The best safe monthly dividend stocks are remarkably compelling during the current market downturn. However, many top dividend stocks have also taken a sizeable hit in value over the past several months.
The pull-back presents an incredible opportunity to load up on dividend stocks and generate regular income.
Dividend stocks usually belong to companies with stable businesses with robust earnings that can be reinvested for the benefit of their shareholders. During the current bear run, it can help investors cut down on their losses significantly.
When the economy is in shambles, investors are looking for stocks to protect their portfolios. These stocks essentially pay investors to hold on to them and can potentially reinvest their income to supercharge portfolio growth.
With that being said, let’s look at seven of the best dividend stocks you should invest in.
|SJT||San Juan Basin Royalty Trust||$9.85|
EPR Properties (EPR)
Dividend Yield: 8.2%
EPR Properties (NYSE:EPR) has recently seen its stock dip due to rising interest rates. However, another major issue for the net lease real-estate-investment-trust (REIT) is that one of its largest tenants, CineWorld, filed for bankruptcy.
However, the REIT has a healthy cushion to maintain its strong dividend numbers. After paying its dividends, it expects to generate an incredible $150 million in excess cash.
Moreover, it operates an investment-grade balance sheet with plenty of liquidity, including $1 billion in undrawn credit facility.
In expanding its portfolio, it will be looking to invest $500 million to $700 million in acquiring new real estate this year. Those deals are likely to help diversify its exposure to the theater sector, helping improve the long-term sustainability of its dividend.
Gilead Sciences (GILD)
Dividend Yield: 4.65%
Gilead Sciences (NASDAQ:GILD) is one of the leading biotechnology companies with a market cap of over $70 billion. It’s been growing sales at a healthy pace each quarter and recently wrapped up a reasonably successful second quarter.
Product revenues outside of its coronavirus-focused drugs rose 7% from the prior-year period amounting to annualized sales of $23 billion.
Its investments in new businesses are paying off, with oncology sales up by more than 71% for the quarter. GILD also increased its guidance for the quarter despite a few setbacks as it continues to execute on its pipeline in driving returns.
Also, it has several exciting catalysts, with a wide portfolio of oncology drugs entering Phase 2 and 3 trials. With more than $6 billion in cash, it remains in a strong position to maintain its dividend payouts for the foreseeable future.
Dividend Yield: 3.92%
Chevron (NYSE:CVX) is the second-largest integrated oil and gas company in the U.S. It has been one of the most reliable income stocks thanks to its robust dividend scorecard.
It raised its dividend payouts for 35 straight years, making it a dividend aristocrat. Though dividend growth isn’t too high, its yield more than makes up for it.
At $75 a barrel, it can do up to $40 billion in annualized operational cash flows, roughly $200 billion until 2026.
Moreover, it implies an incredible 7% shareholder distribution. Given its massive capital expenditure plans, it’s likely to do much better than $40 billion in cash flows.
San Juan Basin Royalty Trust (SJT)
Dividend Yield: 15.16%
San Juan Basin Royalty Trust (NYSE:SJT) is a Texas-based express trust that owns interests in various oil and gas properties in the San Juan basin of New Mexico.
It pays out higher royalties when oil and gas prices are up, as they have been of late. Consequently, its revenue growth on a year-over-year basis is 171.5%, comfortably ahead of its 5-year average of 47%.
Its stock sold off earlier in the year amidst a strong pullback in U.S. natural gas prices after the Freeport LNG explosion.
Once export capacity improves though, natural gas prices will trend northward thanks to rising European demand for securing non-Russian gas supply.
Dividend Yield: 5.3%
Semiconductor stocks emerged as winners during the pandemic, but one of the biggest players in the niche, Intel (NASDAQ:INTC), couldn’t reap most of those gains. Consequently, it trades at just 1.7 times forward sales, more than 44% lower than its 5-year average.
Current market headwinds have affected recent results from Intel, but its focus is more on its future, where it aims to revolutionize semiconductor manufacturing. It plans to spend a whopping $55.5 billion in capital expenditures on developing foundry fabrication plants, or “Fabs.”
It aims to become the main resource for fabricating chips to order, representing the next era of semiconductor manufacturing. Moreover, the company is likely to be the biggest beneficiary of the U.S. government’s CHIPS Act, which could have it see $10 billion to $15 billion worth of subsidies in the next five years.
Dividend Yield: 6.38%
Dow (NYSE:DOW) is among the three largest chemical companies worldwide, with annualized net sales of over $50 billion. It’s one of the most consistent businesses in its niche, generating 11% sales growth on average over the past five years.
Its current net sales exceed $50 billion, and it’s maintaining its annual EBITDA target of over $9 billion.
Dow boasts several competitive strengths over its peers, including its extensive low-cost feedstock positions, massive scale, high-quality manufacturing, and market reach. Consequently, it has built a cash war chest, which includes $2.4 billion in cash equivalents and $12.2 billion in available liquidity.
In the past six months, it generated a remarkable $2.7 billion in free cash flows, taking its levered cash flow margin to almost double-digits. Hence, its rock-solid liquidity positioning is in a strong position to maintain its dividend portfolio for the foreseeable future.
LTC Properties (LTC)
Dividend Yield: 5.92%
LTC Properties (NYSE:LTC) is a REIT specializing in senior housing communities and skilled nursing centers.
Its operating results have fluctuated over the past several quarters, but of late, it’s been posting some strong numbers. It is likely to benefit from the secular trend of an aging population in the U.S., which bodes incredibly well for its long-term positioning.
Its second-quarter results were a peach, with it beating revenue and EPS estimates by 11.7% and 9%, respectively. Moreover, total sales of $43 million topped consensus estimates of $37.9 million and $38.1 million from the same quarter last year.
Rental income came in at $31.6 million compared to $30.3 million in the prior-year quarter. Moreover, total expenses rose by a mere 5.5% due to cost efficiencies and lower depreciation charges.
On top of that, it reported a hefty $38 million gain from real estate sales. Therefore, LTC remains in a strong position to continue capitalizing on senior housing and skilled nursing properties by expanding its margins.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.