The 9 Best Monthly Dividend Stocks to Buy Right Now

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Monthly dividend stocks are a game-changer for income investors.

For all the changes we’ve experienced in recent years, some things remain regrettably the same. We all have bills to pay, and those bills generally come monthly. Whether it’s your mortgage, your car payment or even your regular phone and utility bills, you’re generally expected to pay every month.

While we’re in our working years, that’s not necessarily a problem, as paychecks generally come every two weeks. And even for those in retirement, Social Security and (if you’re lucky enough to have one) pension payments also come on a regular monthly schedule. But unfortunately, it doesn’t work that way in our investment portfolios.

And that’s where monthly dividend stocks come into play.

Dividend stocks generally pay quarterly, and most bonds pay semiannually, or twice per year. This has a way of making portfolio income lumpy, as dividend and interest payments often come in clusters.

Well, monthly dividend stocks can help smooth out that income stream and better align your inflows with your outflows.

“We’d never recommend buying a stock purely because it has a monthly dividend,” says Rachel Klinger, president of McCann Wealth Strategies, an investment adviser based in State College, Pennsylvania. “But monthly dividend stocks can be a nice addition to a portfolio and can add a little regularity to an investor’s income stream.”

Today, we’re going to look at 9 of the best monthly dividend stocks to buy. You’ll see some similarities across the selections. That’s because monthly dividend stocks tend to be concentrated in a small handful of sectors such as real estate investment trusts (REITs) and business development companies (BDCs). These sectors tend to be more income-focused than growth-focused and sport yields that are vastly higher than the market average.

But in a market where the yield on the S&P 500 is currently 1.7%, that’s certainly welcome.

The list isn’t particularly diversified, so it doesn’t make a complete portfolio. In other words, you don’t want to overload on monthly dividend stocks. But they do allow exposure to a handful of niche sectors that add some income stability, so take a look and see if any of these monthly payers align with your investment style.

Stag Industrial

  • Market value: $5.8 billion
  • Dividend yield: 4.6%

Monthly dividend payer Stag Industrial (STAG, $32.12) proactively benefits from the rise of internet commerce.

STAG invests in logistics and light industrial properties. You know those gritty warehouse properties you might see near the airport with 18-wheelers constantly coming and going? That’s exactly the kind of property that Stag Industrial buys and holds.

It’s a foregone conclusion that e-commerce is growing by leaps and bounds, and STAG is positioned to profit from it. Roughly 40% of Stag Industrial’s portfolio handles e-commerce fulfillment or other activity. In fact, Amazon (AMZN) is STAG’s largest tenant.

E-commerce spiked during the pandemic for obvious reasons. And as stores reopened, the effects of that initial spike dissipated somewhat. Still, the trend toward e-commerce is clear – and likely to stick around. We’re making a larger percentage of our purchases online, and that trend only goes one direction.

However, there’s still plenty of room for growth. As crazy as this might sound, just over 15% of retail sales are made online, according to the Census Bureau. Furthermore, the logistical space is highly fragmented, and Stag’s management estimates the value of their market to be around $1 trillion. In other words, it’s unlikely STAG will be running out of opportunities any time soon.

Stag Industrial isn’t sexy. But it’s one of the best monthly dividend stocks to buy, with plenty of growth in front of it. And its 4%-plus yield is competitive in this market.

This article was originally published on this site