We recently published a list of the 20 Best Dividend Growth Stocks with High Yields. In this article, we are going to take a look at where Canadian Natural Resources Limited (NYSE:CNQ) stands against other best dividend growth stocks.
Dividend-paying stocks have been gaining popularity among investors due to their long-term advantages. According to Jeremy Zirin, who leads the US equity team for private clients at UBS Asset Management, companies with a consistent track record of increasing dividends are a smart choice for investors seeking a balanced approach in the current market environment. When markets dipped in April after President Donald Trump announced new tariff policies, investors gravitated toward high-yield dividend stocks. However, as trade tensions began to ease and negotiations progressed, markets recovered. Stocks surged particularly after the US and China agreed to temporarily reduce tariffs. He made the following comment about dividend stocks:
“The higher-dividend-yielding strategies tend to do better when markets are in real turmoil and declining, but if there’s more chop, more volatility and potentially upside … you don’t want to be overly defensive.”
Historically, companies that consistently increase their dividends have tended to be less volatile and often delivered stronger returns than the broader market, including benchmarks like the S&P Equal Weight Index. According to a report by Guggenheim, from May 2005 through December 2024, firms that either initiated or raised their dividends generated an average annual return of 10.5%. In contrast, companies that cut or suspended their payouts posted just 5.5% annually. The overall market returned 10.4% during this timeframe, slightly behind the dividend growers. The report also highlighted that dividend growth strategies have historically performed well in both rising and falling markets, making them an attractive option for investors focused on long-term gains and downside protection.
According to a report by S&P Global, the growth of global dividend payments had been slowing since the post-COVID recovery, but that trend reversed last year. In 2024, the growth rate unexpectedly accelerated to 8%, with shareholders receiving approximately $180 billion more than the previous year. This increase came as a surprise given the persistent geopolitical and economic challenges. The report also highlighted that several sectors and regions saw record dividend initiations, including the US technology, media, and telecom (TMT) sector, banks in Italy and Spain, Japan’s automotive industry, and a general rise in payouts from Mainland China. Even with extreme price fluctuations, dividend payments from the oil and gas sector remained strong. Looking ahead, the report suggested that this high level of dividends is likely to hold steady, with global payouts expected to remain at $2.3 trillion in 2025.
With growing investor appetite for dividend-paying stocks, many companies have responded by gradually increasing their dividend payouts. A report by Janus Henderson revealed that global dividend payments reached a record $1.75 trillion in 2024, reflecting a 6.6% rise on an underlying basis. The overall growth rate came in at 5.2%, slightly held back by a drop in special one-time dividends and the effect of a stronger U.S. dollar. Out of the 49 countries covered in the report, 17—including major economies such as the US, Canada, France, Japan, and China—posted record-high dividend levels. In total, 88% of companies either raised or held their dividends steady over the year.
A vast oil rig pumping crude oil during a sunset, emphasizing the company’s focus on oil & gas exploration and production.
Our Methodology
For this list, we screened for dividend stocks with yields higher than 3% as of May 13. From this group, we further refined our selection criteria by identifying stocks with a dividend growth streak of 10 years or more. The stocks are ranked in ascending order of their dividend yields.
At Insider Monkey, we are obsessed with hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Canadian Natural Resources Limited (NYSE:CNQ)
Dividend Yield as of May 13: 5.53%
Canadian Natural Resources Limited (NYSE:CNQ) is a major crude oil and natural gas producer, with active operations across several core areas such as Western Canada, the UK North Sea, and offshore regions in Africa. The company’s broad and varied asset base has helped it maintain strong performance even amid fluctuating commodity prices.
As the sole or majority owner of most of its projects, Canadian Natural Resources Limited (NYSE:CNQ) benefits from the ability to reallocate capital efficiently across its portfolio to capitalize on favorable market conditions. The company also maintains a solid balance sheet, and its scale provides the financial strength to pursue major strategic acquisitions when opportunities emerge during downturns in the energy industry.
In the first quarter of 2025, Canadian Natural Resources Limited (NYSE:CNQ) posted revenue of $47.6 billion, down 2.2% from the same period last year. The revenue also missed analysts’ estimates by $783.3 million. The company reported record production levels, reaching about 1,582,000 barrels of oil equivalent per day. This included a record 1,174,000 barrels per day of liquids, with 79% coming from long-life, low-decline assets, along with record natural gas production of 2,451 million cubic feet per day.
Canadian Natural Resources Limited (NYSE:CNQ)’s cash position remained strong with an operating cash flow of $4.3 billion, up from $2.8 billion in the prior-year period. Year-to-date, the company returned $2.4 billion through dividends. Currently, it offers a quarterly dividend of C$0.5875 per share and has a dividend yield of 5.53%, as of May 13. It has been growing its payouts for 25 consecutive years, which makes CNQ one of the best dividend stocks on our list.
Overall, CNQ ranks 8th on our list of the best dividend growth stocks with high yields. While we acknowledge the potential of CNQ as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for a deeply undervalued dividend stock that is more promising than CNQ but that trades at 10 times its earnings and grows its earnings at double digit rates annually, check out our report about the dirt cheap dividend stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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