If you think you won’t need another paycheque after retirement, I hope you’re right. But personally, I’d feel much better knowing some money was still coming in every few months, even when I wasn’t working anymore. After all, the bills don’t retire just because you do. That’s one reason I find dividend stocks so appealing.
You can spend your mornings doing whatever you enjoy while the businesses you own continue working in the background. Of course, I wouldn’t trust just any high-yield dividend stock with that job. Instead, I’d want a stock that generates healthy cash flow and has a reasonable chance of growing its payouts over time.
A top Canadian dividend stock for retirement income
The stock I want to highlight here is Pembina Pipeline (TSX: PPL), as its extensive energy infrastructure network makes it an attractive choice for investors looking to earn dependable passive income after retirement. The Calgary-based company operates pipelines, processing facilities, and other infrastructure that play an important role in moving Canadian energy products to market.
Pembina stock has climbed 29% so far in 2026, and currently trades at $67.55 per share with a market cap of $39.3 billion. Besides its impressive share-price performance, PPL also offers an attractive 4.4% annualized dividend yield and distributes its payouts every quarter. Its latest declared quarterly dividend of $0.74 per share translates into $2.94 yearly.
While Pembina’s dividend and share-price gains are appealing, I also like the company’s improving financial performance and growing pipeline of expansion projects, which could support retirement income for years to come.
Strong financials supporting dividends
After all, a dividend stock can only keep rewarding investors if the underlying business continues to generate healthy cash flow. And Pembina appears well positioned to keep delivering on that front.
In the second quarter, the company’s revenue jumped 20% year-over-year (YoY) to $2.2 billion, driven largely by higher revenue from its marketing & new ventures business. Meanwhile, its quarterly earnings surged 23% YoY to $512 million, supported by stronger contributions from its Facilities and Marketing & New Ventures divisions. The company’s adjusted earnings also climbed 10% to $415 million.
More importantly for dividend investors, Pembina’s adjusted cash flow from operating activities climbed by over 11% YoY to $778 million, or $1.34 per share. This per-share cash flow comfortably exceeded its quarterly dividend of $0.74, although it doesn’t account for all capital spending.
More growth opportunities ahead
And the good news for retirement investors is that Pembina isn’t simply relying on its existing operations to keep the dividend income flowing. In May 2026, the company completed its Redwater expansion on time and under budget, adding 55,000 barrels per day of fractionation capacity. It also approved the $570 million Heartland Extraction Plant, supported by expanded long-term supply agreements with Dow.
Interestingly, Pembina’s newly approved Greenlight Electricity Centre should also generate stable, long-term contracted cash flow by supplying electricity to a Meta data centre. Meanwhile, the Canadian energy infrastructure firm’s Cedar liquefied natural gas (LNG) project continues progressing toward its first exports expected in late 2028.
With the company targeting 5% to 7% annual growth in fee-based adjusted EBITDA per share through 2030, Pembina still has many opportunities to strengthen its future cash generation.
For retirement investors, its attractive quarterly dividends, improving cash flow, and long-term expansion plans make Pembina an appealing stock for earning reliable passive income for years.
