If you’re interested in generating monthly income by investing in stocks, but can’t figure out where to begin, then this article is for you. I’ve compiled a list of three stocks with high and safe yields up to 6.8%, so let’s take a quick look at each to determine which would fit best in your portfolio.
1. Chemtrade Logistics Income Fund
Chemtrade Logistics Income Fund (TSX: CHE.UN) is one of North America’s leading providers of industrial chemicals and related services, including sulfuric acid, sodium nitrate, liquid sulfur dioxide, and spent acid processing services. It pays a monthly distribution of $0.10 per share, or $1.20 per share annually, which gives its stock a yield of about 6.8% at today’s levels.
Investors should also make two notes.
First, Chemtrade has maintained its current annual distribution rate since 2007.
Second, I think the company’s consistent generation of distributable cash after maintenance capital expenditures, including the $1.97 per share it generated in fiscal 2015, will allow it to continue to maintain its current annual distribution rate for the foreseeable future.
2. First National Financial Corp.
First National Financial Corp. (TSX: FN) is Canada’s largest non-bank lender, originator, and servicer of commercial and residential mortgages with more than $93 billion in mortgages under administration. It pays a monthly dividend of $0.129167 per share, or $1.55 per share annually, which gives its stock a yield of about 6.1% at today’s levels.
Investors should also make two notes.
First, First National has raised its annual dividend payment for four consecutive years, and its 3.3% hike in October 2015 has it on pace for 2016 to mark the fifth consecutive year with an increase.
Second, I think the company’s consistent growth of net income attributable to shareholders, including its 5.6% year-over-year growth to $1.71 per share in fiscal 2015, will allow its streak of annual dividend increases to continue going forward.
3. Smart REIT
Smart REIT (TSX: SRU.UN) is one of Canada’s largest REITs with 138 properties in operation and total assets of approximately $8.5 billion. It pays a monthly distribution of $0.1375 per share, or $1.65 per share annually, which gives its stock a yield of about 4.9% at today’s levels.
Investors should also make two notes.
First, Smart REIT has raised its annual distribution for two consecutive years, and its 3.1% hike in October 2015 has it on pace for 2016 to mark the third consecutive year with an increase.
Second, I think the company’s consistent growth of funds from operations, including its 8.2% year-over-year growth to $1.99 per share in fiscal 2015, will allow its streak of annual distribution increases to continue for the next several years.
