2 Undervalued Canadian Dividend Stocks That Look Attractive in 2026

By Andrew Walker at The Motley Fool Canada

Contrarian dividend investors are constantly searching for undervalued stocks that might be good to add to a self-directed Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) portfolio.

Buying stocks that are pulling back takes courage and the patience to ride out additional volatility. However, the long-term rewards could be significant on a rebound.

Canadian Natural Resources

Canadian Natural Resources (TSX:CNQ) rallied in the first three months of 2026, rising from $42 to $70 as oil prices soared. The stock has since given back some of the gains, slipping below $60 per share.

Near-term volatility should be expected as reports on the opening or closing of the Strait of Hormuz send oil prices lower or higher in frantic surges.

At some point, the U.S. and Iran will work out an agreement that will see oil and liquified natural gas (LNG) traffic through the narrow waterway resume pre-war levels. This will, however, take some time and the lingering effects of the shutdown should benefit CNRL in the long term, even if oil prices decline.

CNRL is a major Canadian oil and natural gas producer. Demand for Canadian energy is expected to surge in the coming years as countries that have been impacted by supply cuts due to wars in Ukraine and the Middle East seek out reliable sources of oil and liquified natural gas.

Canada is building new LNG export capacity and the country’s focus on being an energy superpower could lead to new oil export capacity, as well. CNRL has extensive oil sands, conventional light and heavy oil, offshore oil, natural gas liquids, and natural gas production and reserves.

The company has the financial firepower to make large acquisitions to boost revenue and reserves. A strong balance sheet also enables CNRL to maintain organic investments and dividend growth through the full energy cycle. The board has increased the dividend for 26 consecutive years. At the time of writing, CNQ stock provides a dividend yield of more than 4%.

Enbridge

Enbridge (TSX:ENB) is another stock that surged in Q1, but it has recently given back some of the gains. The energy infrastructure and utilities giant is primarily known for its oil and natural gas transmission assets that move nearly a third of the oil produced in the United States and Canada, as well as about 20% of the natural gas used by American businesses and homes.

Enbridge shifted its expansion strategy in the past few years, making acquisitions outside the core segments to expand the asset base while complementing the existing businesses. The company spent US$14 billion to buy three natural gas utilities in the United States. Enbridge also purchased an oil export terminal in Texas and is a partner on the Woodfibre LNG export facility being built on the coast of British Columbia.

Finally, Enbridge bulked up its renewable energy division that builds wind and solar installations. Demand for these assets is rising as tech firms look to secure green energy supplies to help power AI data centres.

Enbridge is currently working on a $39 billion capital program that is expected to raise earnings and distributable cash flow by about 5% per year over the medium term. This should support ongoing dividend increases. Investors who buy ENB stock at the current price can get a dividend yield of 5.5%.

The bottom line

CNRL and Enbridge pay good dividends that should continue to grow. If you have some cash to put to work in a portfolio focused on dividends, these stocks deserve to be on your radar.

The post 2 Undervalued Canadian Dividend Stocks That Look Attractive in 2026 appeared first on The Motley Fool Canada.

More reading

• Where to invest in a TFSA in 2026

The Motley Fool recommends Canadian Natural Resources and Enbridge. The Motley Fool has a disclosure policy. Fool contributor Andrew Walker has no position in any stock mentioned.

2026