blue chip stock” comes from the card game, Poker, where the highest and most valuable playing chip colour is blue

A “blue chip” is the stock of a well-established, financially sound, and historically secure corporation

Blue chip stocks are company stocks which are financially very stable, can withstand market crashes and  pay dividends regularly. The market cap of the Bluechip companies are usually over 500 million at least. I mean to say with the same amount invested over the years your dividends tend to increase because of the dividends percent raise from these companies.

Investing in blue chip stocks may have a reputation for being boring, stodgy, and perhaps even a little outdated. However, it isn’t an accident that they are overwhelmingly preferred by wealthy investors and rock-solid financial institutions. Anyone with common sense would want a stake in businesses they not only understand but that have a demonstrated record of extreme profitability over generations, and blue chips stocks certainly fit the description.

Every portfolio should contain at-least a couple of blue chip stocks for stability and for long term portfolio growth.

Another reason blue chip stocks are popular is that they offer somewhat of a relatively safe harbour during economic catastrophes (especially if coupled with gilt-edged bonds and cash reserves). Inexperienced and poorer investors don’t think about this too much because they’re almost always trying to get rich too quickly, shooting for the moon, looking for that one thing that will instantly make them rich. It hardly ever ends well. Markets will collapse. You will see your holdings drop by substantial amounts no matter what you own

Blue chip stocks often represent companies residing at the core of American and global business; firms boasting pasts every bit as colourful as any novel and interwoven with politics and history. Their products and services permeate nearly every aspect of our lives.

 

   
We will have two sections to segregate the blue chip stocks:

1. Company valuation

2. Company dividends

Measured across long periods, blue chip stocks have minted money for owners prudent enough to hang on to them with tenacity through thick and thin, good times and bad times, war and peace, inflation and deflation

In addition, I have split the stocks into 12 sectors just to make it easy to identify. These are the best Canadian blue chip stocks to own for any type of portfolio –

1. Financial

Bank of Montreal ( TSE : BMO)

Valuation
Price/Earning: 12.6x
Book Value: $61.35
Price/book: 1.5x
Cash flow: $8.27

Dividend
5 year Dividend growth: 2.96%
Annual dividend: $3.44
Dividend yield: 4.06%

Bank of Nova Scotia (TSE : BNS)

Valuation
Price/Earning: 12.4x
Book Value: $43.24
Price/book: 1.7x
Cash flow: $6.31

Dividend
5 year Dividend growth: 6.77%
Annual dividend: $2.96
Dividend yield: 4.22%

Toronto-Dominion Bank (TSE:TD)

Valuation
Price/Earning: 13.1x
Book Value: $35.24
Price/book: 1.6x
Cash flow: $4.96

Dividend
5 year Dividend growth: 10.39%
Annual dividend: $2.20
Dividend yield: 3.76%
payout ratio: 47.71%
payout ratio: 49.99%
payout ratio: 49.86%

Royal Bank (TSE:RY)

Valuation
Price/Earning: 12.0x
Book Value: $43.07
Price/book: 2.0x
Cash flow: $7.88

Dividend
5 year Dividend growth: 9.02%
Annual dividend: $3.32
Dividend yield: 4.01%
payout ratio: 46.46%

The best blue chip stocks offer both capital gains growth potential and regular dividend income. The dividend yield is certainly one of the most concrete indicators of a sound investment. It is the percentage you get when you divide the current yearly dividend payment by the share or unit price of the investment

National Bank of Canada (TSE:NA)

Valuation
Price/Earning: 13.2
Book Value: $31.30
Price/book: 1.6x
Cash flow: $4.90

Dividend
5 year Dividend growth: 10.47%
Annual dividend: $2.20
Dividend yield: 4.85%
payout ratio: 80.74%

blue chip stocks

After all, who remembers Coca-Cola losing around 50% of its value due to the sugar crisis shortly after its IPO? A single share bought for $40, which crashed down to $19, is now worth more than $15,000,000 with dividends reinvested

Canadian Imperial Bank of Commerce (TSE:CM)

Valuation
Price/Earning: 9.7x
Book Value: $53.76
Price/book: 1.8x
Cash flow: $11.47

Dividend
5 year Dividend growth: 4.32%
Annual dividend: $4.84
Dividend yield: 4.83%
payout ratio: 45.17%

Sun Life Financials Inc (TSE:SLF)

Valuation
Price/Earning: 13.1x
Book Value: $34.98
Price/book: 1.4x
Cash flow: $-

Dividend
5 year Dividend growth: 0.95%
Annual dividend: $1.62
Dividend yield: 3.73%
payout ratio: 46.71%

Brookfield Asset Management Inc (TSE:BAM.A)

Valuation
Price/Earning: 27.3x
Book Value: $34.59
Price/book: 1.6x
Cash flow: $6.69

Dividend
5 year Dividend growth: 6.43%
Annual dividend: $0.52
Dividend yield: 1.45%
payout ratio: 72.10%

Intact Financial Corporation (TSE:IFC)

Valuation
Price/Earning: 18.2x
Book Value: $43.54
Price/book: 2.3x
Cash flow: $5.08

Dividend
5 year Dividend growth: 9.28%
Annual dividend: $2.32
Dividend yield: 2.49%
payout ratio: 52.80%

2. Real Estate – REIT’s

RioCan Real Estate Investment Trust (TSE : REI.UN)

Valuation
Price/AFFO: 17.02x
Book Value: $24.58
Price/book: 1.1x
AFFO: $1.57

Dividend
5 year Dividend growth: 0.43%
Annual dividend: $1.41
Dividend yield: 5.27%
payout ratio (based on AFFO): 89.80%

Canadian Apartment Properties Real Estate Investment Trust (TSX:CAR.UN)

Valuation
Price/AFFO: 17.57x
Book Value: $28.79
Price/book: 1.0x
AFFO: $1.69

Dividend
5 year Dividend growth: 2.19%
Annual dividend: $1.25
Dividend yield: 4.21%
payout ratio (based on AFFO): 73.9%

Boardwalk REIT(TSE:BEI.UN)

Valuation
Price/AFFO: 16.18x
Book Value: $62.56
Price/book: 0.8x
AFFO: $3.23

Dividend
5 year Dividend growth: 2.53%
Annual dividend: $2.25
Dividend yield: 4.31%
payout ratio (based on FFO): 69.66%

3. Energy :

Enbridge (TSE:ENB)

Valuation
Price/Cash flow: 16.7x
Book Value: $21.77
Price/book: 3.9x
Cash flow: $3.68

Dividend
5 year Dividend growth: 11.85%
Annual dividend: $2.12
Dividend yield: 3.67%
payout ratio (based on FFO): 57.60%
TransCanada Corporation (TSE:TRP)

Valuation
Price/DCF: 12.23x
Book Value: $23.40
Price/book: 3.1x
Distributable Cash Flow (DCF): $5.00

Dividend
5 year Dividend growth: 5.39%
Annual dividend: $2.26
Dividend yield: 3.70%
payout ratio (based on DCF): 45.2%

Suncor Energy Inc (TSE:SU)

Valuation
Price/Earning: – (negative value)
Book Value: $27.00
Price/book: 1.4x
Cash flow: $3.39

Dividend
5 year Dividend growth: 23.30%
Annual dividend: $1.16
Dividend yield: 3.09%
payout ratio: – (negative value)

Imperial Oil Limited (TSE:IMO)

Valuation
Price/Earning: 122.5x
Book Value: $27.62
Price/book: 1.6x
Cash flow: $2.27

Dividend
5 year Dividend growth: 4.63%
Annual dividend: $0.69
Dividend yield: 1.30%
payout ratio: 158.86%

4. Telecommunication Services 

BCE Inc (TSE:BCE)

Valuation
Price/Earning: 19.1x
Book Value: $19.67
Price/book: 4.2x
Cash flow: $7.28

Dividend
5 year Dividend growth: 7.81%
Annual dividend: $2.73
Dividend yield: 4.53%
payout ratio: 90.00%

Rogers Communication Inc (TSE:RCI.B)

Valuation
Price/Earning: 20.0x
Book Value: $11.16
Price/book: 4.7x
Cash flow: $7.34

Dividend
5 year Dividend growth: 8.45%
Annual dividend: $1.92
Dividend yield: 3.54%
payout ratio: 70.32%

Telus Corporation (TSE:T)

Valuation
Price/Earning: 18.0x
Book Value: $12.91
Price/book: 3.1x
Cash flow: $5.71

Dividend
5 year Dividend growth: 10.93%
Annual dividend: $1.84
Dividend yield: 4.34%
payout ratio: 73.94%

5. Utilities :

Fortis Inc (TSE:FTS)

Valuation
Price/Earning: 21.1x
Book Value: $35.09
Price/book: 1.4x
Cash flow: $5.25

Dividend
5 year Dividend growth: 4.49%
Annual dividend: $1.60
Dividend yield: 3.76%
payout ratio: 72.07%

Canadian Utilities (TSE:CU)

Valuation
Price/Earning: 26.6x
Book Value: $23.20
Price/book: 2.2x
Cash flow: $3.91

Dividend
5 year Dividend growth: 9.34%
Annual dividend: $1.30
Dividend yield: 3.50%
payout ratio: 108.92%

Emera Inc (TSX:EMA)

Valuation
Price/Earning: 14.4x
Book Value: $28.53
Price/book: 2.0x
Cash flow: $5.77

Dividend
5 year Dividend growth: 7.42%
Annual dividend: $2.09
Dividend yield: 4.47%
payout ratio: 55.82%

Brookfield Renewable Energy Partners LP (TSE:BEP.UN)

Valuation
Price/FFO: 22.07x
Book Value: $32.83
Price/book: 1.15x
Cash flow: $6.34

Dividend
5 year Dividend growth: 5.78%
Annual dividend: $1.78 (USD)
Dividend yield: 5.74%
payout ratio: 105.3%

Algonquin Power & Utilities Corp (TSE:AQN)

Valuation
Price/AFFO: 10.01x
Book Value: $7.56
Price/book: 1.42x
AFFO: $1.15

Dividend
5 year Dividend growth: 15.16%
Annual dividend: $0.49
Dividend yield: 4.82%
payout ratio (based on AFFO): 42.6%

blue chip stocks

6. Materials :

Agrium Inc (TSE:AGU)

Valuation
Price/Earning: 14.3x
Book Value: $57.15
Price/book: 1.9x
Cash flow: $13.01

Dividend
5 year Dividend growth: 83.20%
Annual dividend: $3.50
Dividend yield: 3.89%
payout ratio: 55.76%

7. Information Technology :

CGI Group Inc (TSE:GIB.A)

Valuation
Price/Earning: 18.8x
Book Value: $19.68
Price/book: 3.1x
Cash flow: $4.57

Dividend
5 year Dividend growth: 0%
Annual dividend: $0
Dividend yield: 0%
payout ratio: –

In plain English, when you ask, “what are blue chip stocks?” the answer is usually shares in a company you already know. Companies that have stood the test of time and pose less risk to an investor even in the worst financial crises are blue chip stocks companies. Coca-Cola and Apple are two good examples

Blue chip stocks we recommend have a history of earnings and, in most cases, a history of sustainable dividends. They have established their value over the long term. Like all stocks, they can fluctuate widely and many suffer in a long-term market downturn, but they offer a higher probability of long-term gains

8. Consumer :

Saputo Inc (TSE:SAP)

Valuation
Price/Earning: 29.0x
Book Value: $10.20
Price/book: 4.5x
Cash flow: $2.12

Dividend
5 year Dividend growth: 11.35%
Annual dividend: $0.60
Dividend yield: 1.28%
payout ratio: 33.11%

Loblaw Companies Limited (TSE:L)

Valuation
Price/Earning: 41.7x
Book Value: $32.08
Price/book: 2.1x
Cash flow: $5.33

Dividend
5 year Dividend growth: 3.44%
Annual dividend: $1.04
Dividend yield: 1.56%
payout ratio: 63.22%

Metro Inc (TSX:MRU)

Valuation
Price/Earning: 18.0x
Book Value: $10.91
Price/book: 3.6x
Cash flow: $3.12

Dividend
5 year Dividend growth: 15.83%
Annual dividend: $0.56
Dividend yield: 1.34%
payout ratio: 23.53%

Blue chip stocks are your best promise of investment quality—and of strong returns for years to come

9. Consumer Discretionary :

Canadian Tire Corporation Limited (TSE:CTC)

Valuation
Price/Earning: 14.6x
Book Value: $67.63
Price/book: 2.0x
Cash flow: $16.00

Dividend
5 year Dividend growth: 20.11%
Annual dividend: $2.30
Dividend yield: 1.18%
payout ratio: 24.64%

Magna Internations Inc (TSE:MG)

Valuation
Price/Earning: 8.5x
Book Value: $29.28
Price/book: 1.7x
Cash flow: $9.48

Dividend
5 year Dividend growth: 29.71%
Annual dividend: $1.00
Dividend yield: 2.34%
payout ratio: 18.47%

Cineplex Inc (TSX:CGX)

Valuation
Price/Earning: 25.3x
Book Value: $12.11
Price/book: 4.4x
Cash flow: $3.54

Dividend
5 year Dividend growth: 4.10%
Annual dividend: $1.62
Dividend yield: 3.15%
payout ratio: 77.49%

Thomson Reuters Corporation (TSE:TRI)

Valuation
Price/Earning: 26.0x
Book Value: $21.76
Price/book: 2.5x
Cash flow: $4.81 

Dividend
5 year Dividend growth: 2.93%
Annual dividend: $1.36
Dividend yield: 3.34%
payout ratio: 87.68%

Blue chip stocks, also known as large cap stocks(because the companies have a high market capitalization of $1 billion or more), tend to rise and fall in conjunction with the stock market in general.Examples of blue chip stocks include Coca-Cola, Disney, Intel, and IBM

     10. Infrastructure and Transportation :

Canadian National Railway Company (TSE:CNR)

Valuation
Price/Earning: 19.2x
Book Value: $18.99
Price/book: 4.5x
Cash flow: $6.03

Dividend
5 year Dividend growth: 18.28%
Annual dividend: $1.50
Dividend yield: 1.72%
payout ratio: 29.96%

Brookfield Infrastructure Partners L.P (TSE:BIP.UN)

Valuation
Price/FFO: 14.25x
Book Value: $16.65
Price/book: 2.0x
FFO: $3.14

Dividend
5 year Dividend growth: 14.02%
Annual dividend: $2.04
Dividend yield: 4.0%
payout ratio (based on FFO): 64.50%

blue chip stocks

XTC – Exco Technologies Limited

Opportunity Score: 89%
Stock: TSE:XTC
Sector: Consumer Cyclical
Dividend Yield: 3.25%
Dividend Payout Ratio: 29.91%

CIBC – Canadian Imperial Bank of Commerce

Opportunity Score: 86%
Stock: TSE:CM, NYSE:CM
Sector: Financial Services
Dividend Yield: 4.96%
Dividend Payout Ratio: 47.27%

SU – SmallSuncor

Opportunity Score: 86%
Stock: TSE:SU
Sector: Energy
Dividend Yield: 3.24%
Dividend Payout Ratio: 79.01%

MRU – Metro Inc.

Opportunity Score: 85%
Stock: TSE:MRU
Sector: Consumer Defensive
Dividend Yield: 1.59%
Dividend Payout Ratio: 25.90%

CP – SmallCanadian Pacific

Opportunity Score: 85%
Stock: TSE:CP
Sector: Industrials
Dividend Yield: 1.16%
Dividend Payout Ratio: 20.18%

ATCO – ATCO Group

Opportunity Score: 83%
Stock: TSE:ACO.X
Sector: Utilities
Dividend Yield: 2.85%
Dividend Payout Ratio: 47.81%

CU – Canadian Utilities Limited

Opportunity Score: 81%
Stock: TSE:CU
Sector: Consumer Cyclical
Dividend Yield: 3.65%
Dividend Payout Ratio: 66.82%

BMO – Bank Of Montreal

Opportunity Score: 80%
Stock: TSE:BMO
Sector: Industrials
Dividend Yield: 4.02%
Dividend Payout Ratio: 44.28%
Technical Trend: Technical Trend Analysis
First National Financial Corporation

FN – First National

Opportunity Score: 80%
Stock: TSE:FN
Sector: Financial Services
Dividend Yield: 7.15%
Dividend Payout Ratio: 49.60%

SAP – Saputo

Opportunity Score: 80%
Stock: TSE:SAP
Sector: Consumer Defensive
Dividend Yield: 1.42%
Dividend Payout Ratio: 31.58%

Top 10 Canadian Blue Chip Stocks of All Time – 2019

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

RBC-Royal Bank of Canada

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

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

TD – TD Bank Toronto-Dominion Bank

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

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

BNS – Scotia Bank

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

4. Canadian National Railway – TSE:CNR, NYSE:CNI

CNR – Canadian National Railway

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

5. Suncor – TSE:SU, NYSE:SU

SU – Suncor

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

6. Bank of Montreal – TSE:BMO, NYSE:BMO

BMO – Bank of Montreal

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

7. Bell Canada – TSE:BCE, NYSE:BCE

BCE – Bell Canada

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

Blue chip stocks come from companies whose stocks have a national reputation for quality, reliability and the ability to operate profitably in good times and bad

8. Enbridge – TSE:ENB, NYSE:ENB

ENB – Enbridge

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

9. TransCanada Pipeline – TSE:TRP, NYSE:TRP

TRP – TransCanada Pipeline

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

10. Canadian Natural Resources – TSE:CNQ, NYSE:CNQ

CNQ – Canadian Natural Resources

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

Whether we’re talking about socks or stocks, I like buying quality merchandise, when it is marked down. – Warren Buffett

These are the best Canadian Blue Chip Stocks to buy for 2019. Please leave us your thoughts and comments below.

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Daniel Lucas
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Daniel Lucas

Great read! I think every investor should learn from what you’ve written here. I do have a Blue chip stock in Toronto-Dominion Bank and it’s been a wonderful experience so far.

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Admin

Thank you Daniel 🙂

Rachel
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Rachel

Very insightful. Getting a blue chip stock is a very wise way to go by every investor that understands the game.

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Admin

Thank you Rachel 🙂

Mitchell
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Mitchell

Indeed an eye opener! These are things I’d yearn to know few months back. However, I don’t think it’s too late either. It’s time I look into getting few blue chip stocks in some of these investments. It will be really wise.

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Admin

Thank you Mitchell 🙂

David Smith
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David Smith

I absolutely agree with you that getting a few blue chip stocks in one’s portfolio is a wise decision any serious investor could make. I can’t imagine myself making such mistake again. The last experience was a terrible one. Nice post. Thanks!

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Thanks David 🙂

ilmu pelet
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Prevention of Heart Attack
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Hilario
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Wow, amazing blog format! How lengthy have you ever been running a blog for?

you made running a blog glance easy. The
whole look of your website is great, let alone the content
material!

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Thank you ilmu pelet!

John Adams
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John Adams

Thank you! Great post and tons of information 🙂