Passive Income: 4 Top TSX Stocks That Pay Dividends Monthly

Who doesn’t like the sound of a regular stream of passive income? Many energy stocks like Pembina Pipeline pay their dividends monthly.

Silver coins fall into a piggy bank.

Source: Getty Images

Like the sound of passive income?

If so, monthly-pay dividend stocks may be just the ticket. Most dividend stocks pay quarterly, but monthly-pay dividend stocks pay every single month. This can come in handy if you’re using your dividends to pay for daily living expenses. On that note, let’s explore four Canadian dividend stocks that reward you each and every month.

Pembina Pipeline

Pembina Pipeline (TSX:PPL)(NYSE:PBA) is a Canadian pipeline stock that has an attractive 5.4% dividend yield. The dividend is $0.21 paid out every month. As a pipeline company, PPL makes money by transporting oil and gas. It’s also involved in buying and selling oil and gas, and has a storage terminal located in Prince Rupert. Pipeline companies like PPL often have high yields. However, their payout ratios–the percentage of earnings paid as dividends–are often over 100%. PPL’s payout ratio is only 91%, which means that its dividend payout is fairly safe compared to other pipelines.

Northland Power

Northland Power (TSX:NPI) is a utility company involved in wind, solar, and natural gas. It has a diverse portfolio of utilities and renewable power assets across North and Central America, Europe, and, soon, Asia, with particular expertise in developing and operating off-shore wind assets.

Its stock pays a $0.10 dividend every month, which works out to $1.20 per year. NPI stock trades for $44, so the dividend yield is 2.7%. Obviously this isn’t the highest yield on earth, but it could grow over time. Renewable energy is a very promising industry that the government wants to promote and reward. Renewable companies often enjoy lots of generous tax breaks and other benefits that help them pass value on to their shareholders. Plus, Northland has a very exciting development pipeline in place that should create long-term earnings and value for shareholders.

First National

First National (TSX:FN) is a Canadian mortgage lender that helps Canadians borrow money to buy homes. It partners with mortgage brokers, professionals who help people shop for affordable mortgages. Often, people find that their banks charge excessively high interest rates. Mortgage brokers can help by connecting them with specialist lenders like FN.

FN’s business is doing well this year. In the most recent quarter, its revenue grew 14%, even though its amount of new loans fell 10%. This goes to show how rising interest rates can help mortgage lenders even when housing market activity is falling. It currently offers a juicy dividend yield of 6.41%, working out to a monthly dividend of about $0.20 per share and an annual dividend of $2.35.

Northwest Healthcare

Northwest Healthcare Properties REIT (TSX:NWH.UN) is a Canadian Real Estate Investment Trust (REIT) with a 6% dividend yield that is paid monthly. Having a monthly dividend doesn’t differentiate NWH.UN from other REITs because many REITs have the same payment schedule.

What makes Northwest Healthcare special is its stability.

As a healthcare REIT, NWH.UN leases out office space mainly to healthcare providers in Canada and the EU. In both of these regions, healthcare is paid for by the government, so NWH.UN’s tenants have very stable cash flows. In 2020, when Mall REITs were seeing defaults left and right due to the pandemic, NWH.UN collected 97.5% of the rent it would collect in a typical year. It was a testament to the REIT’s resilience in the face of challenging times.

That’s not to say that NWH.UN is a mere “safety” asset, though. The REIT is aggressively investing in growth, currently working on a $760 million investment in the U.S.–its first ever foray into the country. This new investment could add to Northwest Healthcare’s income potential, and reward shareholders in the future.

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 Andrew Button has no position in any of the stocks mentioned. The Motley Fool recommends NORTHWEST HEALTHCARE PPTYS REIT UNITS and PEMBINA PIPELINE CORPORATION.

More on Dividend Stocks

grow dividends
Dividend Stocks

3 Canadian Stocks With a Real Chance of Doubling Your TFSA’s Value

Three outperforming Canadian stocks can help TFSA investors double their account balances.

Read more »

Hand writing Time for Action concept with red marker on transparent wipe board.
Dividend Stocks

3 No-Brainer Stocks I’d Buy Right Now Without Hesitation

At any given time, the market may have certain stocks that offer a powerful combination of reliability, potential, valuation, etc.,…

Read more »

money cash dividends
Dividend Stocks

This 8.39% Dividend Stock Can Pay $100 Cash Every Month

Consider investing in this monthly dividend stock at current levels to lock in high-yielding monthly distributions to create a good…

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

Here’s the Average TFSA Balance in 2024

The Bank of Montreal (TSX:BMO) says that the average TFSA balance is $41,510, far below the maximum.

Read more »

A glass jar resting on its side with Canadian banknotes and change inside.
Dividend Stocks

Investors: Here’s How to Make $1,000 Each Month in Retirement

Here's how you can easily make $1,000 in monthly passive income in retirement in Canada, without taking on too much…

Read more »

man touches brain to show a good idea
Dividend Stocks

3 No-Brainer TSX Stocks I’d Buy Right Now Without Hesitation

Three TSX stocks that continue to overcome massive headwinds and beat the market are no-brainer buys right now.

Read more »

calculate and analyze stock
Dividend Stocks

TFSA Investors: 2 Top TSX Dividend Stocks to Buy on a Dip and Hold Forever

These top TSX dividend stocks now offer attractive yields and big potential capital gains.

Read more »

grow money, wealth build
Dividend Stocks

1 Dividend Stock to Buy for Growth and Stay for a 5.5% Yield

This dividend stock has been rising higher, but more could certainly be on the way. Now is the time to…

Read more »