I’m always on the lookout for dividend stocks that can fill up my calendar, as I’d prefer to retire with income for every month of the year.
Profitable Investing’s Richard Band provided guidance on drawing up such a plan by choosing three dividend stocks based on when they make their payouts so you can schedule something of a monthly income plan.
It’s a great idea, but something to note is that while most dividend stocks you’ll come across pay out on a quarterly basis, not all of them do. And that’s why it’s always important not just to check a dividend stock for yield, but the frequency of payouts within a given year.
The following three stocks are great additions to a dividend portfolio — they just march to a different beat:
Monthly Dividend: Realty Income (O)
Realty Income (O) is a real estate investment trust that focuses on retail, boasting a portfolio of more than 3,600 properties representing more than 27 million square feet of available lease space.
Realty Income looks primarily for free-standing retail buildings, and its highest percentage of lease revenue is derived from distribution center properties — primarily from its largest tenant (5.3% of the portfolio), FedEx (FDX). The portfolio also includes Walgreen (WAG) at 4% of the portfolio and Family Dollar (FDO) at 3%.
As a REIT, Realty Income must pay out at least 90% of its income as dividends to investors, and Realty Income does in the most shareholder-friendly way possible: once every 30 days or so. Realty Income has been around for 44 years and has paid out monthly dividends for nearly 20 years.
For Pete’s sake, Realty Income actually describes itself as the “Monthly Dividend Company!”
O shares’ current 18.19-cent payout is roughly 30% better than it was four years ago, and translates into an enticing 5.35% yield. Because of the nature of REIT dividends, Realty Income tends to slightly increase its payout several times a year.
Semiannual Dividend: Accenture (ACN)
Management consulting and technology outsourcing giant Accenture (ACN) services a global stable of clients, operating in 200 cities across 54 countries.
This is a Rolodex that includes 89 members of the Fortune Global 100, and 75% of the Fortune 500.
Not bad company to be in.
Accenture keeps growing revenues, with FY2013’s $30 billion up 31% from three years ago. Growth has slowed a bit, but things are still pointed in the right direction. FY2013 revenues were up 2% year-over-year, with Wall Street expecting 3%-plus rev growth in FY14 and 5% in FY15. Earnings growth is slated for an even faster clip.
Accenture’s dividend history is just as impressive, albeit unorthodox. Accenture actually paid annual dividends for a few years before switching to semiannual payouts in 2010. The current 81-cent dividend is more than double its first 2010 payout, and represents a yield of 2.6% on current prices.
Annual Dividend: Nestle (NSRGY)
It always pays to diversify, and a good way to do so is by seeking stable, income-producing blue chips … just outside American borders.
Swiss global food and beverage giant Nestle (NSRGY) screams “chocolate” here in the U.S., but it has a huge brand portfolio that also includes water (Pure Life), coffee (Nescafe), dairy (Carnation) and ice cream (Dreyer’s). And while it trades over the counter, it’s not some questionable small-cap — NSRGY boasts a market cap of nearly U.S. $200 billion, and its American depository receipts (ADRs) trade hands at nearly a million shares daily.
Like many international companies, Nestle doesn’t pay quarterly. In fact, should you invest in Nestle, you’re looking at lump sum dividend payments once a year … but Nestle has paid dividends every year since 1959, so you don’t have to worry about the dividend evaporating. Its most recent payout was for $1.81, good for a yield of roughly 2.5% on current prices.For timing purposes, Nestle historically pays dividends five days after its annual general meeting, traditionally held in April.
Also, keep in mind that because NSRGY is an ADR, there’s currency risk to consider, too. Nestle dividend payments are made in the Swiss franc, with U.S. dividends converted accordingly.
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.