Monthly dividend stocks can be a great source of income for young investors who are just starting out on this path, but also for older people who might be looking for a way to supplement their salaries or their pensions. Finding good monthly dividend stocks, is not that difficult. Many companies choose to pay their dividends monthly, rather than quarterly or yearly, and each company discloses their dividend policy publicly. The true challenge is to find monthly stocks with a good yield and consistent payments. Since monthly stocks can be a tad risky, you need to find those stocks that have a solid history of monthly payment, and whose balance sheets promise stability and consistency. To find the best such stocks, we called upon the experts from Dividend Appreciation, who were willing to share their market researchwith us. Without further ado, here are the top 3 best monthly dividend stocks that you should be focusing on this year:
3. STAG Industrial
Real estate investment trusts are among the best stocks that pay monthly dividends and STAG makes no exceptions. Despite the fact that they are one of the smallest industrial property trusts in the country, they have had a clean financial history which allows them to borrow money at attractive rates to fund their new investments. Their main strategy is to find undervalued properties that they can lease long-term. This strategy has paid off well for them in the past and at the moment they have a 6% yield.
2. Shaw Communications
Despite being the smallest telecom company in Canada, Shaw Communications shows great potential. It has a small PE ratio of only 10.7, and a 5% dividend yield with a 58% payout ratio. To make things even clearer for you, if you buy at the present price of $21.3, you will get a 4.2% yield, because the current $0.074 cash dividend will add up to $0.89 by next year.
1. Realty Income
As we already mentioned, the financial history is the strongest indicator of quality when it comes to monthly dividend stocks. Based on this fact, we are confided to say that we will strike gold with Realty Income. They are the oldest REIT on the market, and ever since 1994, they have had 85 dividend increases. Their financial stability is the main reason why the credit rating agencies have awarded them a BBB+ credit rating, which allows them access to the cheapest funds on the market. Based on the current price and the anticipated AFFO, their P/AFFO ratio is an amazing 20.