Most investors are accustomed to receiving quarterly payouts from their dividend-paying securities, but there are opportunities to generate current income on a more frequent basis: monthly dividend stocks.
There are over 700 stocks that follow a monthly payout schedule and warrant a closer look from yield-starved investors. Monthly dividend stocks can help beef up your portfolio’s current income, and in turn, can help to improve risk-adjusted returns over the long haul thanks to the “cushion” offered by regular dividends.
Below we take a closer look under the hood of 12 monthly dividend stocks with stable payout records:
12. Gladstone Commercial (GOOD)
Based in Mclean, Virginia, this real estate investment trust (REIT) owns industrial and commercial real estate property that it leases to small and mid-sized business, as well as large public companies. Gladstone is also involved in making long-term industrial and commercial mortgage loans. This REIT has been paying monthly dividends on a regular basis since the start of 2005 and its current distribution is at the same level as it was prior to the 2008 financial crisis. Recent developments in the company include the purchase of a 320,000 square foot office building in the tech-center of Austin, Texas in July 2013.
Consider the visual representation of GOOD’s distributions below:
11. LTC Properties (LTC)
LTC Properties (LTC ) operates as a health care REIT based out of Westlake Village, California. The company invests in long-term care properties in the senior housing space, including skilled nursing properties, assisted living properties, and combinations of the various health care facility types. LTC has been paying regular dividends since 1992, although the REIT didn’t change to a monthly payout schedule until 2005; it’s worth noting that current monthly distribution exceeds those prior to the 2008 financial crisis.
Consider the visual representation of LTC’s distributions below:
10. Realty Income Corp (O)
This commercial REIT based out of Escondido, California is engaged in acquiring and leasing freestanding retail and other rental-income properties under long-term agreements. Founded in 1970, Realty Income boasts a diversified portfolio of over 2,600 properties spanning across more than 35 separate industries. The company has been paying monthly dividends since 1995 and its current distribution is well above pre-housing bubble levels. Realty Income acquired American Realty Capital Trust at the start of 2013.
Consider the visual representation of (O )’s distributions below:
9. Sabine Royalty Trust (SBR)
Founded in 1982 and based in Dallas, Texas, this trust receives a distribution from Sabine Corporation, which operates various oil & gas properties domestically; its largest tracts are in Oklahoma and Texas, although it has properties in Louisiana, New Mexico, Mississippi, and Florida. The Sabine Royalty Trust (SBR )has been paying monthly dividends on a consistent basis since 1990 and its share price currently offers attractive potential for upside as well. Though Sabine’s dividend amount has varied throughout the years, the company has always reliably paid a dividend, and has kept that dividend above 20 cents over the past 5 years.
Consider the visual representation of SBR’s distributions below:
8. Shaw Communications (SJR)
Based out of Calgary, Alberta, Canada, Shaw Communications (SJR ) is a diversified Canadian communications company founded in 1966. Its operations include providing broadband cable TV, satellite services, internet, and digital phone, in addition to telecommunications services for businesses. The company has been paying monthly dividends since 2005 and its current payout is above distribution levels prior to the 2008 crash. Recent developments in the company include the acquisition of ENMAX Envision, a provider of high-speed data communications, in April 2013.
Consider the visual representation of SJR’s distributions below:
7. American Realty Capital Properties Inc. (ARCP)
Founded in 2010 and based in New York, this REIT has been paying out monthly distributions on a regular basis despite its fairly short operating history compared to some of the other stocks profiled here. American Realty Capital Properties (ARCP ) is engaged in acquiring and leasing single-tenant, free standing commercial real estate properties; the company’s clients are largely investment grade corporations and its property portfolio is diversified across more than 20 different industries. In April of 2013, the company closed six property lease deals, including tenants CVS and Family Dollar.
Consider the visual representation of ARCP’s distributions below:
6. STAG Industrial, Inc. (STAG)
STAG Industrial, Inc. (STAG ) is a Boston-based REIT that was founded in 2003. The company has been paying a dividend since 2011, and started a monthly distribution in 2013. The company has been boosting its monthly dividend every year, although its annualized dividend was lower in 2014. STAG owns over 200 properties across the United States and focuses on industrial properties.
Consider the visual representation of STAG’s distributions below:
5. Cross Timbers Royalty Trust Units (CRT)
For those that value consistency of dividends, the Cross Timbers Royalty Trust (CRT ) warrants a closer look, as it has been paying out monthly distributions without interruption since 1992. Based out of Dallas, Texas, this express trust receives royalties from various producing and non-producing timber properties concentrated in Texas, Oklahoma, and New Mexico. From a longer-term investment perspective, Cross Timber’s share price may offer an attractive value opportunity because it is heavily beat down over the last two years, but has been rebounding off a major support level quite nicely in recent weeks [see also The Ten Commandments of Dividend Investing]. Though Cross’s monthly payout does fluctuate, it’s never been below 10 cents, even when it dipped during the last recession.
Consider the visual representation of CRT’s distributions below:
4. Gladstone Capital (GLAD)
Gladstone Capital (GLAD ) is a closed-end, non-diversified management investment company based out of McLean, Virginia. More specifically, the company delivers a high level of current income to shareholders through an investment strategy focused in the debt market; Gladstone Capital invests in senior and junior debt notes of private businesses that are substantially owned by leveraged buyout funds and individuals, as well as families. The company was founded in 2001 and it has been paying monthly dividends on a regular basis since the fourth quarter of 2003. Gladstone’s payout dipped during the last recession, but since then has been consistent.
Consider the visual representation of GLAD’s distributions below:
3. Enerplus Corporation (ERF)
Founded in 1986, Enerplus (ERF ) is a Canadian oil and gas producer based out of Calgary and has been paying out monthly distributions consistently since 2001. The company’s properties are split roughly 60/40 between natural gas and crude oil. Though it operates primarily in Western Canada, the company is also involved in energy properties across the states of Montana, North Dakota, Pennsylvania, West Virginia, and Wyoming. From a long-term perspective, Enerplus stock is heavily discounted and warrants a closer look from yield-starved, value investors. Enerplus has cut its dividend in the past two years, and again during the last recession, but it has reliably paid every month. For broader exposure to the energy sector, look at an ETF such as XLE.
Consider the visual representation of ERF’s distributions below:
2. Hugoton Royalty Trust (HGT)
This express trust holds 80% net interests in certain working natural gas producing properties owned and operated by XTO Energy, Inc. The Hugoton Royalty Trust (HGT ) is based out of Dallas, Texas, and operates properties in Kansas, Oklahoma, and Wyoming; its portfolio includes over 1,200 oil producing wells and 45 gas producing wells. This trust has delivered a steady stream of monthly distributions to shareholders since 1999 and its beat-down share price offers an attractive opportunity to lock in in a hefty yield in the current ultra low rate environment [see also The Unofficial Dividend.com Guide To Being An Investor]. This company boasts consistency in payments, although there is volatility in the distribution given the nature of the basic materials sector.
Consider the visual representation of HGT’s distributions below:
1. Main Street Capital Corp. (MAIN)
Main Street Capital (MAIN ) was founded in 1997, and is based out of Houston, Texas. The company has been making regular monthly payouts to shareholders since 2011. The investment company provides customized debt and equity financing to lower-middle market companies; this includes firms with annual revenues between $10 million and $100 million that operate in a diverse range of industries. In September of 2013, the company acquired TBT Holdings Co Inc., an aluminum dump trailer manufacturer from Houston.
Consider the visual representation of MAIN’s distributions below:
The Bottom Line
Stocks that pay monthly dividends can be great for income-focused investors. Monthly dividend stocks can also be attractive when reinvesting dividends [see also: DRIPs 101: A Guide to Dividend Reinvestment Plans]. To find more of the best monthly dividends stocks, check out our entire list of monthly dividend stocks.