Having a reliable source of passive income can help you in difficult financial times. While there are several ways to achieve that goal, investing in Canadian dividend stocks could be one of the most flexible ways to earn passive income each month. With dividend investing, you can always increase or decrease the amount of monthly passive income you want to receive by adjusting your investments accordingly.
In this article, I’ll talk about two of the most affordable monthly passive income stocks you can buy on the TSX today.
Northland Power stock
Northland Power (TSX: NPI) is the first attractive monthly passive income stock you can consider buying in September 2023. This Toronto-headquartered power producer currently has a market cap of $5.9 billion, as its stock trades at $23.36 per share with around 37% year-to-date losses, making it look cheap to buy for the long term. At this market price, NPI offers an annualized dividend yield of 5.1% and distributes these dividend payouts every month.
Besides its well-established utility and efficient natural gas business, Northland Power makes the majority of its revenue from the offshore wind and onshore renewables segments. Geographically, its revenue is also well diversified, with the Netherlands, Germany, and Latin America being some of its key markets besides its home market, Canada.
In 2022, Northland posted a solid 322% YoY (year-over-year) jump in its adjusted earnings to $3.46 per share with the help of rising electricity production and revenue. In contrast, macroeconomic challenges have led to difficulties for global renewable power projects lately, also affecting Northland Power’s financial growth in the first half of 2023.
Nonetheless, its long-term growth outlook could remain largely unaffected by these temporary challenges, as the company continues to focus on new quality acquisitions in renewable energy and energy storage segments. This is one of the reasons why I find this Canadian monthly dividend stock undervalued to buy for the long term on the dip right now.
Sienna Senior Living stock
Sienna Senior Living (TSX: SIA) is another reliable monthly dividend stock you can buy today on the Toronto Stock Exchange. It has a market cap of nearly $818 million, as its stock currently trades at $11.24 per share with a minor 3.1% year-to-date gain. At the time of writing, SIA stock’s annualized dividend yield stood strong at 8.3%.
This Markham-based company provides a variety of independent and assisted living options to seniors in Canada and generates most of its revenue from the long-term-care business segment.
After COVID-19-driven challenges badly affected Sienna Senior Living’s business operations in 2020, its total revenue reflected strong gains in the next two years. For example, the company reported a strong 28.9% YoY jump in its 2022 revenue to $718.6 million.
Consistently improving operating fundamentals, partly due to recent rental rate increases and occupancy growth, drove its total adjusted revenue up by 12.3% YoY in the first half of 2023. In the long term, its financial growth trends are likely to improve further as expected significant increases in the seniors’ population in Canada should raise the demand for its services. These positive factors make SIA a great Canadian monthly passive-income stock to buy now.
