For Steady Income Each Month, Buy 650 Shares of This TSX Stock

Make $100 per month with its dividend-paying stock. The stock offers a high yield of over 7%.

| More on:
money cash dividends

Image source: Getty Images

The economy turned out better than many expected in 2023, significantly lifting beaten-down growth stocks. Further, easing inflation and an anticipated stabilization in interest rates supported the recovery in stocks. However, the economic uncertainty continues to keep the market volatile. Nonetheless, investors can still make steady income each month via fundamentally strong dividend-paying stocks, regardless of where the market moves.

While the TSX has several top-quality, dividend-paying companies that have been consistently paying and growing their dividends, I’ll focus on the one that offers a monthly payout and compelling yield near the current levels. Notably, a dividend stock offering monthly payouts enhances your overall income. Further, a reinvestment t of the dividends will help investors buy additional shares, enhancing overall returns in the long term. 

Against this backdrop, let’s look at a high-quality Canadian dividend stock that pays cash each month. 

The top monthly-paying stock

Before discussing the monthly-paying stock, it is important to highlight that dividend payments are never guaranteed. Thus, investors looking for reliable monthly income must diversify their portfolios and invest in multiple stocks to lower future disappointments.

Returning to the top monthly-paying stock, one could consider investing in SmartCentres Real Estate Investment Trust (TSX:SRU.UN). It operates as a REIT (real estate investment trust) and is famous for its lucrative payouts. REITs generally offer higher payouts, making them an ideal investment for generating a steady income. 

SmartCentres is Canada’s leading fully integrated REIT. The firm owns $11.7 billion worth of assets and operates an attractive portfolio of 188 strategically located properties. Overall, it owns 34.8 million square feet of income-producing retail and first-class office space, which supports its monthly payouts. 

SmartCentres REIT pays a reliable and growing dividend to its shareholders. Meanwhile, its payout ratio of over 90% remains stable. The company pays a monthly dividend of $0.154 per share, translating into a compelling yield of 7.36% (based on its closing price of $25.14 on July 21).

What makes SmartCentres a reliable monthly income stock?

SmartCentres’s differentiating factors are its high-quality rental space that benefits from stable and large tenants and its industry-leading occupancy rate. For instance, most of its tenants provide essential services and own large businesses. Some of its top tenants include WalmartMetro, and Dollarama. Thanks to its high-quality tenants, SmartCentres enjoys a high occupancy rate of 98%. 

SmartCentres’s balance sheet remains strong, with most of its debt being fixed rate. The high proportion of fixed-rate debt safeguards SmartCentres against a higher interest-rate environment. 

Bottom line  

Overall, SmartCentres, with its solid tenant base and high occupancy rate, is well positioned to grow its assets and dividend payments in the coming years. 

CompanyRecent PriceNumber of SharesDividendTotal PayoutFrequency
SmartCentres REIT$25.14650$0.154$100.16Monthly
Prices as of 07/21/23

The table above shows that if you buy about 650 shares of SmartCentres REIT right now, you can earn $100 in passive income every month. To buy 650 shares of SmartCentres REIT near the current market price, one would have to invest about $16.35K.

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 Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends SmartCentres Real Estate Investment Trust and Walmart. The Motley Fool has a disclosure policy.

More on Dividend Stocks

dividends grow over time
Dividend Stocks

1 Magnificent Dividend Stock That’s Down 10% and Trading at a Once-in-a-Decade Valuation

This dividend stock may be down around 10%, but there is a huge future opportunity for those wanting growth as…

Read more »

Canada national flag waving in wind on clear day
Dividend Stocks

RRSP Must-Haves: 2 Canadian Stocks to Secure Your Future

The TSX’s dividend pioneer and first Dividend King are must-haves in an RRSP to ensure financial security in retirement.

Read more »

stock research, analyze data
Dividend Stocks

How Much to Invest to Get $500 in Dividends Every Month

TSX dividend stocks such as Enbridge, TD Bank, and Telus, can help you earn $500 in monthly dividend payments.

Read more »

Golden crown on a red velvet background
Dividend Stocks

Dividend Powerhouses: Canadian Stocks to Fuel Your Portfolio

These two top Canadian dividend aristocrats are some of the top stocks on the TSX to buy now and hold…

Read more »

Dial moving from 4G to 5G
Dividend Stocks

This Undervalued Dividend Stock is Worth Buying Right Now

Want an undervalued dividend stock with long-term potential and a juicy yield? Here's an option you may regret not buying…

Read more »

A worker gives a business presentation.
Dividend Stocks

1 Stock I’m Buying Hand Over Fist in July Despite the Market’s Pessimism

This top dividend stock is going through a rough patch, but don't let that count out all the growth we've…

Read more »

person on phone leaning against outside wall with scenic view at airbnb rental property
Dividend Stocks

2 TSX Stocks Poised to Have a Big Summer

Restaurant Brands International (TSX:QSR) stock and another darling that could be too cheap to ignore this summer.

Read more »

HIGH VOLTAGE ELECRICITY TOWERS
Dividend Stocks

Forget Fortis Stock: Buy This Magnificent Utilities Stock Instead

Looking for high dividends and returns? Then I'm sorry, but Fortis (TSX:FTS) stock probably isn't for you.

Read more »