3 High-Yielding Monthly Dividend Stocks for Income Investors
Monthly dividend stocks are attractive for income investors who are looking for more frequent payouts. Most stocks that pay dividends do so on a quarterly or semi-annual schedule.
But monthly dividend stocks pay shareholders each month, for 12 payments per year.
And, there are many monthly dividend stocks with high yields. This article will discuss three of the top high yielding monthly dividend stocks today.
'The Monthly Dividend Company'
Realty Income (O) is a retail real estate focused REIT that has become famous for its successful dividend growth history and monthly dividend payments. Today, the trust owns thousands of properties. Realty Income owns retail properties that are not part of a wider retail development (such as a mall), but instead are standalone properties. This means that the properties are viable for many different tenants, including government services, healthcare services, and entertainment.
On August 5, Realty Income, known as The Monthly Dividend Company, announced its operating results for the three and six months ended June 30, 2024. For the second quarter, Realty Income reported net income available to common stockholders of $256.8 million, or $0.29 per share. Adjusted Funds from Operations (AFFO) per share increased by 6.0% to $1.06 compared to the same quarter in 2023.
The company invested $805.8 million during the quarter at an initial weighted average cash yield of 7.9% and achieved a rent recapture rate of 105.7% on properties re-leased. Post June 30, 2024, Realty Income entered ATM forward agreements for 8.3 million shares, expected to generate net proceeds of approximately $447.8 million, with 3.7 million shares executed in July 2024. FFO for the second quarter was $929.1 million, or $1.07 per share, compared to $688.0 million, or $1.02 per share, in 2023.
Realty Income does not generate overly high funds-from-operations growth rates on a per-share basis, but the growth that the REIT is experiencing has been very steady, coming almost every year at a mid-single digits CAGR. As a result, the REIT has been able to grow its AFFO per share and its dividend per share for many years and is today a Dividend Aristocrat, meaning it has raised its dividend for at least 25 years in a row.
Realty Income generates its growth through growing rents at existing locations, via contracted rent increases or by leasing properties to new tenants at higher rates, but also by acquiring new properties. Realty Income expects to increase its investments in international markets moving forward.
O stock currently yields 4.9%.
Take a Walk Along Main Street
Main Street Capital Corporation (MAIN) is a Business Development Company (BDC) that provides long-term debt and equity capital to lower middle market companies and debt capital to middle market companies. Main Street defines lower middle market companies as generally having annual revenues between $10 million and $150 million. The company’s investments typically support management buyouts, recapitalizations, growth financings, refinancing, and acquisitions.
At the end of second-quarter 2024, Main Street had an interest in 83 lower middle market companies (valued at $2.4 billion), 19 middle market companies ($184 million) and 92 private loan investments ($1.7 billion). On May 7, 2024, Main Street Capital announced a 2.1% dividend increase to $0.245 per share paid monthly.
On August 8, Main Street Capital reported second-quarter 2024 results. Net investment income of $87.3 million for the quarter was a 2% increase compared to $85.7 million in Q2 2023. The corporation generated net investment income per share of $1.01, down 5% year over year from $1.06 per share. Distributable net investment income per share totaled $1.07, down 4% from $1.12 in Q2 2023.
Main Street’s net asset value per share increased compared to December 31, 2023, from $29.20 to $29.80, a 2.1% increase. The corporation declared monthly dividends of $0.245 to be paid in the fourth quarter of 2024, which are 4.3% higher than those declared a year ago, as well as a supplemental $0.30 dividend to be paid in September.
As of the end of the second quarter 2024, the corporation had aggregate liquidity of $946 million, consisting of $31 million in cash and cash equivalents, and $915 million of unused capacity under the revolving credit facility.
The company pays a monthly dividend, currently sitting at $0.24 or $2.88 on an annual basis, along with supplemental dividends (skipped in 2020 due to COVID-19). The upcoming supplemental dividend amounts to $0.30 per share to be paid in September, while the company keeps its trend of increasing the regular monthly dividend slightly every year. The supplemental dividends have been a result of generating realized gains from Main Street’s equity investments.
MAIN currently yields 5.6% based on its regular monthly payouts.
Coming to an Agreement on Dividends
Agree Realty Corp. (ADC) is an integrated real estate investment trust (REIT) focused on ownership, acquisition, development, and retail property management. Agree has developed over 40 community shopping centers throughout the Midwestern and Southeastern United States. At the end of December 2022, the company owned and operated 1,839 properties located in 48 states, containing approximately 38.1 million square feet of gross leasable space.
The company's business objective is to invest in and actively manage a diversified portfolio of retail properties net leased to industry tenants. Agree Realty has a market capitalization of $7.2 billion, and the company has been paying a growing dividend for 11 consecutive years.
On July 23, Agree Realty Corp. reported second-quarter results for 2024. The company reported strong financial performance for the second quarter of 2024, reflecting significant growth in key metrics.
The company invested $203 million in 70 retail net lease properties and initiated five development projects with $19 million in committed capital. Net income per share for the quarter rose by 25.6% to $0.52, and Adjusted Funds from Operations (AFFO) per share increased by 6.4% to $1.04.
The company also declared a monthly dividend of $0.250 per common share, marking a 2.9% year-over-year increase. Additionally, a $450 million bond offering was completed, contributing to a robust liquidity position of $1.7 billion.
For the first half of 2024, Agree Realty demonstrated consistent growth, with net income per share increasing by 11.3% to $0.95, and AFFO per share up by 5.5% to $2.07. The company invested $343 million in 102 retail net lease properties and committed over $101 million to 25 development projects. Monthly cash dividends declared during the first half totaled $1.491 per common share, reflecting a 2.9% increase from the previous year.
The company's financial results highlight a well-positioned balance sheet with a net debt to recurring EBITDA ratio of 4.1 times. Looking ahead, Agree Realty raised its 2024 AFFO per share guidance to a range of $4.11 to $4.14 and increased its acquisition guidance to approximately $700 million.
Agree Realty also has a solid balance sheet. The company has a BBB credit rating from S&P and a debt-to-equity ratio of 0.5. With a dividend payout ratio of 73% for 2024, ADC’s dividend is secure.
ADC stock currently yields 4%.
At the time of publication, Ciura had no positions in any stocks mentioned.