Who says you can’t have both passive income (from dividends and distributions) alongside a fairly solid growth profile that can lead to capital appreciation (think share price gains) and, perhaps most underrated of all, dividend growth.
Either way, there are many ways that investors can have their cake and eat it, too, especially as volatility becomes the name of the game as investors navigate the early innings of 2026. I’d argue that volatility works in favour of brand-new investors who are looking to build a portfolio slowly and steadily over time. More pain in markets means better prices to pick up from the rubble with every biweekly paycheque.
In any case, this piece is going to focus on two names that I think are starting to look like the best of both worlds. Whether you’re a growth-focused investor who wouldn’t mind the “nice-to-have” of a nice income boost at the end of every quarter or you want to strive for the perfect balance, the following names are definitely worth keeping on a shopping list, especially if the soaring macro tensions cause a full-blown market correction or maybe something a bit worse.
Of course, this isn’t to scare you. Rather, it’s to get you, as a long-term investor, better conditioned for the turbulent periods. Investing isn’t all fun and excitement all the time. Every three years or so, you should expect a storm to hit and for the value of your portfolio to keep marching steadily lower.
The key is to look to position your Tax-Free Savings Account (or any other account) to fall less than the markets, especially if you’re looking at the dividend-paying growth companies. At the end of the day, hyper-growth stocks aren’t for everyone. Sometimes, it’s cash dividends that make all the difference. And in this piece, we’ll look at premier dividend growers that I consider to be interesting for those looking to go down the income-growth hybrid route.
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TD Bank
TD Bank (TSX:TD) and the rest of the Big Six Canadian banks look to have finally run out of steam. And while the latest 5% dip might seem like a warning signal before a more severe decline, I’d argue that timing the recent action makes very little sense, especially for new investors who should be focusing on the next 10 years, rather than the next couple of days, weeks, or even months. To put it simply, TD Bank stock looks cheap, at least in my opinion, right here and now at 10.4 times trailing price to earnings.
With a refreshed brand, smart tech bets, and a new CEO, Raymond Chun, who I believe has done far better than expected, especially in his first few quarters as top boss, I see no reason (perhaps other than fear of more pain and losses) to keep waiting. The stock’s 3.34% yield has become small, but it’s still bountiful, especially if the bank’s loan growth days are still in their early days. With the modest valuation and underestimated potential for tech-driven (think AI) margin gains, I view TD Bank as perhaps one of the best and cheapest dividend growers as we head into the second quarter of 2026.
In short, the yield might be lower for TD, but the main reason to own is for the dividend growth and capital gains prospects over the long term.
