As macroeconomic concerns have driven the Canadian stock market down in the last two quarters, monthly-paying dividend stocksâ popularity is increasing among investors. Indeed, economic cycles and stock market selloffs may also affect the share prices of such well-established dividend stocks. However, we shouldnât forget the fact that every big market selloff is followed by a strong market rally that lifts the share prices of most fundamentally strong stocks rather quickly. Thatâs why including such dividend stocks in your portfolio can minimize your risks.
In this article, Iâll highlight two reliable TSX dividend stocks you can add to your portfolio today with an investment of as little as $10,000 to earn monthly passive income.
Exchange Income stock
Exchange Income (TSX: EIF) is a Winnipeg-headquartered that focuses on making quality acquisitions primarily in the manufacturing, aerospace, and aviation industries. The company currently has a market cap of $2 billion as its stock trades at $43.56 per share. While its share prices have slipped by 17.2% in 2023 so far after rallying by 44% in the previous two years, these recent losses have made its dividend yield look even more attractive. At this market price, it offers a 5.7% annualized dividend yield and distributes its dividend payouts every month.
While the global pandemic-driven lockdowns and restrictions on travel and physical activity affected its operations in 2020, Exchange Income registered a solid financial recovery in 2022. As a result, its revenue in five years between 2017 and 2022 more than doubled to $2.1 billion. Despite facing pandemic-related and macroeconomic challenges in between, its adjusted annual earnings jumped by 27% in these five years to $3.13 per share. This reflects the companyâs ability to continue growing financially, despite adverse market conditions.
Besides its strong balance sheet and strong dividend-growth track record, Exchange Incomeâs continued focus on essential air services, aerospace, and precision manufacturing and engineering solutions segments make it a reliable monthly dividend stock to invest in for the long term.
Mullen Group stock
Mullen Group (TSX: MTL) is another trustworthy monthly-paying dividend stock that can help you create a reliable source of passive income for years to come. Similar to Exchange Income, this Okotoks-based group mainly focuses on acquiring businesses from logistics, warehousing, and specialized industrial services industries and strives to improve their performance. MTL currently has a market cap of $1.2 billion, as its stock trades at $13.29 per share after witnessing 8.7% value erosion on a year-to-date basis. Mullen has an annualized dividend yield of 5.4% at the current market price.
In the last decade, Mullen Group has tried diversifying its revenue streams by expanding its presence in the United States and international logistics segments. Although the recent slowdown in the global economy has affected the consumer environment in recent quarters, its diversified service offerings have helped the company minimize the slowdownâs impact on its financials. This is one of the main reasons why its adjusted earnings grew positively by 20% in the first half of 2023.
While economic challenges might hurt Mullenâs earnings growth trends in the short term, the consistently growing demand for quality logistic and warehousing services makes this monthly-paying dividend stockâs long-term growth outlook look bright.
