In this article, we discuss the 10 monthly dividend stocks to buy in May.
Investors rely on dividend stocks to protect their portfolios from market volatility, and the regular income also provides a hedge against inflation. Companies that pay dividends have stable business models with high cash flow, and reward investors by sharing their profits. Most retirees seeking a stable income opt for a financial portfolio that consists of proven dividend-paying stocks. While most companies dole out their dividend payments every quarter, some pay investors every month, making them excellent monthly income stocks to hold.
Dividend payments can also be reinvested into buying more of the company stock, which means that the stock pays for itself on a long enough timeline. This Dividend Compounding effect is responsible for 84% of the total return posted by the S&P 500 Index from 1960 to 2021. From the time period between 1930 and 2021, dividend income contributed an average of 40% to the total returns posted by the S&P 500 Index. This goes to show that dividend stocks have played an important part in the growth of the economy, and will continue to do so.
According to Janus Henderson Global Dividend Index report, dividend payments around the globe soared after the pandemic disaster in 2020, and registered a 14.7% jump in underlying growth in 2021 to reach a record of $1.47 trillion. The report predicts that global dividend payments are expected to clock in at $1.52 trillion in 2022, signaling an underlying growth of 5.7%. Some of the best dividend stocks to hold include Johnson & Johnson (NYSE:JNJ), The Procter & Gamble Company (NYSE:PG), and Walmart Inc. (NYSE:WMT), but in this article we’ll be focusing on monthly dividend stocks to buy in May.
Photo by Dan Dennis on Unsplash
Let’s go ahead and take a look at our list.
Our Methodology
We picked monthly dividend stocks that look set to deliver shareholders stable returns for the month of May and beyond. We looked for stable business models, solid fundamentals, positive analyst ratings, market share and future growth potential. We also mentioned the hedge fund sentiment around each stock to give readers better context for their investment choices.
10 Monthly Dividend Stocks to Buy in May
10. Apple Hospitality REIT, Inc. (NYSE:APLE)
Number of Hedge Fund Holders: 22
Dividend Yield (as of April 29): 3.39%
Apple Hospitality REIT, Inc. (NYSE:APLE) features next on the list of monthly dividend stocks to buy in May. The real estate investment trust manages a portfolio of upscale hotel properties in the United States, with tenants including major brands such as Hyatt, Marriot, and Hilton, among others.
On April 21, Apple Hospitality REIT, Inc. (NYSE:APLE) was given an ‘Outperform’ rating and a $23 price target by Oppenheimer analyst Tyler Batory who initiated coverage of the firm. He sees the REIT becoming a net buyer of assets in 2022, and notes that it was the first lodging REIT to return to a meaningful dividend payment. The analyst sees Apple Hospitality REIT, Inc. (NYSE:APLE) as well-positioned in the market given its high-quality and geographically diverse portfolio of select-service hotels.
Apple Hospitality REIT, Inc. (NYSE:APLE) on April 21 declared $0.05 per share monthly dividend, which was in-line with previous. As of April 29, the firm has grown 11.54% in the last 12 months and 9.47% in the last 6 months, and currently offers a yield of 3.39% to shareholders.
Monarch Alternative Capital held 5.28 million shares of Apple Hospitality REIT, Inc. (NYSE:APLE) in the fourth quarter worth $85.4 million, making it the top shareholder of the REIT. In total, 22 hedge funds reported bullish bets on the company shares during the fourth quarter, as compared to 15 hedge funds a quarter ago.
Just like Johnson & Johnson (NYSE:JNJ), The Procter & Gamble Company (NYSE:PG), and Walmart Inc. (NYSE:WMT), Apple Hospitality REIT, Inc. (NYSE:APLE) is a top dividend stock to buy.
9. Stag Industrial, Inc. (NYSE:STAG)
Number of Hedge Fund Holders: 22
Dividend Yield (as of April 29): 3.91%
Stag Industrial, Inc. (NYSE:STAG) is an industrial real estate investment trust (REIT) which deals in single-tenant, industrial properties throughout the United States. The firm boasts a strong portfolio of industrial properties and offers shareholders a stable yield of 3.91% as of April 29. On April 14, Stag Industrial, Inc. (NYSE:STAG) declared a $0.1217 per share monthly dividend, which was in-line with previous. It has raised its dividend yield for 7 years in a row, and is one of the top ranked monthly-paying dividend stocks to buy.
In January, Baird analyst David Rodgers upgraded Stag Industrial, Inc. (NYSE:STAG) to ‘Outperform’ from ‘Neutral’ with a revised price target of $48 from $49. The analyst sees industrial REITs as a long-term core holding, but sees some near-term challenges for the sector such as interest rate sentiment, consumer spending normalization and labor challenges. For the fourth quarter, Stag Industrial, Inc. (NYSE:STAG) posted $147.62 million in revenue, outperforming estimates by $288,000 and showing an increase of 13.6% year-on-year.
As of the fourth quarter, 22 hedge funds held stakes in Stag Industrial, Inc. (NYSE:STAG) with a combined value of $525.4 million. This shows that investors are increasingly valuing the company’s future prospects and stable monthly dividends, as 17 hedge funds were long on the company shares a quarter ago. Zimmer Partners held 2.85 million shares of Stag Industrial, Inc. (NYSE:STAG) in Q4 2021 with a total value of $136.7 million, making it the leading shareholder of the firm.
8. Whitestone REIT (NYSE:WSR)
Number of Hedge Fund Holders: 11
Dividend Yield (as of April 29): 3.95%
Whitestone REIT (NYSE:WSR) is a shopping center real estate investment trust which develops and operates community-oriented retail and mixed-use properties in the United States. On February 22, Whitestone REIT (NYSE:WSR) declared $0.04 per share monthly dividend, which shows an increase of 11.6% from its prior dividend of $0.0358. As of April 29, the firm offers a yield of 3.95%, and has seen its share price gain 24.36% in the last 12 months, and 19.70% in the year to date.
On April 6, Colliers analyst David Toti initiated coverage of Whitestone REIT (NYSE:WSR) with a ‘Buy’ rating and a $15 price target. In Q4 2021, the firm posted $33.26 million in revenue which beat consensus estimates by $591,000 and also signaled an increase of 11.48% year-on-year.
Texas-based Highland Capital Management was the largest shareholder of Whitestone REIT (NYSE:WSR) in the fourth quarter of 2021, with a position consisting of 2.27 million shares worth roughly $23 million. Out of all the hedge funds tracked by Insider Monkey, 11 held stakes in Whitestone REIT (NYSE:WSR) during the fourth quarter of 2021 with a combined value of $39.3 million. This is down from 13 hedge funds in the preceding quarter.
7. Agree Realty Corporation (NYSE:ADC)
Number of Hedge Fund Holders: 26
Dividend Yield (as of April 29): 4.13%
Agree Realty Corporation (NYSE:ADC) is another real estate investment trust that ranks on our list of 10 monthly dividend stocks to buy in May. The firm engages in the net lease of commercial properties in the form of community shopping centers to industry-leading retail tenants, and offers a yield of 4.13% as of April 29. Agree Realty Corporation (NYSE:ADC) on April 12 declared $0.234 per share monthly dividend, which was a 3.1% increase from its prior dividend of $0.227.
In the start of April, Morgan Stanley analyst Ronald Kamdem initiated coverage of Agree Realty Corporation (NYSE:ADC) with an ‘Overweight’ rating and a price target of $75. The analyst sees the firm’s tenant quality as the best among triple net real estate investment trusts, and notes that its focus on internet-resistant tenants with its vertically integrated platform is differentiated. Kamdem sees an attractive entry point for the company stock at current price levels.
Hedge fund sentiment was up on Agree Realty Corporation (NYSE:ADC) in the fourth quarter of 2021, where 26 hedge funds reported bullish bets on the company shares with combined holdings worth $200 million. In comparison, 20 hedge funds held $155 million worth of positions in the REIT a quarter ago. Israel Englander’s Millennium Management was the largest shareholder of Agree Realty Corporation (NYSE:ADC) in Q4 2021, with a stake comprising of 1.17 million shares valued at $83.5 million.
6. Realty Income Corporation (NYSE:O)
Number of Hedge Fund Holders: 30
Dividend Yield (as of April 29): 4.27%
Realty Income Corporation (NYSE:O) is one of the most prominent monthly dividend-paying stocks, and has grown its dividend payment to shareholders for 25 years in a row. The California-based real estate investment trust (REIT) manages more than 11,000 commercial real estate properties leased out to customers in the United States, United Kingdom and Spain.
Wolfe Research analyst Andrew Rosivach on March 15 upgraded Realty Income Corporation (NYSE:O) to ‘Outperform’ from ‘Peer Perform’. On April 13, Realty Income Corporation (NYSE:O) declared a $0.247 per share monthly dividend, which was in-line with previous, and the firm’s dividend yield stood at 4.27% as of April 29.
Out of all the hedge funds tracked by Insider Monkey in the fourth quarter of 2021, 30 were long Realty Income Corporation (NYSE:O) with combined stakes worth $398.9 million. This shows a positive trend from the preceding quarter where 22 hedge funds held $275 million worth of positions in the company. The largest Q4 shareholder of Realty Income Corporation (NYSE:O) was Glendon Capital Management, which held 1.85 million shares of the REIT worth $132.9 million.
Along with Johnson & Johnson (NYSE:JNJ), The Procter & Gamble Company (NYSE:PG), and Walmart Inc. (NYSE:WMT), Realty Income Corporation (NYSE:O) is an attractive option for income-oriented investors.
5. EPR Properties (NYSE:EPR)
Number of Hedge Fund Holders: 22
Dividend Yield (as of April 29): 6.28%
EPR Properties (NYSE:EPR) is a real estate investment trust which owns and manages entertainment-themed properties such as ski resorts, casinos and movie theatres across the United States. The firm temporarily ceased its dividend payments during the pandemic in 2020, but with tourism picking up after the Covid lockdowns, EPR Properties (NYSE:EPR) is well-positioned to enjoy future growth and stability, and offers an impressive yield of 6.28% as of April 29. The firm declared on April 14 a $0.275 per share monthly dividend, which was in-line with previous.
Investors were seen buying up on EPR Properties (NYSE:EPR) in the fourth quarter of 2021, with 22 hedge funds reporting bullish bets on the company shares, as compared to 19 hedge funds a quarter ago. Arrowstreet Capital, the largest shareholder of EPR Properties (NYSE:EPR) during the fourth quarter, held 1.11 million shares of the REIT worth $53.14 million.
As of April 29, EPR Properties (NYSE:EPR) has jumped 10.08% in the last 12 months, and 8.49% in the year to date. The company posted $154.91 million in revenue for the fourth quarter, which showed an increase of 65.83% from the year-ago quarter and also beat analysts’ expectations by $14.5 million.
4. Main Street Capital Corporation (NYSE:MAIN)
Number of Hedge Fund Holders: 9
Dividend Yield (as of April 29): 6.41%
Main Street Capital Corporation (NYSE:MAIN) is a Texas-based business development company which offers capital to lower middle market companies in return for stakes or debt offerings. It also offers services such as management buyouts, refinancing, family estate planning and recapitalizations. On April 29, Main Street Capital Corporation (NYSE:MAIN) declared $0.215 per share in quarterly dividend, which was in-line with previous. This brings the firm’s dividend yield to shareholders at 6.41%.
Hovde Group analyst Bryce Rowe in March initiated coverage of Main Street Capital Corporation (NYSE:MAIN) with a ‘Market Perform’ rating and a $44 price target. The company recently invested $36.4 million in Jorgensen Laboratories, a supplier of equipment and supplies to the veterinary profession, in order to facilitate its recapitalization.
Of the 924 hedge funds being tracked by Insider Monkey as of the fourth quarter of 2021, 9 were long Main Street Capital Corporation (NYSE:MAIN) with overall positions worth $31.97 million. This shows growing investor confidence in the firm over the previous quarter where 5 hedge funds held $26 million worth of company shares. Millennium Management held roughly 236,000 shares of Main Street Capital Corporation (NYSE:MAIN) during the fourth quarter with a price tag of $10.6 million, making it the top shareholder of the firm.
3. Gladstone Capital Corporation (NASDAQ:GLAD)
Number of Hedge Fund Holders: 5
Dividend Yield (as of April 29): 6.95%
Gladstone Capital Corporation (NASDAQ:GLAD) is up next on our list of monthly dividend stocks to buy in May. It is a business development company which invests in small and medium-sized businesses in the United States. In early April, Raymond James analyst Robert Dodd initiated coverage of Gladstone Capital Corporation (NASDAQ:GLAD) with a ‘Market Perform’ rating, whilst noting that although recent performance has been solid, he views the shares as fairly valued at current levels.
On April 13, Gladstone Capital Corporation (NASDAQ:GLAD) declared a $0.0675 per share monthly dividend, a 3.8% increase from its prior dividend of $0.0650. This will be payable on April 29, for shareholders of record until April 22. This brings the company’s yield to 6.95% as of April 29.
Reporting its fourth quarter earnings on February 2, Gladstone Capital Corporation (NASDAQ:GLAD) posted an EPS of $0.27, outperforming estimates by $0.07. Quarterly revenue of $16.17 million showed a jump of 25.5% from the year-ago quarter and also beat consensus estimates by $1.65 million.
Two Sigma Advisors held 164,000 shares of Gladstone Capital Corporation (NASDAQ:GLAD) in Q4 2021 with a price tag of $1.89 million which made it the largest shareholder of the firm. In total, 5 hedge funds were long on the company shares in the fourth quarter, up from 4 in the preceding quarter.
2. Sabine Royalty Trust (NYSE:SBR)
Number of Hedge Fund Holders: 4
Dividend Yield (as of April 29): 7.74%
Up next on our list of monthly dividend stocks to buy this month is Sabine Royalty Trust (NYSE:SBR), a Texas-based firm which holds royalty and mineral interests in various oil and gas properties across the United States. As energy prices and inflation on an upward trajectory, Sabine Royalty Trust (NYSE:SBR) is well-positioned to benefit from these trends. As of April 29, the firm’s shares have registered an uptick of 81.81% in the last year, and 49.75% in the year to date.
On April 6, Sabine Royalty Trust (NYSE:SBR) declared a monthly dividend of $0.7302 per share, which was an increase of 56.3% from its previous dividend of $0.4672. The firm yielded a dividend of 7.74% as of April 29.
4 out of 900+ elite hedge funds tracked by Insider Monkey in the fourth quarter of 2021 were bullish on Sabine Royalty Trust (NYSE:SBR) shares, with combined stakes worth $4.96 million. The same number of hedge funds held positions in the company a quarter earlier as well. Royce & Associates, the top shareholder of Sabine Royalty Trust (NYSE:SBR) in the fourth quarter, held a $3.4 million stake in the company consisting of roughly 83,000 shares.
1. Dynex Capital, Inc. (NYSE:DX)
Number of Hedge Fund Holders: 4
Dividend Yield (as of April 29): 9.61%
Dynex Capital, Inc. (NYSE:DX) ranks first on our list of monthly dividend stocks to buy in May 2022. The real estate investment trust invests primarily in mortgage-backed securities (MBS) that are backed by the United States government or a U.S. government-sponsored entity. As of April 29, it offers shareholders an impressive yield of 9.61%
JonesTrading analyst Jason Stewart on April 28 maintained a ‘Buy’ rating on the company shares, and revised the price target to $19 from $20. Stewart notes that the firm reported strong Q1 book value performance and will continue to increase its leverage through 2022. He reduced the price target owing to uncertainty in the macro environment, but notes that it still represents a 40% total return opportunity.
4 hedge funds were long Dynex Capital, Inc. (NYSE:DX) in Q4 2021, as compared to 7 hedge funds a quarter ago. Out of all the hedge funds tracked by Insider Monkey, Ken Griffin’s Citadel Investment Group was the top shareholder of the firm during the fourth quarter, with roughly 87,000 shares valued at $1.44 million.
You can also take a look at 10 Best Dividend Paying Stocks to Buy Under $50 and 15 Largest AI Companies in the World.
