Raging rivers and budding forests are sure signs of spring, and they’re good signs for this month’s Best Buys—longtime Canadian Edge Portfolio holdings Acadian Timber and Innergex Renewable Energy—too.

That’s because trees and rivers, or, more specifically, forest products and hydroelectric power, underlie both companies’ 5%-plus yields. What’s more, both recently announced strong results—and solid dividend hikes to go along with them.

Let’s start with Acadian.

Lumber Leader

Acadian Timber Corp. (TSX: ADN, OTC: ACAZF) is the second-largest timberland operator in Eastern Canada and the Northeastern U.S., with 2.4 million acres under management. Its products—sold to about 90 regional customers—include softwood and hardwood sawlogs, pulpwood and biomass byproducts (or organic material that can be used to produce clean energy).

The company is more susceptible to economic ups and downs than Innergex (see below), but it’s benefiting from an improving North American construction market.

That was reflected in its latest financial results: In the year ended December 31, 2014, Acadian sold 1.31 million cubic meters of forest products, for total net sales of CAD77.4 million. That’s up from net sales of CAD74.4 million on 1.38 million cubic meters in 2013.

Prices for most of the company’s products remained well above prior years, driving adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to their highest fourth-quarter levels in Acadian’s history.

For the year, EBITDA jumped 24.6%, to CAD21.8 million. Acadian saw a 10% rise in its average log-selling price and kept a tight lid on costs. Free cash flow came in at CAD17.6 million, and the company paid CAD13.8 million of dividends, for a payout ratio of just 78.4%.

Acadian also boosted its dividend by 9.1%, the first hike since it converted to a corporation from an income trust in March 2011. The new dividend rate increases its payout ratio to 85.7%, but that’s still well below management’s target of 95%.

To top it off, the stock trades at just 1.15 times book value, making it an attractive buy at current levels.

Acadian’s leadership remains bullish on the company’s prospects: During the conference call to discuss the latest results, management said it raised the dividend “in recognition of this strong performance, along with an expectation of continued strong performance over the next several years.”

Specifically, management sounded several optimistic notes about the housing sector in 2015, including strong job growth in the U.S., where employers added an average of 246,000 positions a month in 2014, the strongest gains in 15 years.

Further housing gains, along with continued strong exports, should keep North American lumber prices well above historical norms. That would encourage Acadian’s key solid-wood customers to keep operating at full capacity, increasing demand for its sawlogs in the process.

Acadian Timber—now yielding 5.2%—is a buy for aggressive investors under USD15.

Generating Total Return

Innergex Renewable (TSX: INE, OTC: INGXF) has been a member of the CE Portfolio since the December 2008 issue. During that time, it’s generated a total return of more than 200% in U.S. dollar terms, besting both the S&P/Toronto Stock Exchange Composite Index (133%) and the S&P 500 index (174%).

The company has a 1,200-megawatt (MW) portfolio of power plants that includes hydroelectric, wind and solar sites in British Columbia, Quebec, Ontario and Idaho.

Its holdings include stakes in 33 facilities comprising 26 hydro plants (547 MW of capacity) that support 71% of its revenue. Its six wind facilities accounted for 22%, and its single solar site added 7%.

In 2014, Innergex generated 48% of its revenue in British Columbia, 41% in Quebec, 9% in Ontario and 2% in Idaho. The company’s diversification between energy sources and regions cuts its exposure to variable levels of rainfall, wind and sunlight, as well as to any one market.

Locked-In Cash Flow

Innergex sells its power under long-term deals at premium prices, mainly to governments and regulated utilities. That locks in cash flow and virtually eliminates default risk.

The company is an invest-to-grow story, with every new hydroelectric, solar and wind-power plant it brings on line adding to its cash flow.

During 2014, new projects supported a 24.4% increase in Innergex’s power production over 2013, to 2,962 gigawatt hours, which represents 100% of the long-term average for its facilities. The company’s hydro and wind plants produced at 100% of their long-term averages, while the Stardale solar farm hit 104%.

Revenue rose 21.9% on the year, to CAD241.8 million.

Adjusted EBITDA came in at CAD179.6 million, up 20.6%, while adjusted EBITDA margin slipped from 75.1% to 74.3% on higher general and administrative expenses and costs for prospective projects.

Free cash flow gained 14.7% to CAD67.7 million. Innergex paid out 88% of its free cash flow to shareholders, down from 93% in 2013 and 115% in 2012.

The company also raised its dividend 3.3%. That marks the second straight year of dividend growth for Innergex, which converted to a corporation from an income trust in June 2010.

Innergex has five projects slated to reach commercial operation by the end of 2016, boosting the company’s gross installed capacity by 27%. During the latest post-earnings conference call, management said it’s “very confident” in these projects’ development and that it will meet its cost and in-service targets.

Innergex’s ability to cut risk in its development pipeline has been critical to its improving financial position in recent years and will result in significantly higher cash flow and dividend growth starting in 2017.

Tapping a Global Trend

Management continues to take a balanced approach, focusing on boosting capacity and increasing Innergex’s dividend in a highly predictable way. That’s a sound strategy that should create shareholder value in the long run.

The company continues to benefit from rising demand for renewable power, driven by support for limiting carbon emissions to address climate change, a desire to diversify energy sources, and the retirement of conventional power plants.

Globally, renewable generation is expected to grow 45%, or 5.4% a year, to 2020. New investment in renewables is forecast to remain around USD230 billion, supporting the addition of about 125 gigawatts a year to global generation capacity.

In the U.S., renewables are the fastest-growing source of power generation; non-hydro renewable energy is expected to grow 140%, or 3.2% a year, and from 12% to 16% of total output by 2040.

Innergex’s geographic diversification, favorable mix of renewable-power facilities and ample expansion opportunities make it a solid bet for long-term growth and income. And at these levels, the stock is trading at just 13.3 times cash flow.

Innergex Renewable Energy, currently yielding 5.3%, is a buy under USD11.