Many investors overlook small-cap stocks because they typically carry higher risk than larger companies. These two, however, are industry leaders, and their recent moves should generate more cash to reward shareholders.

SOUTH BOW CORP. $38 is a hold. The company (Toronto symbol SOBO; Income-Growth Dividend Payer Portfolio; Utilities sector; Shares outstanding: 208.2 million; Market cap: $7.9 billion; Dividend yield: 7.1%; Dividend Sustainability Rating: Above Average; www.southbow.com) took its current form on October 1, 2024, when TC Energy (see page 18)spun off its oil pipeline business. Investors received 0.2 of a South Bow share for every TC share they held at that time.

This new firm operates a 4,900-kilometre pipeline network that pumps crude oil from Alberta to refineries in the U.S. It pays a quarterly dividend of $0.50 U.S. a share. The annual rate of $2.00 U.S. yields a high 7.1%.

Both of these renewable energy providers are expanding and upgrading their assets. That should increase their cash flow and, ultimately, boost their already attractive dividend yields.

PURPOSE CORE DIVIDEND FUND ETF $39 (Toronto symbol PDF; Units outstanding: 9.7 million; Market cap: $378.3 billion; Divd. yield: 3.3%; www.purposeinvest.com) holds U.S. and Canadian stocks that its managers view as ready to maintain or increase their dividends.

The ETF yields an appealing 3.3%.

The fund holds mostly high-quality companies, including Pembina Pipeline, Agnico Eagle Mines, CIBC, TC Energy, TD Bank, Enbridge, Manulife Financial and Scotiabank.

Pembina Pipeline, AbbVie and Choice Properties REIT are our top picks for 2026. Each has a long history of regular dividend increases—a sign of income quality and longevity. Each also has an attractive price-to-earnings or price-to-cash flow ratio. That further cuts your risk.

A: Denison Mines Corp., $5.25, symbol DML on Toronto (Shares outstanding: 897.3 million; Market cap: $4.6 billion; www.denisonmines.com), is a Canadian uranium exploration and development company focused on the Athabasca region of northern Saskatchewan.


The Athabasca basin is home to the world’s largest and highest-grade uranium mining and milling operations. They include the McArthur River and Cigar Lake uranium mines, as well as the Key Lake and McClean Lake uranium mills.

A: iShares S&P/TSX SmallCap Index ETF, $34,94, symbol XCS on Toronto (Units outstanding: 8.7 million; Market cap: $304.0 million), holds the 237 stocks in the S&P/TSX SmallCap Index. That index is made up of the smaller companies on the Toronto Stock Exchange. These stocks are chosen by their market size (their market caps must be between $100 million to $1.5 billion) and their liquidity.


The fund’s expenses are 0.60% of its assets. It yields 1.4%.

A: Park Aerospace Corp., $24.08, symbol PKE in New York (Shares outstanding: 19.9 million; Market cap: $481.4 million; www.parkaerospace.com), develops and makes materials used in the production of jet engines and other aerospace components.

Jerry Share and Tony Chiesa founded the company in 1954 before listing it on the New York Stock Exchange in 1984.

On top of jet engines, Park Aerospace’s materials are used to produce structures for transport and military aircraft, missiles, hypersonic systems and military drones. The company’s sales are generated in North America (96%), with limited revenues from Europe and Asia (4%).

A: Eaton Corp. plc, $335.98, symbol ETN on New York (Shares outstanding: 388.4 million; Market cap: $129.1 billion; www.eaton.com), is a power management company. Eaton serves many markets: datacentre, utility, industrial, commercial, machine building, residential, aerospace and mobility markets.

Founded in 1911, the company expanded worldwide and now has customers in more than 160 countries. Eaton operates through five segments: Electrical Americas (49% of revenue), Electrical Global (25%), Aerospace (15%), Vehicle (9%), and eMobility (2%).

People have long searched for recurring patterns in stock trading activity that they can use to gain the upper hand on other investors. Many try to link stock-price gains and setbacks to specific months or dates on the calendar. Others look to events outside of the market altogether. Regardless, of their chosen formula, all of these investors are attempting to create rules and indicators that seem to have “worked” in the past.

When you evaluate these patterns and rules, you have to keep one key fact in mind: random events often occur in bunches. When you flip a coin, any heads-tails pattern of any length can repeat any number of times.