This 9.07% Dividend Stock Pays Cash Every Month

This dividend stock provides investors with long-term income without lifting a finger, and returns that are a deal right now.

Amy Legate-Wolfe

Author Bio

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband.

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Favorite Investment Quote

“October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published March 30, 2023 12:00 pm EDT

Monthly passive income is certainly something we could all use right now. But to be clear, passive income has to be passive in nature, and so many Canadians wrongly classify it. Passive income certainly isn’t a part-time job, a passion project, or anything that really makes you work for it. Which is why finding a dividend stock is the perfect option.

Finding a high-yielding, stable dividend stock then is the best way to create long-term passive income that you never have to work for. After reading this article and purchasing shares, you’ll see cash come in every single month.

But, of course, the key is to find that stable dividend stock. Which is why I’ve done the heavy lifting for you.

Doctor talking to a patient in the corridor of a hospital. — Source: Getty Images

The top dividend stock I’d choose

If you’re going to invest in a strong dividend stock long term, you need one that’s going to be around for decades. That means finding companies in industries that are pretty much guaranteed to be around. One of these industries is healthcare.

The healthcare sector is the perfect place to invest if you want long-term income. We’ll need healthcare no matter what happens in the years to come, after all. However, I’m not necessarily thinking you should invest in the next potentially big healthcare product. No, instead I would invest in a healthcare that will always be needed. Healthcare properties.

That’s why I recommend investing in NorthWest Healthcare Properties REIT (TSX:NWH.UN). The company has a diverse range of healthcare properties under its belt. Further, these are in locations all around the world, providing you with even more diversification.

Yet, even a real estate investment trust (REIT) can be iffy if it’s not supported by occupancies. Which is why again I like NorthWest stock. It’s a dividend stock supported by an average lease agreement of 14 years, as of writing, and a 97% occupancy rate. So you can look forward to income coming in for at least the next 14 years.

New and valuable

So why isn’t everyone and their cousin buying NorthWest stock? The company is still rather new, coming on the market in 2010. However, that can be used to your advantage. NorthWest stock is now trading in value territory at 7.6 times earnings, so you can lock up long-term, strong growth while the company is still relatively young.

What you’ll be getting are a few things. First, there’s the yield I mentioned for this dividend stock currently at 9.07%. Then, there’s the recovery. NorthWest stock should return to pre-fall prices. Right now, that’s a potential upside of 63%!

Finally, let’s see what all this combined could get you. First, if you invested $10,000 today, let’s see what passive income you will receive annually. Here is what the returns could turn your portfolio into.

COMPANY	RECENT PRICE	NUMBER OF SHARES	DIVIDEND	TOTAL PAYOUT	FREQUENCY	PORTFOLIO
NWH.UN – now	$8.60	1,163	$0.80	$930.40	monthly	$10,000
NWH.UN – highs	$14	1,163	$0.80	930.40	monthly	$16,282

Without even including the passive income, your returns should add $6,282 to your portfolio in the next year or so. Further, you’ll have locked in $930 in passive income, coming out at $77.53 each month.