The Canadian stock market recently reached its all-time highs amid growing hopes that the Bank of Canada will soon start cutting interest rates. However, if the central bank decides to hold interest rates elevated for an extended period due to persistent inflationary pressures, the market may witness another round of selloffs in the near term.
In such a volatile market environment, investors should look for ways to secure their future by minimizing risks to their investment portfolios. One of the best ways to secure your future could be by investing in monthly dividend stocks that can generate steady and reliable income for you. Monthly dividend stocks are great for investors who want to enjoy the benefits of compounding, as they can reinvest their dividends more frequently and grow their wealth faster.
In this article, I’ll highlight two top Canadian monthly dividend stocks you can buy in 2024 and hold for the long term.
Boardwalk REIT stock
Boardwalk REIT (TSX: BEI.UN) is a Calgary-headquartered open-ended real estate investment trust (REIT) that owns and operates a strong portfolio of multifamily rental communities across Canada, with 29 million net rentable square feet of area. It currently has a market cap of $3.6 billion as its stock trades at $72.52 per share after surging by 25.5% in the last year. At this market price, the REIT pays $0.12 per share of monthly dividends to investors, translating into $1.44 per share in annual dividends.
While many investors may not find Boardwalk REIT’s around 2% annualized dividend yield very attractive, its strong long-term financial growth prospects, which give it the possibility of increasing dividends in the future, make this Canadian monthly dividend stock a good option to consider now.
Interestingly, Boardwalk’s total revenue in the last five years has gone up by 26%, from $434.6 million in 2018 to $545.7 million in 2023, despite facing pandemic-related and other macroeconomic challenges in between. Last year, the REIT registered a strong 15% year-over-year jump in its annual funds from operations to $3.60 per unit, while its operating margin expanded to around 61%. Moreover, Boardwalk REIT’s strong financial position, strong execution, and focus on cost containment initiatives make its growth outlook bright.
Exchange Income stock
Exchange Income (TSX: EIF) is another reliable monthly dividend stock you can buy in Canada today. This Winnipeg-based company primarily focuses on quality acquisitions in manufacturing, aerospace, and aviation segments. It currently has a market cap of $2.2 billion as its stock trades at $46.66 per share with 3.5% year-to-date gains. EIF stock offers an attractive 5.7% annualized dividend yield at the current market price and distributes its dividend payouts every month.
Its consistent focus on value acquisition opportunities has helped Exchange Income more than double its annual revenue in the last five years, from around $1.2 billion in 2018 to $2.5 billion in 2023. Overall, the company has a strong financial future because of its prudent acquisition strategy and solid balance sheet that can support its growth plans. That’s why I expect its share prices to appreciate in value over the long term.
