Earn Over $375/Month by Investing in These 4 Canadian Dividend Stocks

TFSA investors: boost your passive income with these four Canadian dividend stocks.

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One of the crucial lessons the pandemic has taught us is to have secondary income, as many lost their jobs amid the pandemic-induced lockdowns. Notably, investing in monthly paying dividend stocks is a convenient and cost-effective means to earn passive income.

The TFSA (Tax-Free Savings Account) allows Canadian citizens to earn tax-free returns on a specified amount called a contribution room. For this year, the limit is set at $6,000, while the cumulative limit stands at $75,500. So, if you invest the entire cumulative amount in stocks that pay dividends over a 6% yield, you can earn above $375 per month. So, if you are ready, here are four monthly paying dividend stocks with yields of 6% and above.

Pembina Pipeline

Given its excellent track record and high dividend yield, Pembina Pipeline (TSX:PPL)(NYSE:PBA) is my first pick. Since 1997, the company has been paying dividends uninterrupted, thanks to its fee-for-service and take-or-pay contracts. These regulated assets generate over 90% of its adjusted EBITDA, thus providing stability to its earnings and cash flows.

Meanwhile, the economic growth amid expansionary economic policies and the easing of restrictions has increased energy demand, benefiting Pembina Pipeline. It has around $900 million of projects under construction. These investments and favourable market conditions could boost the company’s financials in the coming quarters. So, the company’s dividend is safe. Meanwhile, its forward dividend yield currently stands at an attractive 6.4%.

NorthWest Healthcare

My second pick is Northwest Healthcare REIT (TSX:NWH.UN). Thanks to its defensive healthcare properties, government-backed tenants, and long-term contracts, it enjoys high occupancy and collection rates. Meanwhile, the company is also working on acquiring the Australian Unity Healthcare Property Trust, which owns 62 healthcare facilities and enjoys a high occupancy rate of 98%.

NorthWest Healthcare has around $350 million of projects under construction or approved stage. These investments could boost its financials in the coming quarters, thus allowing it to continue paying dividends at a healthier rate. Currently, the company’s forward yield stands at a juicy 6%.

Pizza Pizza

Although the pandemic had severely dented the food-service industry, Pizza Pizza Royalty (TSX:PZA) has fared better, thanks to its highly franchised business and its investment in expanding its digital and delivery channels. So far this year, the company has outperformed the broader equity market, with its stock rising by 23.5%. Meanwhile, the uptrend could continue amid the easing of restrictions and improving economic activities.

The easing of restrictions could drive Pizza Pizza Royalty’s in-store sales and could allow it to reopen its non-traditional restaurants. Notably, after reporting a solid second-quarter performance last month, the company had raised its dividends by 9% to $0.06 per month, depicting its confidence in future earnings and cash flows. With its forward dividend yield currently standing at 6.34%, Pizza Pizza Royalty could be an excellent buy for income-seeking investors.


My final pick is Extendicare (TSX:EXE), which provides home healthcare services to around 81,000 senior residents across Canada. In its recently posted second quarter, its revenue and adjusted EBITDA grew by 9% and 54%, respectively. Meanwhile, the uptrend in the company’s financials could continue amid the increasing demand for its services due to the increasing aging population and rising income levels.

Meanwhile, Extendicare is also investing around $500 million to increase its capacity and replace its aged facilities. It has also raised the intake of its in-house training programs to 600 this year to meet the rising demand for skilled caregivers. So, these initiatives could boost its earnings and cash flows in the coming years. Meanwhile, the company currently pays a monthly dividend of $0.04 per share, with its forward yield standing at 6.08%.

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.

The Motley Fool owns shares of and recommends PIZZA PIZZA ROYALTY CORP. The Motley Fool recommends NORTHWEST HEALTHCARE PPTYS REIT UNITS and PEMBINA PIPELINE CORPORATION. Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned.

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