TSI’s Scott Clayton has identified six exceptional dividend stocks whose fundamental strength remains intact despite significant share price declines driven by tax-loss selling pressure. As the latest analysis shows, the year-end rush to harvest losses often creates compelling opportunities for disciplined investors willing to buy quality assets when others are forced sellers.
These resilient companies span key sectors of the North American economy. Whether it’s Canada’s largest railway operator, a leading wireless communications provider, a specialized information powerhouse, a major packaged foods producer, a global medical equipment maker, or a diversified property and home-services group, each represents an established, cash-generating business with solid long-term prospects.
The screening process began with dividend-paying stocks and then zeroed in on those most heavily pressured by tax-loss selling while still maintaining promising outlooks supported by leading market positions. By targeting the disconnect between short-term tax-driven selling and long-term business value, the analysis isolates candidates that combine attractive entry prices with above-average dividend dependability.
TSI’s Dividend Sustainability Rating System evaluates each company on critical factors: continuous dividend payment history (with additional points for longer streaks and recent increases), management’s demonstrated commitment to shareholder payouts, operations in non-cyclical or relatively stable industries, limited exposure to currency swings and political interference, strong balance sheets with manageable debt and adequate cash, multi-year records of earnings and cash flow sufficient to cover dividends, and leading industry positions that create durable competitive advantages.
Excerpt from theglobeandmail.com, December 4, 2025
Prime stock picks for new buying – despite their appeal as candidates for tax-loss selling!
The lure of cutting taxes can spur investors to make costly mistakes. Chief among them – especially at this time of year – is the urge to dump high-quality stocks that have fallen. Their goal is to declare a tax loss in order to offset a tax gain. Still, that mistake by others often translates into a bargain for investors willing to buy stocks well positioned for a rebound in the New Year.
In fact, as our analysts at The Successful Investor point out, some of the lowest-risk, highest-profit investments you’ll ever make come from buying a good stock when other investors were ignoring its value and selling it.
We started this search with an extensive list of dividend-paying stocks, before singling out those further battered by tax-loss selling. (Note: this year’s deadline is Tuesday, December 30, 2025.) They otherwise have promising outlooks bolstered by leading market positions. Our system awards points to a stock based on key factors:
- One point for five years of continuous dividend payments
- Two points for more than five
- Two points if it has raised the payment in the past five years
- One point for management’s commitment to dividends
- One point for operating in non-cyclical industries
- One point for limited exposure to foreign currency rates and freedom from political interference
- Two points for a strong balance sheet, including manageable debt and adequate cash
- Two points for a long-term record of positive earnings and cash flow sufficient to cover dividend payments
- One point for an industry leader
Companies with 10 to 12 points have the most secure dividends, or the highest sustainability. Those with seven to nine points have above average sustainability; average sustainability, four to six points; and below average sustainability, one to three points.
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6 quality names now battered by year-end tax selling
Montreal-based Canadian National Railway Co. (with a 2.7% yield) operates Canada’s largest railway. The stock is down 10.2% from its January 2025 high.
Telus Corp. (9.2%), based in Vancouver, is Canada’s largest wireless carrier. It also sells landline phone, Internet, TV, and security services in B.C., Alberta and eastern Quebec. The shares are down 20.0% from their March 2025 high.
Thomson Reuters Corp. (1.8%), based in Toronto, sells specialized information (mainly through electronic channels) to professionals in the legal, and tax and accounting fields. It also owns the Reuters news service. The stock is down 13.4% from its July 2025 high.
Chicago-based Conagra Brands Inc. (7.9%) makes a variety of popular foods, including Chef Boyardee canned pasta, Hunt’s tomato sauce, Orville Redenbacher popcorn and Reddi-wip whipped cream. The shares are down 38.2% from their January 2025 high.
Becton, Dickinson & Co. (2.2%), headquartered in New Jersey, is a medical device maker operating through three segments. The stock is down 22.3% from its January 2025 high.
FirstService Corp. (0.7%), based in Toronto, has two main businesses: FirstService Residential, which provides an array of property management services, and FirstService Brands, which includes Paul Davis Restoration, CertaPro Painters and California Closets. The company’s shares are down 25.2% from their recent September 2025 high.
Scott Clayton, MBA, is senior analyst for TSI Network and associate editor of TSI Dividend Advisor.
