Advertisement
Canada markets closed
  • S&P/TSX

    22,851.17
    -144.22 (-0.63%)
     
  • S&P 500

    5,588.27
    -78.93 (-1.39%)
     
  • DOW

    41,198.08
    +243.60 (+0.59%)
     
  • CAD/USD

    0.7308
    -0.0007 (-0.09%)
     
  • CRUDE OIL

    83.07
    +2.31 (+2.86%)
     
  • Bitcoin CAD

    88,363.55
    -353.48 (-0.40%)
     
  • CMC Crypto 200

    1,339.79
    -2.53 (-0.19%)
     
  • GOLD FUTURES

    2,463.00
    -4.80 (-0.19%)
     
  • RUSSELL 2000

    2,239.67
    -24.00 (-1.06%)
     
  • 10-Yr Bond

    4.1460
    -0.0210 (-0.50%)
     
  • NASDAQ

    17,996.92
    -512.42 (-2.77%)
     
  • VOLATILITY

    14.48
    +1.29 (+9.78%)
     
  • FTSE

    8,187.46
    +22.56 (+0.28%)
     
  • NIKKEI 225

    41,097.69
    -177.39 (-0.43%)
     
  • CAD/EUR

    0.6677
    -0.0031 (-0.46%)
     

This 8% Dividend Stock Pays Cash Every Month

Pixelated acronym REIT made from cubes, mosaic pattern
Image source: Getty Images

Written by Sneha Nahata at The Motley Fool Canada

Investing in shares of dividend-paying companies can help you generate regular passive income, even when the market remains volatile. Fortunately, the TSX features several fundamentally strong companies with impressive dividend payment histories and growth potential, making them attractive choices for earning recurring passive income.

Take, for instance, Toronto-Dominion Bank (TSX:TD). This leading Canadian bank has been paying dividends uninterruptedly for about 167 years. On average, this financial services giant has increased its dividend by 10% since 1998. The bank’s commitment to returning higher cash to its shareholders shows its ability to grow earnings and the resiliency of its payouts.

ADVERTISEMENT

Similarly, Fortis (TSX:FTS) ) is another lucrative stock to start a passive income that will grow with you. This Canadian electric utility company has increased its dividend for 50 consecutive years. Further, the utility giant anticipates continuing this trend in the coming years.

While both these companies are undeniably great investments to start a passive income stream, I’ll restrict myself to a Canadian stock that offers the added advantage of monthly dividend payments and an attractive yield.

With this in the backdrop, let’s explore a stock that provides monthly cash.

A top stock for monthly cash

Canadians can turn to real estate investment trusts (REITs) for monthly income. Among top REITs, SmartCentres Real Estate Investment Trust (TSX:SRU.UN) appeals the most owing to the resilience of its payouts and ultra-high yield.

SmartCentres REIT boasts a high-quality real estate portfolio, which has proven resilient across various market conditions. The REIT has managed to sustain and even grow its distributions over the years, highlighting its operational strength and efficient asset management.

SmartCentres currently pays a monthly dividend of $0.154 per share, reflecting a yield of over 8.3% based on its closing price of $22.41 on July 9.

SmartCentres is a reliable dividend stock

SmartCentres’ monthly distributions are well-supported by a resilient real estate portfolio (high-traffic centres) that generates solid same-property net operating income (NOI). For instance, the REIT holds interests in 193 properties, including 155 retail properties. This higher mix of retail properties adds stability to its cash flows, drives its occupancy rate, and supports earnings.

SmartCentres also benefits from its high tenant retention rates and a top-quality tenant base, which includes leading North American retailers. Further, the REIT’s management highlighted during the first quarter (Q1) conference call that lease extensions or renewals remain strong, leading to rental increases. Moreover, its cash collection rate remained high at 99%.

While SmartCentres’ occupancy was temporarily reduced during the first quarter, the company is witnessing stronger leasing interest for its existing and newly built properties. This means that its occupancy rate is likely to improve quickly.

The REIT’s high-traffic properties, strong leasing demand, and solid occupancy bode well for future growth. Furthermore, the company’s strategic capital allocation and debt reduction are encouraging. Additionally, SmartCentres is focusing on developing mixed-use properties to tap into new growth opportunities. All these factors suggest that SmartCentres is poised to enhance its shareholders’ value through regular monthly dividend payments.

Earn $154 per month

SmartCentres REIT is a reliable stock to earn monthly dividend income. The table below shows that investors can earn $154 in monthly cash by purchasing 1,000 shares of this REIT.

Company

Recent Price

Number of Shares

Dividend

Total Payout

Frequency

SmartCentres REIT

$22.41

1,000

$0.154

$154

Monthly

The post This 8% Dividend Stock Pays Cash Every Month appeared first on The Motley Fool Canada.

Should you invest $1,000 in Fortis right now?

Before you buy stock in Fortis, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Fortis wasn’t one of them. The 10 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $16,110.59!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*.

See the 10 stocks * Returns as of 6/20/24

More reading

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Fortis and SmartCentres Real Estate Investment Trust. The Motley Fool has a disclosure policy.

2024