The TSX Composite Index delivered a strong 18% return in 2024, thanks to cooling inflation and optimism about economic growth. However, as we step into 2025, the market faces renewed volatility amid uncertainties surrounding the new U.S. administration’s trade policies and their geopolitical impact. For long-term investors, this could be the right time to focus on dividend stocks that can provide consistent income and help stabilize your portfolio in uncertain markets.
But why settle for quarterly payouts when you can have cash flowing into your account every month? In this article, I’ll introduce you to a monthly dividend stock offering an outstanding 8% yield, as it could be a perfect pick for those who want to turn market volatility into an opportunity for steady income.
Source: Getty Images
A top monthly dividend stock to buy now
Whether you’re investing for income or looking to add stability to your portfolio, you should always pay attention to a company’s business fundamentals, financial growth prospects, and dividend track record before making an investment decision. Keeping that in mind, one TSX stock that stands out is NorthWest Healthcare Properties REIT (TSX:NWH.UN).
NorthWest is a unique player in the real estate market, specializing in the healthcare sector. Its portfolio includes a diverse mix of hospitals, medical office buildings, and clinics across North America, Brazil, Europe, and Australasia regions. The company generates income through long-term, inflation-indexed leases with healthcare operators, which gives it stable cash flows and largely predictable returns.
Focus on accelerating growth despite challenges
Currently, NorthWest’s stock is trading at $4.57 per share with a market cap of $1.1 billion. The real estate investment trust (REIT) offers an impressive annualized dividend yield of 8% and distributes these payouts every month. However, this monthly dividend stock has faced challenges of late, with a decline of 11.8% over the last year. This decline could mainly be attributed to macroeconomic factors like a high interest rate environment, which put pressure on real estate valuations.
In the third quarter of 2024, NorthWest’s total revenue slipped by 12% YoY (year over year) to $107 million. This drop was due to the sale of its non-core assets as it continued to focus on its portfolio streamlining strategy. Nevertheless, positive factors such as rent indexation and development-related revenue restricted the decline in its revenue.
On the brighter side, the REIT’s same-property net operating income grew by 5% YoY last quarter, showcasing strong underlying operational performance. Similarly, NorthWest’s global portfolio occupancy rate remained robust at 96.1%, reflecting its ability to maintain tenant relationships despite market challenges.
Top reasons to buy this stock now
In recent quarters, NorthWest has increased its focus on strengthening its balance sheet. The recent sale of its U.K. portfolio and other non-core assets generated proceeds of $1.3 billion, which it used to pay down high-interest debt. Moreover, the REIT’s focus on its core healthcare properties with simplified operations could help it accelerate financial growth trends in the coming years. Given these positive factors, NorthWest stock could be an attractive stock in today’s uncertain market scenario, especially for investors seeking stable monthly income and exposure to a defensive asset class.
