Monthly dividend stocks. It’s the answer to the question, what’s better than publicly traded companies that provide passive income on a quarterly basis?
One of the fundamental advantages of monthly dividend stocks is of course the frequency. Receiving payouts every 30 days or so, investors have the opportunity to reinvest the funds back into the target company or other ideas. Plus, in an inflationary environment, money today is always worth more than money tomorrow.
Second, life basically occurs in monthly cycles. Whether we’re talking about your rent, your car payments or your utility bills, these come up every time the calendar turns a new page. By receiving funds 12 times out of the year instead of four, it’s easier to live off the passive income.
With that, below are intriguing ideas to consider for monthly dividend stocks.
Stag Industrial (STAG)
Based in Boston, Massachusetts, Stag Industrial (NYSE:STAG) focuses on the acquisition, ownership, and operation of industrial properties throughout the U.S. As of Dec. 31, 2023, Stag owned 569 buildings in 41 states with approximately 112.3 million rentable square feet. This footprint consists of 493 warehouse/distribution buildings, 70 light manufacturing buildings, one flex/office building, and five “Value Add Portfolio” buildings.
Over the trailing 52 weeks, STAG has put up a solid performance. That’s backed by an impressive financial print. Last fiscal year, the real estate investment trust (REIT) beat its per-share earnings target four times out of four. Indeed, the average positive earnings surprise came out to 57.25%, an impressive statistic.
For the current fiscal year, experts believe that earnings per share will land at 80 cents. While that’s below 2023’s print of $1.07, revenue may reach $751.44 million. If so, that would be a 6.6% gain from last year’s result of $705.16 million.
For passive income, Stag offers a forward yield of 3.91%, making it an intriguing choice for monthly dividend stocks.
Permian Basin Royalty Trust (PBT)
Based in Dallas, Texas, Permian Basin Royalty Trust (NYSE:PBT) plies its trade in the energy sector; specifically, it operates under the oil and gas midstream subsegment. According to its corporate profile, Permian holds royalty interests in various oil and gas properties. Fundamentally, as society fully normalizes from the COVID-19 pandemic, demand for hydrocarbons could swing upward.
As well, Permian might benefit from two cynical catalysts. First, legacy automakers have begun pulling back regarding their electric-vehicle ambitions. That suggests EV euphoria has faded, which means combustion-powered vehicles could have an extended lifespan. Also, geopolitical rumblings could hurt hydrocarbon supplies. This dynamic should also lift demand for PBT stock.
As for the passive income, Permian offers a forward yield of 3.87%. To be fair, the company currently lacks a track record of consistent annual payout increases. Further, there are big oil companies which provide a similar yield or even bigger.
The thing is, with Permian, you’re getting your passive income monthly. For some investors, that may be worth the heightened risk profile.
Realty Income (O)
A top-tier name among monthly dividend stocks, Realty Income (NYSE:O) has it all – a relevant business and a generous yield. Therefore, even if companies that provide passive income isn’t a priority, you should look into O stock. Per its public profile, the REIT enjoys cash flow from over 15,450 real estate properties, primarily owned under long-term net lease agreements with commercial clients.
For full disclosure, Realty incurred a choppy financial performance in fiscal 2023. Its best outing was Q3, when it produced EPS of 33 cents against a target of 31 cents. However, in Q2 and Q4, the REIT fell short of per-share earnings estimates. The negative earnings surprise came out to 10.5% for those two quarters. In Q1, the company met expectations at 34 cents.
However, analysts project that fiscal 2024 could be a recovery year, with EPS coming in at $1.41 on revenue of $4.87 billion. Last year, EPS reached $1.26 on sales of $4.08 billion.
For passive income, Realty offers a forward yield of 5.91%. Along with a 31-year track record of annual payout increases, O is one of the monthly dividend stocks to put on your radar.
On the date of publication, Josh Enomoto 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.
