When you’re looking for a dividend stock that pays you to do absolutely nothing, few things are better than a reliable dividend. Even better is one that shows up every single month. If that sounds like your kind of retirement dream, then KP Tissue (TSX:KPT) might be worth a closer look. This Canadian company pays a high dividend and does so monthly, giving investors consistent cash flow and the kind of peace of mind that’s especially valuable in uncertain markets.
KPT
KP Tissue doesn’t manufacture products itself. Instead, it holds a 12.5% interest in Kruger Products, which is Canada’s leading maker of tissue products. Kruger Products owns household name brands like Cashmere, Purex, Scotties, and SpongeTowels. While people might cut back on luxuries during a recession, toilet paper and tissues are likely to stay on the grocery list. That kind of stability gives KP Tissue a built-in defensive quality.
As of May 2025, KP Tissue offers an annual dividend of $0.72 per share. With shares recently trading around $8, that puts the dividend yield close to 9%. That’s a standout figure on the TSX, especially for investors looking to lock in income. The dividend stock pays $0.18 every month, which means you get cash rolling into your account twelve times a year. Whether you’re reinvesting that income or using it to cover bills, it’s a useful flow of money.
Now, high yields often come with some caveats, and KP Tissue is no exception. In 2024, it posted a net income of $2.4 million, and its share of Kruger Products’s net income totalled $3.0 million. That tells us it’s still profitable, but it’s working with tight margins. Importantly, Kruger Products, the income source, had a solid year. Its revenue in 2024 was $2.05 billion, up 9.4% from the year before. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 11% to $264.8 million, showing that the operations behind the dividend are still moving in the right direction.
Looking ahead
Kruger has also been making efforts to improve production costs and efficiency. Its Sherbrooke plant, for example, has been ramping up production capacity since it opened and is helping the company reduce costs per unit. Meanwhile, inflationary pressures on raw materials and transportation have started to ease. All of this bodes well for future earnings and, by extension, dividend sustainability.
KP Tissue’s payout ratio sits around a whopping 300%, which means the dividend stock pays all of its earnings as dividends and then some. Investors should be aware that the stock itself tends to be relatively quiet in terms of price movement. It hasn’t seen the kind of big swings some tech stocks have, and it doesn’t come with the same growth expectations. What it offers instead is predictability and income. And for many investors, especially those planning for retirement, that’s the entire point.
A monthly dividend stock like KP Tissue can be helpful in smoothing out cash flow. Instead of receiving income quarterly like many other dividend stocks, monthly payers line up better with monthly expenses. That’s great if you’re using dividends to supplement pensions, Canada Pension Plan, or Registered Retirement Investment Fund withdrawals. It also means you get more frequent opportunities to reinvest those payments if you’re still in accumulation mode.
Bottom line
With inflation still high and interest rates taking a breather, dividend income is once again becoming a go-to for Canadian investors. And while you should always do your own due diligence, KP Tissue is certainly one to keep on your radar. It’s not every day you find a nearly 9% yield in a stock tied to a business most Canadians interact with on a daily basis, often without even thinking about it.
