3 Stocks That Cut You a Cheque Each Month

If you want dividend stocks that are going to pay you, with a strong future outlook, these are the three I’d watch for first and foremost.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published October 24, 2024 9:30 am EDT

When looking for the best monthly dividend stocks on the TSX, some stocks stand out for a combination of steady dividend payouts, financial stability, and promising outlook. And that’s exactly what we’re looking at today. Whether you’re after income stability or growth, these companies provide a compelling case for inclusion in your portfolio.

Slate Grocery

Slate Grocery REIT (TSX:SGR.UN) offers investors a unique opportunity with its focus on grocery-anchored retail properties in the U.S. The trust has performed admirably, with a forward annual dividend yield of 8.4% – one of the highest among Canadian Real Estate Investment Trusts (REIT).

Despite a challenging economic climate, Slate Grocery’s focus on essential services has allowed it to remain resilient. The company’s latest earnings report showed revenue of $209 million and a robust operating margin of 75.7%, thus demonstrating strong financial management. The management team, led by Blair Welch, continues to drive the strategy of acquiring recession-resistant properties. This sets it up for long-term success.

SmartCentres

SmartCentres REIT (TSX:SRU.UN) is another powerhouse when it comes to monthly dividend stocks – now boasting a forward annual dividend yield of 7.1%. With a market cap of $4.4 billion and consistent revenue growth, SmartCentres benefits from its Walmart-anchored retail properties and diversification into residential developments.

In its latest quarterly report, the dividend stock highlighted revenue of $939.9 million and a strong operating margin of 57.3%. The company has been actively pursuing development projects to drive growth. And the leadership team, including CEO Peter Forde, has been instrumental in navigating market uncertainties and positioning SmartCentres for future growth.

Sienna Senior Living

Finally, Sienna Senior Living (TSX:SIA) offers a more defensive play, focusing on the senior housing and long-term care sectors. Its current forward dividend yield stands at 5.4%, and it has shown resilience through its quarterly earnings. The latest report revealed quarterly revenue growth of 10.5% year-over-year, supported by improving occupancy rates.

As Canada’s aging population continues to grow, Sienna is well-positioned to benefit from increased demand for senior care services. Leadership under CEO Nitin Jain has proven adept at optimizing operations. And this is critical given the highly regulated nature of the healthcare industry.

Consistency is key

All three companies share a commitment to consistent monthly payouts, which is key for income investors. Slate Grocery has a solid history of maintaining and increasing its dividends, with its essential service properties providing a defensive moat against market fluctuations. Meanwhile, SmartCentres has paid dividends for more than a decade, continuously supported by its strong financials and diverse real estate portfolio. Sienna, while more focused on healthcare, has also maintained a reliable dividend history, thus appealing to those who seek stability in a defensive sector.

In terms of future outlook, all three companies are poised for continued success. Slate Grocery’s focus on recession-proof grocery-anchored properties should allow it to weather economic downturns. SmartCentres, with its ambitious development projects, is expected to increase its revenue streams beyond traditional retail, expanding into residential and mixed-use properties. Sienna Senior Living will likely continue to benefit from Canada’s aging demographics, thus positioning it for steady growth in the long-term care sector.

Bottom line

For investors seeking monthly income with long-term growth potential, Slate Grocery REIT, SmartCentres REIT, and Sienna Senior Living are among the best options on the TSX. The combination of strong financial performance, attractive dividend yields, and a promising future outlook makes them reliable choices for income-focused portfolios. As the market evolves, these companies remain well-positioned to deliver consistent returns to their shareholders.