As Foolish investors know, dividend-paying stocks far outperform non-dividend-paying stocks over the long term. However, if you do not reinvest your dividends and receive your cheques in the mail to live off of, as many retirees do, then there is one major problem: our bills arrive monthly, but our dividend cheques arrive quarterly.
Fortunately, there are stocks out there that pay dividends on a monthly basis, making everything much easier.
With all of this in mind, let’s take a look at three high-yielding stocks that pay dividends on a monthly basis that you could buy today.
1. Enbridge Income Fund Holdings Inc.
Enbridge Income Fund Holdings Inc. (TSX:ENF) owns a diverse portfolio of energy infrastructure assets that are operated by Enbridge Inc., which is one of the leading energy delivery companies in North America. It currently pays a monthly dividend of $0.1555 per share, or $1.866 per share annually, giving its stock a 6.7% yield at today’s levels.
It is also important for investors to make three notes.
First, Enbridge Income Fund Holdings has raised its annual dividend payment for five consecutive years.
Second, its recent dividend increases, including its 10% increase in December 2015, which was effective for its January 2016 payment, puts it on pace for 2016 to mark the sixth consecutive year in which it has raised its annual dividend payment.
Third, the company has stated that it expects to grow its dividend by 10% annually through 2019, and it has a long-term target-payout ratio of 80% of its cash available for distribution.
2. Morguard REIT
Morguard Real Estate Inv. (TSX:MRT.UN) is one of the largest owners of commercial real estate in Canada with 50 retail, office, and industrial properties totaling approximately 8.8 million square feet of leasable space. It currently pays a monthly distribution of $0.08 per share, or $0.96 per share annually, giving its stock a 7.5% yield at today’s levels.
Investors must also note that Morguard REIT has maintained this monthly rate since March 2012, and its consistent funds from operations, including an adjusted $0.93 per share in the first nine months of fiscal 2015, should allow it to continue to do so going forward.
3. Superior Plus Corp.
Superior Plus Corp. (TSX:SPB) is a diversified business corporation with operations in the energy, specialty chemicals, and construction industries. It currently pays a monthly dividend of $0.06 per share, or $0.72 per share annually, giving its stock a 7% yield at today’s levels.
It is also important to note that Superior Plus has raised its annual dividend payment for two consecutive years. However, the company has stated that it expects adjusted operating cash flow per share in the range of $1.50-$1.80 in fiscal 2016, which is likely down from the $1.65-$1.85 per share it expects to generate in fiscal 2015, so I think it will simply maintain its current dividend rate going forward.
Which of these monthly dividend stocks should you buy?
Enbridge Income Fund Holdings, Morguard REIT, and Superior Plus can provide the monthly dividend income that your portfolio needs, so take a closer look and consider initiating positions in one of them today.