Payday ringed on a calendar
Investors seeking steady passive income could consider investing in dividend stocks. The primary reason is that several fundamentally strong companies consistently pay and increase their payouts, even when the economy didnât do well, thus returning higher cash to their shareholders.
For instance, companies like Fortis and Enbridge have been consistently growing their annual dividends for decades, regardless of the market conditions. Fortis has increased its dividend every year for 50 consecutive years, while Enbridge has done so for 29 years straight. This consistent performance makes these stocks appealing to people who want regular income from their investments.
While these stocks are undoubtedly solid income bets, Iâll focus on shares of a company that offers monthly payouts. Itâs worth noting that monthly dividends give investors more control over their cash flow. They can reinvest the money, use it for bills, or put it into other investments as they see fit.
With this background, letâs look at a top Canadian stock that pays monthly dividends.
A 7.7 % dividend stock paying cash every month
SmartCentres Real Estate Investment Trust (TSX:SRU.UN) is a top stock on the TSX, offering monthly payouts. As a REIT (real estate investment trust), SmartCentres distributes most of its earnings as dividends, making it an appealing stock for investors seeking passive income.
In addition, its high-quality assets, strong fundamentals, compelling yield, and a consistent track record of paying dividends and occasionally increasing the same contribute to my positive outlook on the stock.
The REIT currently pays a monthly dividend of $0.154 a share, translating to a dividend yield of approximately 7.7% based on its closing price of $24.08 on February 25.
Why invest in SmartCentres REIT?
The top reasons to invest in SmartCentres stock are its compelling yield and commitment to return cash to its shareholders. Furthermore, the REITâs payouts and high yield are well-protected by its resilient real estate portfolio that consistently generates strong same-properties NOI (net operating income) regardless of economic situations.
As of December 31, 2023, SmartCentres had ownership interests in 191 properties, including 155 retail properties. The higher mix of retail properties acts as the anchor to its cash flows and drives its occupancy rate, enabling the company to bolster its shareholdersâ return.
SmartCentres REIT boasts a high-quality tenant base and a high occupancy rate of 98.5%. Further, SmartCentres has mostly fixed-rate debt, which makes it relatively immune to the higher interest rate environment.
While the REIT is poised to deliver stable cash flows and maintain high occupancy across its retail portfolio, it will likely benefit from the development of mixed-use properties. SmartCentres has a solid development pipeline of mixed-use properties and a significant underutilized land bank, which presents strong growth opportunities. Overall, the company is well-positioned to continue to generate resilient income and grow funds from operations to support sustainable dividend distributions.Â
Bottom line
Investors seeking monthly passive income could consider SmartCentres REIT as a top stock. Its high yield, well-covered payouts, and commitment to deliver sustainable dividend distributions make it an appealing investment. Further, based on its monthly payouts, investors can make $154 per month by acquiring 1,000 shares of SmartCentres REIT stock near the current levels.
Just Released! 5 Stocks Under $50 (FREE REPORT)
Motley Fool Canada‘s market-beating team has just released a brand-new FREE report revealing 5 “dirt cheap” stocks that you can buy today for under $50 a share.
Our team thinks these 5 stocks are critically undervalued, but more importantly, could potentially make Canadian investors who act quickly a fortune.
Don’t miss out! Simply click the link below to grab your free copy and discover all 5 of these stocks now.
Claim your FREE 5-stock report now!
More reading
Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge, Fortis, and SmartCentres Real Estate Investment Trust. The Motley Fool has a disclosure policy.
News Related-
The best Walmart Cyber Monday deals 2023
-
Jordan Poole took time to showboat and got his shot blocked into the stratosphere
-
The Top Canadian REITs to Buy in November 2023
-
OpenAI’s board might have been dysfunctional–but they made the right choice. Their defeat shows that in the battle between AI profits and ethics, it’s no contest
-
Russia-Ukraine Drone Warfare Rages With Dozens Headed for Moscow, Amid Deadly Winter Storm
-
Trump tells appeals court that threats to judge and clerk in NY civil fraud trial do not justify gag order
-
Can Anyone Take Paxlovid for Covid? Doctors Explain.
-
Google this week will begin deleting inactive accounts. Here's how to save yours.
-
How John Tortorella's Culture Extends from the Philadelphia Flyers to the AHL Phantoms
-
Tri-Cities' hatcheries report best Coho return in years
-
Wild release Dean Evason of head coaching duties
-
Air New Zealand’s Cyber Monday Sale Has the 'Lowest Fares of 2023' to Auckland, Sydney, and More
-
NDP tells Liberals to sweeten the deal if pharmacare legislation is delayed
-
'1,000 contacts with a club': Tiger Woods breaks down his typical tournament prep to college kids in fascinating video