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It’s no secret that Canada’s population is aging. What may come as a surprise is now quickly the transformation is occurring.
In 2023, almost 19% of Canadians were 65 or older, and that number is expected to rise to more than 21% by 2030.
In the superage category, the number of people 85+ is expected to triple by 2046.
In the meantime, the percentage of the population of working age is gradually declining.
All this has major implications for the Canadian economy, many of which have not been addressed in a meaningful way. They include:
Old Age Security: As more people qualify for OAS, it puts a greater strain on maintaining payments at current levels. This is because there is no dedicated Old Age Security fund (unlike Canada Pension Plan), so the program is financed from general revenues. A combination of low birth rates, longer life expectancy, and a dwindling work force to support an aging population spells big trouble down the road. Several countries that have attempted to cut costs by raising the retirement age have encountered strong public resistance.
Health care: Older people need more medical attention than younger ones. That means more doctors and nurses, higher per capita costs for dental care and pharmaceuticals, more diagnostic tests, more home care services – all of which will put an increasingly heavy strain on government budgets.
Specialized accommodation: Many people would prefer to age in place but can’t do so for a variety of reasons. They include mobility problems, loss of mental capacity, debilitating physical issues, and lack of finances. What do we do with these folks?
Right now, the answer is to construct a patchwork quilt of public and private institutions designed to accommodate elderly people in varying stages of aging. Some of these homes offer only baseline accommodation and support. The horror stories that emerged during the pandemic about the indifferent and in some cases abusive treatment some people were receiving shocked the country.
Other retirement and long-care residences can be compared to five-star hotels. They offer gourmet meals, luxurious suites, nightly entertainment, bars, pool tables, swimming pools, beauty salons, 24-hour on call nurses, and planned excursions. I think of them as stationary cruise ships.
How can investors take advantage of this growing demographic trend? Here’s one company positioned to meet growing demand in this sector.
Extendicare Inc. (TSX: EXE) has been posting strong results and has seen its stock more than double in value over the past year. It is based in Markham, Ontario and provides care and services for seniors across Canada under a variety of names, including ParaMed, Extendicare Assist, SGP Purchasing Network, and its own corporate name. The company operates 99 long-term care homes, of which it owns 59. The rest are managed under contract. The company has a staff of about 28,000.
The stock took a hit when the company (along with others) was named in class-action lawsuits arising from the pandemic. These lawsuits allege inadequate protection and preparedness that contributed to the spread of infections and death. The cases are still pending. The stock was virtually flat from 2021 to early 2025, when it began to move sharply higher on the strength of improving financials. It is now trading near its record high.
Extendicare is one of the leaders in its field and maintained its dividend through the pandemic despite experiencing a stressful environment and negative publicity. Third-quarter results were strong. Revenue was up $81.2 million year-over-year, to $440.3 million, driven primarily by the acquisition of nine new homes. Adjusted EBITDA increased $14.7 million, to $50.8 million, while net operating income was $65.9 million, up $15.8 million. Net earnings were up 48%, to $24.1 million, while adjusted funds from operations (AFFO) were $29.5 million ($0.349 per basic share).
Last year, the company completed the acquisition of Closing the Gap (CTG) for $75.1 million. CTG brings a team of 1,200 caregivers with experience in nursing, health, and pediatric services.
Extendicare pays a monthly dividend of $0.042 per share ($0.504 a year) to yield 2.1% at the current price. The last dividend increase was in March 2025.
The stock is suitable for investors who are willing to accept a modest yield plus capital gains potential in a sector that will continue to grow as the population ages. Before investing, be sure to consult with your financial advisor to ensure the stock fits with your financial objectives and tolerance for risk.
Gordon Pape is one of Canada’s best-known personal finance commentators and investment experts. He is the publisher of The Internet Wealth Builder and The Income Investor newsletters, which are available through the Building Wealth website.
Follow Gordon Pape on X at X.com/GPUpdates and on Facebook at www.facebook.com/GordonPapeMoney.
For more information and details on how to subscribe to Gordon’s newsletters, go to www.buildingwealth.ca/subscribe.
Notes and Disclaimer
Content © 2026 by Gordon Pape Enterprises. All rights reserved. Reprinted with permission. The foregoing is for general information purposes only and is the opinion of the writer. Securities mentioned carry risk of loss, and no guarantee of performance is made or implied. This information is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting, or tax advice. Always seek advice from your own financial advisor before making investment decisions.
Image: iStock.com/Evrymmnt
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