In this article, we discuss 10 monthly dividend stocks to buy and hold forever. You can skip our detailed analysis of dividend stocks and their performance over the years, and go directly to read 5 Monthly Dividend Stocks To Buy and Hold Forever.
In recent times, dividend stocks have become increasingly popular, mainly due to the rising significance of having cash on hand. This surge in interest stems from various factors, including concerns about inflation, unpredictable economic circumstances, and shifts in market sentiment. These uncertainties have prompted investors to adopt a more cautious approach when considering stocks that generate income. As a result, dividend stocks, which offer regular payouts to shareholders, have garnered attention as a potentially more stable and reliable option in these uncertain times. The appeal of regular payments becomes even more enticing when they arrive on a monthly basis. This preference for monthly dividend stocks is driven by the consistent and more frequent cash flow they offer investors.
Dividend growth is a key focal point for investors when considering dividend stocks. Investors keen on dividend stocks prioritize companies that consistently increase their dividend payouts over time. This growth signifies a company's financial health and stability. Companies that raise dividends regularly demonstrate their confidence in future earnings and commitment to sharing profits with shareholders. Analysts have always advised investors to focus on companies that consistently grow their payouts. Wolfe Research has expressed a preference for high dividend growth strategies, considering them particularly favorable. According to their assessment, this strategy has emerged as the most successful dividend approach in 2023. During periods of economic slowdown or deceleration, finding companies exhibiting consistent dividend growth becomes a challenge. However, Wolfe Research noted that companies boasting both high dividend growth rates and substantial free cash flow yields have historically outperformed others in similar economic scenarios. Because of these factors, people invest in dividend stocks.
Given the strong preference among investors for dividend-paying stocks, companies in the US have focused on maintaining stability in their dividend payments. Our article referred to Janus Henderson’s report and highlighted that during the third quarter of 2023, a significant majority of US companies that regularly distribute dividends either raised their payouts or maintained them at existing levels. As a result, there was a notable increase of 4.5% in the overall cash these companies distributed to their shareholders. The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP) are some of the major dividend players in the market, having raised their payouts consistently for decades. However, we will discuss some of the best dividend stocks that offer monthly dividends to shareholders.
For this list, we reviewed companies providing monthly dividends to their shareholders. Among these, we specifically chose businesses with robust dividend practices, consistently maintaining their payouts across multiple years. The majority of these selected companies operate within the Real Estate Investment Trust (REIT) sector, as they are mandated to allocate 90% of their income towards dividends. The stocks are ranked in ascending order of the number of hedge funds having stakes in them, according to Insider Monkey’s database of Q3 2023.
Ellington Financial Inc. (NYSE:EFC) operates as a specialty finance company primarily involved in acquiring and managing mortgage-related and other financial assets. On November 29, the company announced an interim monthly dividend of $0.06 per share. Additionally, the company anticipates that it will declare its remaining dividend for December following its regular schedule or in the usual manner. The stock's annual dividend yield comes in at 13.79%, as of November 30.
In the third quarter of 2023, Ellington Financial Inc. (NYSE:EFC) reported revenue of $96.22 million, which showed a 22.4% growth from the same period last year. The company's net income attributable to common shareholders came in at $6.6 million. It is among the best dividend stocks on our list that offer monthly dividends. In addition to EFC, investors are favoring dividend growth stocks like The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP).
The number of hedge funds in Insider Monkey's database owning stakes in Ellington Financial Inc. (NYSE:EFC) grew to 9 in Q3 2023, from 6 in the previous quarter. The consolidated value of these stakes is over $33.8 million. Among these hedge funds, Ellington was the company's leading stakeholder in Q3.
9. PennantPark Floating Rate Capital Ltd. (NYSE:PFLT)
Number of Hedge Fund Holders: 9
PennantPark Floating Rate Capital Ltd. (NYSE:PFLT) is an American business development company that primarily focuses on providing financing solutions to middle-market companies. In its fiscal Q4 2024, the company reported a total investment income of $34.7 million, up from $28.7 million in the same period last year. Its net investment income for the quarter came in at $18.5 million. The company ended the quarter with over $100 million available in cash and cash equivalents.
PennantPark Floating Rate Capital Ltd. (NYSE:PFLT) currently offers a monthly dividend of $0.1025 per share and has a dividend yield of 10.77%, as of November 30. It is one of the best dividend stocks on our list as the company has been making uninterrupted dividend payments to shareholders since 2016.
At the end of Q3 2023, 9 hedge funds in Insider Monkey's database owned stakes in PennantPark Floating Rate Capital Ltd. (NYSE:PFLT), which remained unchanged from the previous quarter. The overall value of these stakes is more than $17.6 million.
LTC Properties, Inc. (NYSE:LTC) is an American real estate investment trust company that primarily focuses on investing in senior housing and healthcare properties in the US. The company has a 31-year run of paying dividends to shareholders and currently pays a monthly dividend of $0.19 per share. With a dividend yield of 7.03% as of November 30, LTC is one of the best dividend stocks on our list.
In the third quarter of 2023, LTC Properties, Inc. (NYSE:LTC) posted revenue of $49.3 million, which saw a 13.3% growth from the same period last year. The company had over $11.3 million in cash and cash equivalents at the end of the quarter, compared with $10.3 million nine months ago.
Insider Monkey's database of Q3 2023 indicated that 11 hedge funds owned stakes in LTC Properties, Inc. (NYSE:LTC), growing from 8 in the preceding quarter. The consolidated value of these stakes is nearly $10 million. Balyasny Asset Management was the largest stakeholder of the company in Q3.
Main Street Capital Corporation (NYSE:MAIN) is an American business development company that focuses on providing debt and equity financing to lower middle-market companies in the country. The company primarily targets privately owned companies that are smaller in scale but have growth potential.
Main Street Capital Corporation (NYSE:MAIN) reported a total investment income of $123.2 million in the third quarter of 2023, up 25.3% from the same period last year. The company ended the quarter with over $77 million in cash and cash equivalents, compared with $49 million at the end of December 2022.
Main Street Capital Corporation (NYSE:MAIN) currently offers a monthly dividend of $0.24 per share, having raised it by 2.1% in November. This was the company's third consecutive monthly increase and it has been paying supplemental dividends for nine consecutive quarters. The stock has a dividend yield of 6.80%, as of November 30. MAIN is one of the best dividend stocks on our list that offer monthly dividends to shareholders.
Main Street Capital Corporation (NYSE:MAIN) was a part of 12 hedge fund portfolios at the end of Q3 2023, the same as in the previous quarter, according to Insider Monkey's database. The collective value of stakes owned by these hedge funds is over $58.3 million.
EPR Properties (NYSE:EPR) is a Missouri-based real estate investment trust company. Its portfolio includes a diverse range of real estate assets primarily leased to tenants operating in the experiential industries. The company has been paying regular dividends to shareholders since 1997 and currently offers a monthly dividend of $0.275 per share. The stock's dividend yield on November 30 came in at 7.40%.
In the third quarter of 2023, EPR Properties (NYSE:EPR) reported revenue of $189.3 million, which saw a 17.3% growth from the same period last year. Not only this, the revenue also beat analysts' estimates by $25.7 million. The company ended the quarter with over $173 million available in cash on hand.
Though monthly dividend stocks like EPR are all the range among investors, analysts advise diversifying portfolios with different types of investments. The Procter & Gamble Company (NYSE:PG), Colgate-Palmolive Company (NYSE:CL), and PepsiCo, Inc. (NASDAQ:PEP) are some of the best dividend stocks that can be added to dividend portfolios for solid returns.
As of the close of Q3 2023, 15 hedge funds in Insider Monkey's database reported having stakes in EPR Properties (NYSE:EPR), compared with 19 in the preceding quarter. The overall value of these stakes is more than $153 million. Among these hedge funds, Waterfront Capital Partners was the company's leading stakeholder in Q3.
