For $1,000 in Monthly Passive Income, Buy 14,925 Shares of This Canadian Healthcare REIT

Investors looking to earn $1,000 in monthly dividend income can consider buying shares of Northwest Healthcare REIT in 2023.

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Investing in high-yield dividend stocks can help you earn a passive stream of income. A few TSX stocks also pay shareholders a monthly dividend, which can be used to pay your utility and gas bills. Alternatively, these payouts can be reinvested to buy additional shares of the company and benefit from a higher payout over time or to diversify your equity portfolio by purchasing other quality stocks.

One high-dividend stock trading on the TSX is NorthWest Healthcare REIT (TSX:NWH.UN). The real estate investment trust (REIT) operates in the healthcare sector, which is fairly recession resistant, allowing it to generate cash flows across economic cycles and maintain its dividend payout.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDTOTAL PAYOUTFREQUENCY
NorthWest Healthcare REIT$9.7214,925$0.067$999.975Monthly

NorthWest Healthcare pays investors a monthly dividend of $0.067 per share, indicating a forward yield of 8.3%. While the REIT has a juicy dividend yield, let’s see if the healthcare company should be part of your portfolio in 2023.

Is NorthWest Healthcare REIT a buy or sell right now?

Investing in NorthWest Healthcare Properties will provide you with access to several quality cash-generating assets in the Americas, Asia-Pacific, and Europe. In fact, NorthWest Healthcare invests and operates in some of the fastest-growing urban centres globally.

These properties include core infrastructure hospitals, ambulatory care centres, specialty hospitals, rehabilitation centres, and other healthcare-related assets.

Its base of tenants are hospital operators and healthcare practitioners who also benefit from direct or indirect government funding. NorthWest Healthcare explained, “The demand for our healthcare partners’ essential services, and the space to house these services, is expected to continue to increase with aging populations and increased urban migration.”

Similar to most other REITs, NorthWest Healthcare aims to grow via accretive acquisitions. It currently owns and operates 233 properties totaling 18.6 million square feet and enjoys an occupancy rate of 97%. It has more than 2,000 tenants with a weighted average lease expiry of 14 years, providing investors with enough visibility into the company’s earnings.

Why should you invest in this Canadian REIT?

NorthWest Healthcare ticks most of the boxes that income investors look for. It can be considered a defensive asset class with necessity-based tenancies. The majority of its clients enjoy government funding allowing the REIT to capitalize on strong healthcare trends.

In the first three quarters of 2022, NorthWest Healthcare reported revenue of $330.28 million compared to revenue of $278.2 million in the year-ago period. Its gross book value has increased to $8.28 billion at the end of the third quarter compared to $7 billion in December 2021.

NorthWest Healthcare also offers you an opportunity to diversify your portfolio, as it provides investors exposure to sectors such as real estate and healthcare. Typically, real estate investments, such as buying a house, requires huge amounts of capital and might generate annual yields of less than 5%. But this REIT offers you a much higher yield with a small amount of capital.

The Foolish takeaway

To earn $1,000 in monthly passive income, you would have to buy 14,925 shares of NorthWest Healthcare REIT, which would cost you a whopping $145,000. As dividend payouts are not guaranteed, it makes sense to identify similar high-yielding stocks and create a robust portfolio of income-generating companies.

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 Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool recommends NorthWest Healthcare Properties Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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