For many Canadians building a stock portfolio for the first time, the dream is to generate enough passive income to cover the bills, pad their lifestyle, or even retire early. But to turn that dream into a reality, you need more than just high yields. You need consistency, reliability, and a business model that holds up even when market winds shift. That’s where monthly dividend stocks could be a game-changer. These stocks not only offer payouts but also bring the peace of mind investors crave, especially when markets feel shaky.
In this article, I’ll talk about one such energy stock, Cardinal Energy (TSX: CJ), offering an impressive 8.2% annual dividend yield and paying investors in cash every single month. Let’s take a closer look at why it might be worth your attention right now.
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A top monthly dividend stock with an 8.2% yield to buy
Cardinal Energy’s strong cash flow, solid operations, and a long-term vision for growth make it a great stock for long-term income investors. As an oil and gas producer headquartered in Calgary, it operates across Alberta, Saskatchewan, and British Columbia. The company mainly focuses on low-decline conventional oil and has recently expanded into thermal production.
Investor confidence and progress on its growth projects have helped CJ stock rally more than 42% over the last six months. As a result, the stock now trades at $8.77 per share with a market cap of around $1.4 billion. What’s even more attractive is its 8.2% annualized dividend yield, paid out monthly.
A recent dip in numbers, but operations remain robust
In the third quarter, Cardinal posted adjusted funds flow of $47.3 million, down from $65.7 million a year earlier. This YoY (year-over-year) decline was mainly due to lower realized commodity prices and slightly reduced production levels. The company’s net profit in the latest quarter also dropped on a YoY basis, as higher interest costs and ongoing project investments weighed on the bottom line.
Despite a drop in its quarterly earnings, Cardinal’s long-term strategy seems to be gaining ground. Recently, the company completed the construction of its first thermal project in Reford, Saskatchewan, on time and on budget, and has already moved into the production ramp-up phase. Even with short-term earnings pressure, this big milestone is likely to have a big impact on reshaping the company’s future cash flow.
Laying the groundwork for monthly income growth
Despite temporary pressures, Cardinal isn’t just keeping dividends stable but also laying the groundwork for delivering sustainable income for years to come. Its Reford steam-assisted gravity drainage project, which began first steam in August, is expected to add around 6,000 barrels per day to its production in early 2026. That would be a notable bump for a company with just over 20,000 barrels per day in current output.
Reford alone is expected to significantly improve its adjusted funds flow next year. With a total project life of more than 20 years, strong free cash flow, and a solid payout timeline, it could boost the company’s outlook for income and capital appreciation.
Beyond that, Cardinal is already working on future thermal projects, with a second one already in the pipeline. Overall, its plan to grow thermal production, paired with its low-decline conventional assets, could make its monthly dividends even more sustainable in the years to come.
