What are we looking for?
Sustainable dividends from companies using big acquisitions to broaden their market reach and earnings.
The screen
The stock price for oil company Ovintiv Inc. OVV-T has moved up since its February, 2026, acquisition of the remaining shares of NuVista Energy Ltd. It paid US$2.7-billion in cash and stock.
NuVista expands the company’s reach to adjacent oil deposits in Western Canada’s Montney and northeastern B.C. regions. The close proximity lets the merged company reduce costs while boosting cash flow.
Our analysts at The Successful Investor point out that most growth-by-acquisition strategies carry risk. Still, top firms can limit fallout by targeting smaller purchases or, as Ovintiv did, by buying proven assets that complement their own existing operations.
Our search started with U.S. and Canadian firms that have recently undertaken major acquisitions to expand their operations and to spur profitability. We then applied our TSI Dividend Sustainability Rating System to those offering shareholder dividends. 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 being 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.
More about TSI Network
TSI Network is the online home of The Successful Investor Inc. – the group of widely followed Canadian investment newsletters by editor and publisher Pat McKeough. They include our award-winning flagship newsletter, The Successful Investor, and the TSI Dividend Advisor. TSI Network is also affiliated with Successful Investor Wealth Management.
What we found
Our TSI Dividend Sustainability Rating System generated seven stocks. (Note: recent share-price gains for most of them have resulted in meagre-looking dividend yields.)
Ovintiv, with its headquarters in Denver, but with a major regional office in Calgary, operates two core properties: Montney (B.C.) and Permian (Texas). In addition to natural gas, these fields produce large amounts of oil and natural gas liquids. Ovintiv is set to gain even more as it further successfully integrates NuVista Energy.
Eaton Corp. PLC, ETN-N headquartered in Ireland, is a power management company. It serves many markets: data centre, utility, industrial, commercial, machine building, residential, aerospace and mobility. In January, 2026, it completed the acquisition of Ultra PCS Limited, a British-based provider of electronic controls, pneumatic systems and data processing services for global aerospace customers. Eaton paid US$1.55-billion.
Baker Hughes Co., BKR-Q headquartered in Houston, is an energy technology company serving customers worldwide. In July, 2026, it bought Chart Industries for US$13.6-billion. Chart designs and makes technologies and equipment for gas and liquid molecule-handling. It should be a strong fit for Baker Hughes, in part because of its growing focus on the fast-growing liquefied natural gas market.
TMX Group Ltd., TMXXF based in Toronto, is an operator of public trading platforms, including the Toronto Stock Exchange. It also sells a wide range of financial, corporate, and trading data. In August, 2026, TMX Group completed the purchase of California-based global index provider RAFI Indices LLC for US$490-million. RAFI currently tracks approximately 90 indexes and will add to TMX’s offerings.
Saint Paul, Minn.-headquartered Ecolab Inc. ECL-N provides water, hygiene, and infection prevention systems and services to businesses worldwide. In March, 2026, it announced acquisition of CoolIT Systems, a provider of liquid-cooling technology for next-generation data centres. Ecolab is paying US$4.75-billion for the Calgary-based company. The combination of CoolIT’s liquid-cooling technology with Ecolab’s Global Water business should accelerate Ecolab’s growth.
Based in Irving, Tex., Flowserve Corp. FLS-N manufactures industrial pumps, valves, and other machinery for industrial use of dangerous fluids. The company’s June, 2026, purchase of Trillium Flow Technologies’ Valves Division, for US$490-million in cash, strengthens its offerings for nuclear reactors.
And finally, Laval, Que.-headquartered Alimentation Couche-Tard Inc. ATD-T operates convenience stores, mostly in North America and Europe. The company now plans to acquire Poland’s largest convenience retailer Zabka for about US$8.7-billion to expand its footprint in central and eastern Europe.
Editor’s note: A previous version of this article incorrectly stated that TMX Group purchased RAFI Indices LLC for US$490-billion. The purchase price was US$490-million.
Scott Clayton, MBA, is senior analyst for TSI Network and associate editor of TSI Dividend Advisor.