Investing in a solid dividend stock can be a great way to increase your portfolio's value over the long haul. And TC Energy (TSX:TRP)(NYSE:TRP) can be an excellent investment option to consider for that purpose. The energy infrastructure company, formerly known as TransCanada, pays a dividend yield of 5.8% which is well above the S&P 500 average of around 1.4%.
On a $25,000 investment, you'd be collecting $1,450 per year – that's significantly more than the $350 you'd collect with the 1.4% payout.
Plus, what's even better is that the company has regularly been increasing its dividend payments over the years, averaging a compounded annual growth rate of 7% over the past two decades.
That's extra incentive to just buy and hold as your dividend income will likely rise over time. That $1,450 dividend income could grow to more than $1,500 in just one year and after five it could be more than $2,000 if the company were to continue with its generous rate hikes.
TC Energy is one of the safer energy investments you can hold as its revenue has been fairly steady over the past four quarters, ranging between $3.1 billion and $3.4 billion. And the company has generated an operating margin of 44% during that time frame. The more than $7 billion in operating cash flow that TC Energy has reported over the trailing 12 months is more than double the $3.4 billion in dividends it has paid out during that time.
With strong financials and a top-yielding payout, TC Energy is not a stock that you'll want to miss out on.
