Get $500 in Monthly Passive Income With These 2 Stocks

RioCan Real Estate Investment Trust (TSX:REI.UN) and Morguard North American Residential Real Estate Investment Trust (TSX:MRG.UN) give investors the easiest way to make passive income.

| More on:
Simple life style relaxation with Asian working business woman healthy lifestyle take it easy resting in comfort hotel or home living room having free time with peace of mind and self health balance

Image source: Getty Images

Speaking from experience, there is nothing better than knowing that even if my stocks aren’t performing optimally, I’ll still be making money month after month.

That’s because I have a number of dividend stocks in my portfolio that continue to contribute to my investments.

With the right amount of money to put in your portfolio, those dividend stocks could give you a serious payout. Everyone can use an additional $500 per month, and these two real estate investment trusts (REITs) are a prime way to achieve that.

RioCan

RioCan REIT (TSX:REI.UN) has a diversified portfolio that should put an investor’s mind at ease that its shares won’t exactly tumble, even if the company were to lose a large client.

But to keep its books in check, the company is selling about $2 billion worth of its properties in secondary markets to repurchase trust units. This will be so the company can then finance developments in urban markets lying within Canada’s largest cities. Needless to say, as those investments start to produce funds, investors will see the cash go straight to their pockets.

Most recently, the trust had some good news, reporting $194.5 million in earnings for its latest quarter, with revenue at 324.1 million and funds from operations came in at $142.2 million.

That cash will come both in the form of share price increase and dividend increase. The current yield sits at 5.59%, or $1.44 annually, given out on a monthly basis.

Morguard

Morguard North American Residential REIT (TSX:MRG.UN) has risen about 25% in the last year, with sales rising as it takes advantage of both the Canadian and American economies for its portfolio. As the company continues to perform, it should have no problem paying out its annual dividend given its EPS of 5.11.

Most recently the company saw its earnings increase by 8.5%, though its debt remains high. However, the company has managed that by scaling back its massive operation, with net operating income going down 3.2% and net income rising to $73 million in the last year.

Right now, the company is a steal trading at half its book value, with a price-to-earnings multiple of about 10. The biggest steal, however, is its dividend of 3.85%, or $0.68 per share annually, paid out monthly.

How to get that $500?

It’ll take quite an investment, but if you’re willing and able to make it, you’ll easily get that $500 of monthly income.

Right now, you would need 2,083 shares to make $249.96 a month off of RioCan shares. That’s an investment of about $53,887.

On top of that, you would need to have 4,386 shares to make $250 a month from Morguard shares. That’s an investment of $78,684.

So, granted, in total you would need to spend $132,571 to make $500 per month, but at the end of the year, you’ll have an extra $6,000 waiting and ready for you to cash out or invest. On top of that, these stocks are likely to rise even higher over the next few years, making Morguard and RioCan two investments that should be hard to pass up.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned.

More on Investing

edit Woman in skates works on laptop
Dividend Stocks

3 No-Brainer Stocks to Buy Under $30

These three stocks all offer a huge deal for investors looking for dividends, as well as growth that will last.

Read more »

Business man on stock market financial trade indicator background.
Tech Stocks

1 Growth Stock Down 50 Percent to Buy Right Now

There are plenty of growth stocks in the market worth considering, but Shopify (TSX:SHOP) looks like one of the best…

Read more »

You Should Know This
Dividend Stocks

How to Convert a $300 Monthly Investment Into $338 in Monthly Income

If you want a certain amount in monthly passive income, invest a similar amount today and leave the rest to…

Read more »

Increasing yield
Dividend Stocks

3 Income Stocks With Big Yields to Consider in April 2024

If you haven’t yet made your March investments, here are three income stocks to buy the dip and lock in…

Read more »

Senior Man Sitting On Sofa At Home With Pet Labrador Dog
Dividend Stocks

RRSP Investors: Don’t Miss Out on This Contribution Hack!

This hack has so many benefits for you -- not just when you put it in your RRSP but for…

Read more »

edit Sale sign, value, discount
Stocks for Beginners

These 3 Growth Stocks Are on Sale and Set to Surge

Some growth stocks are on sale right now that offer massive long-term potential for investors. Here's a trio to consider…

Read more »

Cannabis grows at a commercial farm.
Cannabis Stocks

Why Canopy Growth Stock Could Double in 2024

Canopy Growth (TSX:WEED) stock saw its share more than double in the last two weeks. So, can it do it…

Read more »

Young woman sat at laptop by a window
Dividend Stocks

3 Dividend Stocks Everyone Should Own for the Long Haul

For investors looking for top-tier dividend stocks to buy and hold for the long term, here are three of my…

Read more »