Investing for monthly income is a strategy that never goes out of style. That’s especially true if you’re building a Tax-Free Savings Account (TFSA) or looking for a way to generate steady cash flow without selling shares. If I had $10,000 to put to work right now, I’d split it between three fantastic Canadian stocks that all offer monthly dividends. Those are Exchange Income (TSX:EIF), Granite Real Estate Investment Trust (TSX:GRT.UN), and Freehold Royalties (TSX:FRU). Each one covers a different part of the market, giving a nice balance of stability, growth potential, and juicy yields.
EIF
Let’s start with Exchange Income. EIF is a dividend stock that’s all about boring but beautiful businesses. It owns a mix of aviation services and manufacturing operations, most of which operate in niche markets with little competition. That means steady cash flow and pricing power, two things dividend investors love to see.
As of writing, EIF trades at about $50 per share. The dividend stock’s latest earnings show it brought in $2.7 billion in revenue over the past 12 months, along with net income of $121.2 million. Earnings per share (EPS) came in at $2.49, which nicely covers its monthly dividend payout of $0.22 per share. That works out to a yield of about 5.2%, which is not too shabby for a company that keeps growing through smart acquisitions and internal investments. EIF is the kind of stock that just quietly compounds in the background. This is exactly what you want for a monthly income portfolio.
Granite
Next up is Granite REIT. Granite specializes in industrial properties across North America and Europe, renting space to some of the world’s biggest and most reliable tenants. This includes logistics hubs, warehouses, and manufacturing facilities. These have become the backbone of today’s economy.
Granite’s stock price sits around $63 as of writing. Its 2024 results showed strong performance, with $568.64 million in revenue, marking healthy 9.1% growth year-over-year. Net income hit $360.6 million, and the REIT maintains a high occupancy rate that keeps cash flowing in. What makes Granite even more appealing is its monthly dividend of $0.2833 per unit, offering a forward yield of about 5.4%. Industrial real estate has proven to be resilient even through economic bumps, and Granite’s conservative balance sheet and quality properties make it a reliable income generator for the long haul.
Freehold
Rounding out the trio is Freehold Royalties, a dividend stock that might not be on every investor’s radar but probably should be. FRU owns royalty interests in oil and gas properties across Canada and the U.S. This means it gets paid a percentage of production revenue without having to worry about drilling costs or operating expenses.
This business model is incredibly efficient and cash-rich, especially when commodity prices are strong. As of writing, Freehold trades at about $11.85 per share. Its 2024 results were impressive, with $309.5 million in revenue and $149.5 million in net income. Earnings per share (EPS) came in at $1.00. Freehold pays a monthly dividend of $0.09 per share, giving it a very attractive yield of about 9.1% at writing. That kind of yield is hard to find these days, and Freehold’s asset-light business model helps it maintain payouts even if oil prices get a little rocky.
Bottom line
Splitting $10,000 equally between EIF, GRT.UN, and FRU would mean putting about $3,333 into each stock. Not only would this offer exposure to three different sectors. It would also smooth out the risks that come with investing in any single dividend stock or industry. Plus, because all three pay monthly, you’d start seeing cash hit your account regularly, which you could reinvest or use however you like.
Of course, no investment is completely risk-free. EIF depends on continued strength in aviation and manufacturing demand. Granite’s fortunes are tied to the health of the industrial real estate market, and Freehold’s revenue is influenced by energy prices. But all three dividend stocks have shown they can adapt and thrive over time – thereby making these excellent candidates for a long-term income-focused strategy.
