Create Your Own Pension With These 3 Monthly Dividend Stocks

Don’t have a pension? Don’t fret. Create your own by buying Artis Real Estate Investment Trust (TSX:AX.UN), Arc Resources Ltd. (TSX:ARX), and Pizza Pizza Royalty Corp. (TSX:PZA).

| More on:
The Motley Fool

If you’re employer doesn’t offer a pension plan, you don’t need to worry. You just need to take action by creating your own. You can do this by investing in stocks with high yields that pay their dividends on a monthly basis, so with this in mind, let’s take a look at three that you could buy today.

1. Artis Real Estate Investment Trust

Artis Real Estate Investment Trust (TSX:AX.UN) is one of the largest owners of commercial real estate in Canada and the United States with more than 250 retail, office, and industrial properties that total over 26 million square feet. It pays a monthly distribution of $0.09 per share, or $1.08 per share annually, which gives its stock a yield of about 9.2% at today’s levels.

It is also important for investors to note that Artis has maintained this annual dividend rate since 2009. However, I think its increased amount of funds from operations, including 5.4% year-over-year growth to an adjusted $0.97 per share in the first nine months of fiscal 2015, and its reduced payout ratio, including 83.5% in the first nine months of fiscal 2015 compared to 88% in the same period in fiscal 2014, could allow for a slight increase within the next few months.

2. Arc Resources Ltd.

Arc Resources Ltd. (TSX:ARX) is one Canada’s largest conventional oil and gas companies. It pays a monthly dividend of $0.10 per share, or $1.20 per share annually, which gives its stock a yield of about 6.6% at today’s levels.

Investors should also note that Arc Resources has maintained this annual dividend rate since 2010, and I think its ample funds from operations, including $572.7 million, or $1.68 per share, in the first nine months of fiscal 2015, could allow it to continue to do so going forward.

3. Pizza Pizza Royalty Corp.

Pizza Pizza Royalty Corp. (TSX:PZA) is the largest pizza restaurant chain in Canada with more than 700 locations across the country under its Pizza Pizza and Pizza 73 banners. It pays a monthly dividend of $0.0697 per share, or $0.8364 per share annually, which gives its stock a yield of about 6.6% at today’s levels.

Investors must also make two notes.

First, Pizza Pizza has raised its annual dividend payment for four consecutive years, and its recent increases, including its 1.9% increase in April 2015 and its 2.5% increase in November 2015, has it on pace for 2016 to mark the fifth consecutive year with an increase.

Second, the company has a target dividend payout of 100% of its adjusted earnings available for shareholder dividends, so I think its very strong growth, including 18.8% year-over-year growth to $15.2 million in the first nine months of fiscal 2015, and its reduced payout ratio, including 96.2% in the first nine months of fiscal 2015 compared to 102.5% in the same period in fiscal 2014, could allow for a slight increase within the next few months.

Should you create your own pension today?

Artis REIT, Arc Resources, and Pizza Pizza Royalty could form your homemade pension, so if you need to do so, take a closer look and consider buying at least one of them today.

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 Joseph Solitro has no position in any stocks mentioned.

More on Dividend Stocks