Best Canadian Stocks

Global Flavors, Local Impact: A Recipe for Dividend Growth

Fast food is no longer just about convenience—it’s about brand power, menu innovation, and the ability to adapt to changing consumer tastes across diverse geographies. The company we’re looking at today commands some of the most recognized quick-service brands in the world, each with its own loyal following. With a franchise-heavy model, it thrives on scale, efficiency, and international growth opportunities, while still contending with industry-wide pressures like labor costs and price-sensitive consumers.

Behind the Counter: How the Business Works

Restaurant Brands International (QSR.TO) operates a portfolio of well-known quick-service restaurant chains: Tim Hortons (coffee and baked goods), Burger King (flame-grilled hamburgers), Popeyes Louisiana Kitchen (fried chicken and seafood), and Firehouse Subs (hot subs). It runs through a predominantly franchise-based model, generating revenue from royalties, lease income, and sales at company-owned locations.

Tim Hortons remains the market leader in Canada, offering beverages, baked goods, and all-day food menus.
Burger King drives scale globally, with operations in over 100 countries, though it faces challenges in North America.
Popeyes delivers strong unit-level economics with its Louisiana-style menu and growing global presence.
Firehouse Subs is expanding in the U.S. and selectively internationally, targeting the premium sandwich market.

The franchise-heavy approach limits capital expenditures while providing steady cash flow, but it also means that brand execution relies heavily on franchisee performance.

Restaurant Brands Iconic Brands Stats from their International Segment Presentation.

Opportunity on the Menu: The Bull Case

Restaurant Brands International ranks as the third-largest quick-service restaurant operator in the world, a scale that gives it bargaining power, brand leverage, and global expansion capacity.

Strengths driving the bull case:

Global Scale & Brand Recognition – The company operates across more than 120 countries, with iconic brands recognized for decades.
Franchise Model Efficiency – With over 100% of net new openings driven by franchisees, capital intensity stays low, allowing the company to reinvest in marketing and menu development.
Growth Through Expansion & M&A – Management is targeting 40,000 restaurants by 2029, with both organic openings and acquisitions (e.g., Carrols Restaurant Group, Popeyes China) feeding the pipeline.
Turnaround Potential at Burger King – The “Reclaim the Flame” strategy is refreshing stores, improving operations, and boosting franchisee profitability.
Menu Innovation & Digital Expansion – Tim Hortons’ new product launches and loyalty programs, plus Popeyes’ global chicken sandwich success, demonstrate the ability to capture new demand.

While Tim Hortons has reasserted its leadership in Canada, the most dynamic growth story is in international markets, where Burger King and Popeyes are achieving high-single-digit unit growth annually. This geographic diversification helps smooth performance when one brand or region faces headwinds.

Risks to Chew On: The Bear Case

Even with its scale and iconic brands, Restaurant Brands International faces meaningful risks that could hinder its expansion and earnings trajectory.

Key vulnerabilities and threats:

Franchisee Profitability Pressures – Rising wages, food inflation, and operational costs can squeeze franchisee margins, leading to slower store expansion or reduced reinvestment.
Debt Load Limits Flexibility – With a net debt-to-EBITDA ratio of 4.6x at the end of 2024, high leverage could restrict strategic acquisitions or marketing investments if interest rates rise further.
Mixed Brand Performance – While Tim Hortons and Popeyes post healthy sales growth, Burger King North America continues to lag peers like McDonald’s and Wendy’s in traffic.
Global Economic Sensitivity – As a discretionary spending category, quick-service dining is vulnerable to economic slowdowns, which can trigger more discounting and hurt margins.
Competitive Heat – McDonald’s and Yum Brands have global dominance, scale advantages, and deep digital ecosystems, forcing QSR to maintain constant innovation to keep market share.

The heavy reliance on franchisees means brand quality is only as strong as local execution—something that’s difficult to maintain perfectly across thousands of locations and dozens of countries.

The Ultimate Safe List to Get Dividend Growth Stock Ideas

To help you build a solid portfolio with dividend growth stocks, I have created the Canadian Rock Stars List, showing about 300 companies with growing trends.

You can read on to understand how it is built and why it’s the ultimate list for Canadian dividend investors, or you can skip to the good stuff and enter your name and email below to get the instant download in your mailbox.

What’s New: Recent Performance Highlights

In its 2025 Q2 results (May 29, 2025), Restaurant Brands International reported:

Revenue up 21%, driven largely by acquisitions (Carrols Restaurant Group and Popeyes China).
EPS up only 3%, as higher costs and integration expenses weighed on profitability.
System-wide sales grew 2.8%, with international markets delivering 8.6% growth.
Comparable sales flat at 0.1% globally, or just over 1% adjusted for Leap Day.
Burger King North America saw a 1.3% decline in comparable sales, reflecting softer consumer demand.
Tim Hortons and Popeyes posted positive comps, benefiting from menu innovation and marketing.

The Dividend Triangle in Action: QSR’s Growth Profile

Restaurant Brands (QSR.TO) 5-year Dividend Triangle chart.

Looking at the Dividend Triangle—revenue, EPS, and dividend growth—Restaurant Brands International shows a consistent uptrend in the top line and dividends, but EPS volatility is a watch point.

Revenue has risen steadily to $12.19B over the past three years, fueled by expansion and acquisitions.
EPS has grown over time but faced a dip in 2025 due to cost pressures and integration expenses.
Dividend has increased consistently, now at $0.852 per quarter, showing management’s commitment to rewarding shareholders.

The dividend growth case here leans on long-term expansion and scale efficiencies rather than near-term earnings acceleration.

The Dividend Rock Stars List: The ONLY List Using the Dividend Triangle

The dividend triangle is an exclusive concept developed at Dividend Stocks Rock (DSR).

While many seasoned investors use these metrics in their analysis, no one has created a list based on them before.

Don’t waste any more time with complex strategies and dozens of metrics duplicating each other: focus on quality and download the list with filters now.

Final Bite: A Brand Empire Built for the Long Term

Restaurant Brands International combines brand power, a scalable franchise model, and aggressive global expansion ambitions. While short-term headwinds—particularly in Burger King North America and from higher operating costs—are real, its multi-brand, multi-market portfolio offers resilience and multiple growth levers. For dividend growth investors, the appeal lies in a management team committed to steady dividend hikes, backed by a cash-generating model that doesn’t require heavy capital investment.

Printing Results, Not Just Labels

This Canadian company is a global heavyweight when it comes to labels, packaging, and tracking tech. From shampoo bottles to RFID tags, it has its fingerprints on thousands of everyday products — and it keeps showing up with results.

It just posted a strong quarter (revenue and EPS up 9%) and remains off most investors’ radars. But behind the scenes, this business has been compounding steadily with a blend of smart acquisitions, global diversification, and consistent dividend growth.

Let’s peel back the label and take a proper look at what’s underneath.

Business Model: Labeling the World

CCL Industries is a global leader in specialty label and packaging solutions with operations in 42 countries. It operates across four key segments:

CCL (labels and containers for consumer and healthcare goods)
Avery (printable media and office products)
Checkpoint (RF/RFID tech for retail security and tracking)
Innovia (specialty multilayer films and polymer banknotes)

The company earns revenue from long-term contracts, recurring customer orders, and broad exposure to industries like consumer staples, pharma, logistics, and retail.

Their combination of essential products and global reach makes the business resilient, even when headlines scream recession.

CCL Industries (CCL.B.TO) Highlights from Its 2024 Annual Report.

Investment Thesis: Diversified and Disciplined

CCL Industries doesn’t depend on a single market, product, or trend. That’s part of the appeal. It combines consistent organic growth with smart, bolt-on acquisitions. The company’s 2013 acquisition of Avery, followed by Innovia and Checkpoint, helped reshape its business into a multi-pronged revenue machine.

Even in a cost-sensitive world, labeling and packaging remain critical — and CCL keeps adding value through higher-margin segments like RFID, polymer banknotes, and specialty films.

It’s also one of those rare businesses in the material sector that behaves more like a compounder: efficient operations, strong ROE, and a steady dividend growth history.

The Ultimate Safe List to Get Dividend Growth Stock Ideas

To help you build a solid portfolio with dividend growth stocks, I have created the Canadian Rock Stars List, showing about 300 companies with growing trends.

Bull Case: Labeling Growth Across the Globe

CCL is a well-managed, acquisition-savvy company with a habit of integrating well and producing solid results. The latest quarter showed strong momentum in core segments, especially:

Organic growth of 3.8%
Strong demand in home & personal care
Growth in Europe, Mexico, and the Americas
Positive currency impact and margin stability

The company also announced a share buyback of 8.82% of issued capital, which is a strong vote of confidence from management.

Its global scale, product diversification, and recurring cash flow make it a stable performer in volatile markets.

Bear Case: Margin Pressures & Acquisition Risks

Of course, nothing is perfect.

CCL is still part of the materials sector, which means it’s exposed to raw material price swings. As inflation and logistics costs rise, so do the risks to margins — and there’s only so much pricing power before customers push back.

It also relies heavily on acquisitions for growth. While past deals have been smart, no streak lasts forever. And restructuring costs in Checkpoint ($0.8M) serve as a reminder that not every unit is a smooth operator.

The Dividend Triangle in Action

CCL Industries (CCL.B.TO) 5-Year Dividend Triangle.

Let’s see how CCL performs on our three-part Dividend Triangle:

Revenue: Consistent upward trend, now at $7.4B
EPS: Solid long-term growth, with a strong Q1 rebound
Dividend: Slowly and steadily increasing — with a low payout ratio

While the yield remains modest (~0.4%), it’s growing, and CCL has plenty of room to accelerate it down the line.

Latest Results Recap

On May 26, 2025, CCL Industries reported:

Revenue up 9%
EPS up 9%
Strong organic growth in Home & Personal Care
Innovia performed well; Checkpoint faced $0.8M in severance-related costs
Announced share buyback for up to 8.82% of capital

It was a very solid quarter overall — no surprises, just execution.

The Dividend Rock Stars List: The ONLY List Using the Dividend Triangle

The dividend triangle is an exclusive concept developed at Dividend Stocks Rock (DSR).

While many seasoned investors use these metrics in their analysis, no one has created a list based on them before.

Don’t waste any more time with complex strategies and dozens of metrics duplicating each other: focus on quality and download the list with filters now.

Final Word: Built to Scale and Last

This stock does grab results. Over the years, it’s turned packaging and labeling into a high-margin, global business, driven by innovation, disciplined acquisitions, and rock-solid execution.

It may not offer a sky-high yield, but it delivers where it counts: steady growth, strong cash flow, and the kind of business that keeps performing across market cycles.

If you’re looking to anchor your dividend portfolio with quality names that can weather economic cycles, CCL.B.TO is one to watch.

How Have I Never Posted This Before?

How is it possible that I keep talking about this store… but never shared a full, public analysis of it?

If you’ve followed me for a while, you already know I’m a big fan of this one. Some companies make headlines. Others make results. Couche-Tard (ATD.TO) does both. Whether it’s Circle K on a road trip or a late-night Couche-Tard pit stop, this company is everywhere — and still expanding.

Between fuel, snacks, coffee, and now EV charging, this business is evolving fast. It’s not a high-yielder, but it’s consistent, resilient, and cash flow rich. So yes — it’s about time we break it down properly.

Business Model: Fuel, Coffee, and Convenience at Global Scale

ATD is one of the largest convenience store operators in the world. With more than 17,000 stores across 29 countries, it operates primarily under the Couche-Tard and Circle K banners. Roughly 13,000 of those stores also sell road transportation fuel.

The company generates revenue from:

Fuel sales (still the most significant slice)
In-store merchandise (snacks, drinks, convenience goods)
Food service (prepared foods, coffee, fresh grab-and-go)
Service offerings like car washes, ATM fees, and mobile payment partnerships

Its North American operations are structured into 17 business units and it has deep market penetration in Canada, the U.S., and Northern Europe. The company is currently focused on strengthening its margins and customer experience through its 10 for the Win strategic plan, aiming to exceed $10 billion in EBITDA by 2028.

Alimentation Couche-Tard (ATD.TO) Global Retailer Highlights from its Q4-FY2025 Investor Presentation.

Investment Thesis: The Steady Compounder that Never Stops Moving

Couche-Tard is one of those businesses that feels boring… until you look at the numbers.

The company has built a long-term track record of revenue, EPS, and dividend growth through steady execution and smart acquisitions. It’s rare to find a company that consistently integrates new stores and finds ways to unlock margin — but ATD has done it for years.

While the market worries about declining fuel consumption and cigarette sales, Couche-Tard is already pivoting — expanding fresh food offerings, testing EV charging stations, and rolling out smart loyalty programs to drive in-store traffic.

Its scale advantage allows for pricing power, while its operational playbook enables new acquisitions to become accretive faster than most peers. The company generates serious free cash flow and operates with discipline — which is why it has quietly become one of the most efficient operators in retail.

It’s not immune to headwinds, but it adapts. And in a recession? This business gets even more interesting.

The Dividend Triangle in Action

Alimentation Couche-tard (ATD.TO) 5-Year Dividend Triangle.

Let’s put Couche-Tard through the Dividend Triangle:

Revenue Growth: Over $100B in trailing twelve-month revenue, up from ~$85B just a few years ago. The business continues to expand both organically and through acquisitions.
EPS Growth: Normalized EPS is hovering near all-time highs ($3.70 TTM), showing the business continues to scale and manage costs effectively — even as fuel margins fluctuate.
Dividend Growth: Still a very low yield (under 0.3%), but the company has increased its dividend annually with a solid CAGR. Payout ratio remains extremely low (~5%), leaving plenty of room for future hikes.

This is a classic low-yield, high-growth name and fits the long-term compounding strategy like a glove.

Bull Case: Built to Scale, and Still Growing

Couche-Tard has proven over the decades that it can scale, integrate, and execute across borders. Its dominance in the convenience store space is the result of:

Smart, disciplined M&A
Margin expansion through cost synergies
Adapting to consumer trends (e.g., food, loyalty, digital)

It has the balance sheet and operational know-how to weather changing trends (EVs, tobacco decline) and shift its model accordingly. And with its 10 for the Win plan in place, management has a clear roadmap to create shareholder value.

Bear Case: Fuel Reliance & Acquisition Risk

Despite its strengths, Couche-Tard isn’t without risks:

Fuel remains a key profit driver — any long-term demand drop will pressure margins
Cigarette sales, a high-margin category, are in secular decline
The company’s reliance on acquisitions means missteps (like the failed Carrefour deal) could be costly
Food service expansion brings Couche-Tard into competition with grocery chains and QSRs — not easy battlegrounds

In short, execution must remain tight. This isn’t the time for acquisition blunders or weak integration.

Latest Results: A Slower Quarter(s), but Strategy Intact

Q1 FY2026 Earnings (June 26, 2025)

Revenue: Down 7.5% (fuel price/demand weakness)
EPS: Down 4.2%
Merchandise Revenue: Up 2.4% (led by Canada & Europe)
Operating Expenses: Up, due to strategic investments
Fuel Gross Margin: Improved, softening the impact of the revenue drop
M&A Activity: No update on the potential 7-Eleven acquisition

While the numbers were soft, the long-term thesis remains. The company is investing to reposition its business — and short-term pain may unlock future gain.

Final Word: Simple. Strong. Still Compounding.

Couche‑Tard just posted a softer quarter: revenue fell 7.5%, EPS dipped 4%, and growth in fuel sales took a breather. But dig deeper, and you’ll see why it still matters.

Merchandise and service revenue is growing. They’re investing intentionally — stepping up fresh food, EV charging, and loyalty tools. The business is evolving, not collapsing.

Look, I’m not here for flash. I’m here for resiliency, adaptability, and cash flow. And despite a bump in the road, Couche‑Tard remains all three. That’s exactly why I’m comfortable rolling the cash into this full position: it’s a compounder, even when it’s slow.

Remember to review all of your holdings quarterly, though.

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Why I Keep Watching This Underdog Bank

It’s not flashy, it doesn’t have thousands of branches, and it definitely doesn’t get the media attention of Canada’s Big 6. But this bank has quietly built a niche in one of the most profitable corners of the financial sector — and it keeps delivering.

EQB Inc. (EQ Bank) blends digital efficiency with high-margin lending, and while the road isn’t always smooth, it continues to grow, raise its dividend, and find ways to outmaneuver bigger competitors. That’s exactly why I keep watching.

Business Model: Digital-First, Credit-Focused

EQB is a challenger bank that’s carved out its niche by focusing on alternative-A mortgage lending, commercial real estate loans, and a 100% digital banking platform. Through EQ Bank, it offers high-interest savings accounts, GICs, and personal lending products — all without branches.

On the commercial side, it’s expanded into equipment leasing, multi-unit residential financing, and business lending through strategic fintech and credit union partnerships. The result? A growing loan book, solid margins, and a nationwide customer base that now tops 560,000.

Unlike traditional banks, EQB lends to self-employed individuals, newcomers, and businesses that don’t always check all the Big Bank boxes. That adds risk — but also reward.

Equitable Bank Overview from the Covered Bond Invetsor Presentation. — Equitable Bank Overview from the Covered Bond Investor Presentation.

Investment Thesis: The Right Niche, The Right Time

EQB has done an impressive job turning its smaller size into an advantage. Its fully digital platform means lower costs, faster innovation, and no legacy branch network dragging it down. Instead, it focuses on tech-enabled growth: direct-to-consumer banking, alternative mortgage lending, and commercial finance.

What sets EQB apart is its ability to serve customers that others overlook — and do it profitably. Its net interest margins are among the highest in the industry, thanks to higher-yielding loans and a more agile model.

Yes, it’s not immune to credit cycles. But this is a stock that’s grown steadily over the past five years, raised its dividend regularly, and delivered a solid return for investors willing to go beyond the Big 6. That makes it a name worth watching — or holding.

The Dividend Triangle in Action: Growth with a Side of Volatility

Equitable Group (EQB.TO) 5-Year Dividend Triangle.

Let’s run EQB through the Dividend Triangle and see if it still checks the right boxes despite a bumpy quarter.

1. Revenue Growth: Revenue stands at $1.279B, nearly doubling over the past few years as EQB expanded its loan book and deposit base.

2. Earnings Growth: EPS currently sits at $10.03, though it’s dipped due to higher provisions for credit losses (PCLs). Long term, the trend remains positive despite short-term volatility.

3. Dividend Growth: The dividend now stands at $0.53, up again by 4% last quarter. That’s steady growth for a company reinvesting heavily while still rewarding shareholders.

Summary: EQB passes the Dividend Triangle test — even if earnings hit speed bumps, its top line and dividend trend continue to move in the right direction.

The ONLY List Using the Dividend Triangle

After this first example, you may wonder how I was able to differentiate these positions.

I analyze companies according to their dividend triangle (revenue, earnings, and dividend growth trends), combined with their business model and growth vectors. While this may seem too simple, two decades of investing have shown me it is reliable.

While many seasoned investors also use these metrics in their analysis, no one has created a list based on them before. This is exactly why I created The Dividend Rock Stars List.

The Rock Stars List isn’t just about yield—it’s built using a multi-step screening process to ensure the highest-quality dividend stocks. You can read more about it or enter your name and email below to get the instant download in your mailbox.

Bull Case: Undervalued and Underappreciated

EQB might not get the spotlight like the Big Banks, but its fundamentals are compelling:

Higher NIMs and lower costs thanks to its digital-first model
Niche mortgage lending to underserved segments = stronger yields
Commercial finance growth = new profit centers
Fintech partnerships & open banking readiness position EQB well for the future
Consistent dividend hikes + long-term loan growth

It’s lean, focused, and still has room to scale — especially outside the Big Bank footprint.

Bear Case: Credit Risk and Rate Sensitivity

Still, this isn’t a stock for the risk-averse:

Rising PCLs (up 36% last quarter) show pressure in equipment & commercial lending
EPS dropped 17%, reminding us that loan quality can shift quickly
Sensitive to interest rate changes and tighter regulations
Commercial loan exposure could drag returns if the economy slows
Not “too big to fail” — lacks the stability of Big 6 peers

It’s a bank that works well in calm markets — but needs careful monitoring when the environment gets rocky.

Latest News: Soft Quarter, but the Growth Continues

EQB’s most recent quarter was mixed:

Revenue flat | EPS -17%
Net interest income +1% | NIM 2.20%
EQ Bank customers +23% (to 560K)
Higher impaired loans + two commercial accounts added risk
Dividend increased 4% — again!

Even with some weakness, EQB’s management remains confident — and the long-term growth path is still intact.

Want to See My Full Breakdown?

If you want to hear more about why I’m keeping EQB on my radar — especially after a soft quarter — I’ve got you covered.

Watch the full EQ Bank analysis on YouTube:

In the video, I break down:

What’s driving EQB’s growth
What worries me about recent results
Where I see an opportunity going forward

Final Word: Lean, Digital, and Worth the Risk (for the Right Investor)

EQB isn’t for everyone. It doesn’t have the brand recognition or the scale of Canada’s Big 6. But that’s the point.

It’s leaner, faster, and focused on segments that others ignore — and it’s done a great job turning that into long-term growth. With a strong Dividend Triangle, regular dividend hikes, and a clear digital vision, EQB is the kind of stock that can reward patient investors willing to go off the beaten path.

Just be ready to hold on through the bumps.

Initiating a Full Position in This Amazing Stock

I’ve had my eye on this one for a while — first adding it to my Smith Manoeuvre portfolio as a defensive play in case of a recession. Funny enough, the recession never came… but the stock still delivered.

What drew me in wasn’t just its resilience — it was the consistency. Quarter after quarter, this company executes. It’s not flashy, and the dividend won’t knock your socks off, but the fundamentals? Rock solid.

With a perfect dividend triangle and more room to grow through its Latin American expansion (and now Australia!), I’ve decided it’s time to go all in. I’m using all available cash in my pension account this month to build it into a full position.

Let me be clear: I don’t want small, forgettable holdings. If I take the time to research and monitor a stock, it needs to matter in my portfolio. This one earns that spot.

Business Model: Discount Done Right

This isn’t just a dollar store chain — it’s a value-focused retail machine.

With 1,600+ stores across Canada, Dollarama (DOL.TO) sells low-cost, high-turnover merchandise across general goods, food, and seasonal items. Most products are under $5 (soon going up to $6), and nearly 60% are private label, giving it better margins and pricing control.

It also owns a majority stake in Dollarcity, a fast-growing Latin American chain with 600+ stores across Colombia, Guatemala, El Salvador, and Peru. Together, they deliver value to cost-conscious shoppers — and strong returns to investors.

Dollarama geographic presence as at the first quarter ended May 4, 2025 (Q1-FY26).

Investment Thesis: Consistency that Compounds

This company thrives because it keeps things simple: offer everyday essentials at fixed low prices, run tight operations, and grow methodically. That formula has worked across Canada — and now it’s gaining traction internationally through Dollarcity and its pending acquisition of The Reject Shop in Australia.

What makes it a standout is the consistency. It continues to grow revenue and earnings through store openings, disciplined cost control, and steady foot traffic — even in a tough economic environment. At the same time, its high private-label mix and fixed pricing model help maintain healthy margins while giving shoppers predictability.

It’s also preparing for long-term growth. With a new distribution center in Calgary, expansion plans into Mexico, and higher price tiers on the horizon, the company is building the foundation for even more scale. Combine that with its performance during inflationary periods and its strong execution quarter after quarter, and you have a business built for both offense and defense.

This may not be the flashiest stock — but it’s the kind of compounder you’ll be glad you held onto.

The Dividend Triangle in Action: Steady as it Goes

Dollarama (DOL.TO) 5-Year Dividend Triangle.

Let’s break it down by the three Dividend Triangle pillars:

1. Revenue Growth: Revenue hit $6.53B, up 8% year-over-year, driven by 69 net new stores and strong same-store sales.

2. Earnings Growth: EPS climbed to $4.34, up 27% — a result of stronger margins and increased customer transactions.

3. Dividend Growth: The dividend has grown slowly to $0.106, reflecting a conservative payout strategy. It’s not an income play today, but the consistent growth signals stability.

Summary: Dollarama nails the dividend triangle with smooth, upward trends across revenue, earnings, and dividends.

Bull Case: Defensive, Disciplined and Growing Globally

There’s a lot to like for long-term investors:

Dominant position in Canadian value retail
60%+ of sales from private-label = strong margins
International growth through Dollarcity and upcoming expansion into Mexico and Australia
$450M investment in Western Canadian distribution = future scale
Resilient even in inflationary or recessionary environments

Bear Case: Margins Could Be Pressured as It Grows

Even with a strong moat, there are some risks:

High exposure to imports = FX, tariffs, and shipping disruption risks
Canadian market could approach saturation
Competitive pressure from Walmart, Amazon, and e-commerce
International expansion adds political/economic risk (especially in Latin America)

Still, DOL’s execution track record has been solid — and the moat is wider than most think.

Latest News: New Markets, Bigger Margins

Dollarama’s most recent quarter was another beat:

Revenue +8% | EPS +27%
69 new stores (now at 1,638)
Comparable sales +4.9%
Plans to enter Mexico soon
Acquisition of The Reject Shop in Australia expected to close in July

Management reaffirmed its full-year targets and continues to deliver quarter after quarter.

Want More Stocks Like This?

We track more than yield. The Dividend Rock Star List includes Canadian and U.S. stocks that hit all the right metrics — even when yield is low.

Here’s what’s inside:

Filter by revenue, EPS, and dividend growth
Screen for quality with payout ratio, sector, and more
Updated monthly so you’re always working with fresh data
Great for building long-term portfolios focused on dividend resilience

Start browsing the Dividend Rock Star List now and find your next winner before everyone else does.

Final Word: Make Every Holding Count

This isn’t just about filling space in a portfolio — it’s about owning companies that matter.

Dollarama continues to perform across all fronts: growth, margins, international expansion, and shareholder returns. While the dividend is small, the compounding machine behind it is strong.

There aren’t many names on the TSX that combine operational discipline, international growth, and defensive qualities like this one.

Dollarama remains one of the best Canadian stocks on the market — and building a full position just makes sense for me.

All the Traits of a Dividend Star… Without the Dividend

Some companies scream “dividend grower” — stable revenue, rising earnings, mountains of cash flow — and yet, they barely pay a cent. One Canadian tech giant has delivered monster returns without ever becoming a traditional dividend payer. Instead of chasing yield and dividend payments, it reinvests cash into an aggressive, proven acquisition engine that keeps shareholders happy through capital gains, not distributions.

If you’re willing to make an exception for ultra-low yield in exchange for serious long-term wealth creation, this one might change how you define “dividend investing.”

Business Model: Buying, Holding, and Growing Software Niches

Constellation Software (CSU.TO) doesn’t build flashy apps or compete in crowded software categories. Instead, it acquires mission-critical software companies serving niche industries — often the kind of businesses no one’s ever heard of… except their loyal customers.

CSU acts like a holding company for vertical market software (VMS). It targets stable, low-churn software businesses with substantial recurring revenue, then lets them run independently with support from the parent. This decentralized model keeps local talent in place while improving capital discipline and operations.

Through six operating groups — Volaris, Harris, Topicus, Vela, Jonas, and Perseus — CSU now serves over 100 markets globally, spanning utility billing, health records, and marina management. The result? Low customer churn, sticky cash flows, and consistent margins — all without relying on a single industry.

Investment Thesis: Why Dividend Investors Should Still Care

At first glance, CSU doesn’t belong in a dividend portfolio. Its yield is barely noticeable, and it hasn’t raised its dividend in years. But dig deeper, and you’ll find a stock with all the hallmarks of a dividend growth engine — just without the dividend.

Revenue, EPS, and free cash flow all rise steadily thanks to one thing: disciplined acquisitions. CSU buys small, stable, and boring software companies at fair prices, then lets them thrive. Its decentralized playbook and capital discipline allow it to scale this model across dozens of verticals.

With low debt, high returns on capital, and a management team focused on long-term wealth creation, CSU continues to grow shareholder value — even if it keeps the cash in-house. For investors who prioritize compounding over current income, this is a name worth watching.

The Dividend Triangle in Action: Strong Fundamentals, Minimal Yield

Constellation Software (CSU.TO) 5-Year Dividend Triangle.

Despite its low payout, CSU checks all three boxes of the Dividend Triangle:

1. Revenue Growth: TTM revenue now sits at $14.41B, with a steady climb year after year. Q1 2025 revenue rose 13%, fueled by acquisitions and minor organic growth.

2. Earnings Growth: EPS reached $49.50, a 10% YoY increase. CSU continues to drive profit growth through smart integrations and operating efficiency.

3. Dividend Growth: This is where CSU “fails” the test. The dividend is stuck at $1.36, with no growth in sight — but that’s by design. With better uses for cash, management chooses to reinvest in new deals that generate higher long-term returns.

In short: this is a textbook Dividend Triangle stock — minus the dividend growth.

Bull Case: Serial Acquirer, Proven Playbook

For investors who don’t need yield today, CSU is a compounding machine with plenty to like:

Proven decentralized structure that scales across 100+ industries
Strong revenue, EPS, and cash flow growth — even in tough markets
Low debt, with $1.8B spent on acquisitions last year alone
Consistent history of finding, buying, and growing niche software companies
Organic growth may be small, but the acquisition pipeline is always full

Bear Case: All In on Acquisitions

Still, there are real risks to watch:

Growth depends on continuous deal flow. Slowdown = valuation hit
Acquisition multiples could rise as private equity and competitors enter the space
Complex structure makes it hard to track individual performance
Any stumble in capital allocation could rattle investor confidence
Sky-high valuation = little room for error

This stock is priced for execution. If the M&A engine stalls, so could the returns.

Latest News: Growth on Track, Expectations Higher

CSU’s most recent quarter showed solid results — but didn’t quite wow the market:

Revenue +13% | EPS +10%
Organic growth flat at 0.3% (2% with currency)
Free cash flow +14%
Acquired a significant stake in Asseco Poland S.A., expanding its global reach

Bottom line: growth continues, but with expectations so high, CSU needs to maintain a near-flawless execution pace.

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Final Word: All the Fundamentals, None of the Yield

Constellation Software isn’t for every dividend investor — and that’s okay. But if you’re willing to make a strategic exception, you’ll find a stock that does everything we want from a dividend grower… except pay one.

With decades of growth-by-acquisition success, low debt, high margins, and world-class capital allocation, CSU offers a blueprint for compounders. No fluff. No gimmicks. Just consistent, disciplined execution in a market that rewards it.

If you can live without the yield, this one might be worth the hold.