With inflation eating into your pockets, investing in monthly-paying dividend stocks would be an excellent strategy to reduce the impact. If you invest around $10,000 in each of the following three top monthly-paying dividend stocks, you can earn around $170 monthly. Let’s look at these three stocks in detail.
Pizza Pizza Royalty
Pizza Pizza Royalty (TSX:PZA) is one of the top monthly-paying dividend stocks to have in your portfolio due to its asset-light business model and stable cash flows. It operates Pizza Pizza and Pizza 73 brand restaurants through its franchisees. It collects royalties from franchisees based on their sales. So, its financials are less susceptible to rising commodity prices and wage inflation, thus delivering stable cash flows. Solid same-store sales and new restaurant openings have boosted its financials, allowing it to raise its dividends three times last year.
For April, PZA has announced a monthly dividend of $0.0775/share, with its forward yield currently standing at 6.88%. Meanwhile, the company has expanded its royalty pool by adding 45 new restaurants from the beginning of this year. However, it has removed 14 restaurants that ended their operations, thus increasing the restaurant count by 31 units to 774 this year. Besides, the company is constructing several restaurants that could increase its traditional restaurant count by 3 to 4% this year. So, I expect the company to have strong cash flow, thus allowing it to continue rewarding its shareholders at a healthy rate.
NorthWest Healthcare Properties REIT
Another high-yielding monthly-paying dividend stock that looks like an astute buy would be NorthWest Healthcare Properties REIT (TSX:NWH.UN). It owns and operates 219 healthcare properties across six countries. After being under pressure for some time, the company has seen some buying since the beginning of March, with its stock price rising by 27%. Its solid fourth-quarter performance and improving financial position amid divestment of non-core assets, slashing of dividends, and amendment and refinancing of its debt facilities have improved investors’ sentiments.
Despite dividend cuts, NorthWest Healthcare’s forward dividend yield stands at a healthy 7.14%. Besides, the company’s high occupancy and collection rates, inflation-indexed lease agreements, and a defensive healthcare portfolio stabilize its financials. Also, the company continues to trade at an attractive valuation, with its price-to-book multiple at 0.6.
Whitecap Resources
Although oil prices have cooled from this month’s highs, they are still trading around 14% higher for this year. The easing tension between Israel and Iran, the expectation of a ceasefire in the Middle East, and delays in rate cuts by the United States Federal Reserve have led to the cooling down of oil prices. Meanwhile, analysts predict oil prices will remain elevated in the near term, which could benefit oil-producing companies like Whitecap Resources (TSX:WCP).
Further, the company has planned to make capital investments of $900 to $1,100 million this year, strengthening its production capabilities. For this year, management projects its average production to be between 165,000 and 170,000 barrels of oil equivalent per day, with the midpoint of the guidance projecting a 7% increase from the previous year. In the long run, the company expects its average production to grow at an annualized rate of 5% to 210,000 barrels of oil equivalent per day by 2028. So, higher oil prices and increased production could boost its financials, thus allowing it to continue rewarding its shareholders with healthy dividends.
WCP currently offers a juicy forward dividend yield of 6.86% and trades at an NTM price-to-earnings multiple of 8.2, making it an attractive buy.
