Afraid of a Recession? Buy This 1 TSX Stock to Earn $300 in Monthly Passive Income in 2023

Here’s a safe TSX monthly dividend stock that can help you earn passive income, despite recession worries in 2023.

| More on:
protect, safe, trust

Image source: Getty Images

The year 2023 has started on a strong note, as the TSX Composite Index inched up by 5% in the first two weeks of the year after sliding by nearly 9% last year. While the beginning of the year looks impressive, the ongoing macroeconomic uncertainties due to inflationary pressures and a higher interest rate environment have raised the possibility of a looming recession.

As these broader concerns might keep the stock market highly volatile in the short term, it makes sense for you to add some safe, low-volatility TSX dividend stocks to your portfolio, which can give you healthy monthly passive income, irrespective of the economic cycle. In this article, I’ll highlight one of the best TSX dividend stocks you can buy in Canada that can help you earn $300 in monthly passive income in 2023 and beyond.

A safe TSX monthly dividend stock to buy in 2023

Whether you’re a stock market beginner or an experienced investor, it’s nearly impossible for anyone to perfectly time the market. That’s why I recommend that you should focus on analyzing a stock’s underlying fundamentals and growth prospects before making your investment decision instead of trying to time the market. Following this rule can help you get strong returns from stock investing in the long term.

Based on underlying fundamentals and growth prospects, Mullen Group (TSX:MTL) could be a great TSX monthly dividend stock to consider in 2023. If you don’t know about it already, it’s one of the largest logistics companies in North America. Its diverse logistics services include transportation and warehousing, mainly used by the energy, mining, construction, and forestry industries.

This Okotoks-headquartered company currently has a market cap of $1.3 billion, as its stock trades at $14.25 per share with a 2.1% loss in January after consistently rising in the previous three years. At this market price, the TSX stock offers a 5.1% annual dividend yield and distributes its dividend payouts every month.

What makes it a reliable stock, despite recession worries

In 2022, Mullen Group’s financial growth significantly improved as rising prices for its services boosted its profitability, despite inflationary pressures. While it’s yet to report fourth-quarter results, the company’s total revenue rose 20% YoY (year over year) in the September quarter to $518.4 million. With the help of higher pricing, its adjusted quarterly earnings jumped by 117% YoY to $0.39 per share. As its financial growth improved last year, Mullen tried to strengthen its financial position.

The Canadian logistics company recently revealed its 2023 business plan and budget, which clearly reflects that its financial growth might slow down a bit YoY due to macroeconomic challenges. Nonetheless, its well-diversified revenue streams and strong financial position should help it survive through tough economic times.

Moreover, Mullen Group plans to focus on cost reduction and new acquisition opportunities to expand its market share in 2023. I expect these efforts to help the company maintain healthy margins and further boost its long-term growth outlook, making it a reliable stock to buy in 2023.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDTOTAL PAYOUTFREQUENCY
Mullen Group$14.255,000$0.06$300Monthly
Prices as of Jan. 16, 2023

Bottom line

If you want to earn $300 in monthly passive income from Mullen Group’s dividends, you can buy 5,000 of its shares right now. However, you’ll have to invest a big sum of money ($71,250) in its stock to buy these many shares at the current market price. While this example aims to explain how you can keep earning monthly passive income from dividend investing, despite recession worries in 2023, you must not forget to diversify your portfolio to minimize your risks by including more such stocks in it.

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 has positions in and recommends Mullen Group. The Motley Fool has a disclosure policy. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

More on Dividend Stocks

A worker drinks out of a mug in an office.
Dividend Stocks

1 Dividend Stock to Buy if the Bank of Canada Keeps Cutting Rates 

This dividend stock is sure to benefit from ongoing cuts in the key interest rate and is already seeing some…

Read more »

A close up image of Canadian $20 Dollar bills
Dividend Stocks

How Much Cash Do You Need to Quit Work and Live Off Dividend Income

Toronto-Dominion Bank (TSX:TD) pays a lot of dividend income. Can you live off of it in retirement?

Read more »

An analyst uses a computer and dashboard for data business analysis and Data Management System with KPI and metrics connected to the database for technology finance, operations, sales, marketing, and artificial intelligence.
Dividend Stocks

Invest $10,000 in This Dividend Stock for $1,398.40 in Passive Income 

This dividend stock offers a whopping 11.9% dividend yield right now, with returns that should fly high for this cyclical…

Read more »

Person holds banknotes of Canadian dollars
Dividend Stocks

This 6.1 Percent Dividend Stock Is My Pick for Instant Income

Here’s what makes Transcontinental one of my top dividend stock picks right now for instant income.

Read more »

Pile of Canadian dollar bills in various denominations
Dividend Stocks

For a Shot at $5,000/Year in Passive Income, Buy 1,000 Shares of This TSX Stock

Do you know you can build passive income with TSX stocks? A $22,000 investment can give you a shot at…

Read more »

Paper Canadian currency of various denominations
Dividend Stocks

Beat the TSX With This Cash-Gushing Dividend Stock

A new Canoe EIT Income Fund (TSX:EIT.UN) investment could earn almost 9% yield annually, and the monthly dividend stock has…

Read more »

RRSP (Registered Retirement Savings Plan) on wooden blocks and Canadian one hundred dollar bills.
Dividend Stocks

RRSP Wealth: 2 Great Dividend Stocks to Own for Total Returns

Dividend stocks like Fortis Inc (TSX:FTS) can be great additions to a well-diversified portfolio.

Read more »

edit Sale sign, value, discount
Dividend Stocks

3 Cheap Stocks to Add to Your TFSA Before They Get Expensive

The stock market has some lucrative TFSA stocks trading at multi-year lows. Now is a good time to buy these…

Read more »