In this article, we discuss 15 stocks that pay dividends monthly. You can skip our detailed analysis of dividend stocks and their performance, and go directly to read 5 Stocks That Pay Dividends Monthly.
The popularity of dividends experienced fluctuations over the years due to economic conditions, market trends, and investor preferences. However, paying dividends has been a long-standing practice in the financial world as they remained a fundamental component of investment returns. Dividend income represented nearly 41% of the S&P 500’s total returns from 1930 to 2022, as we reported in our article, 25 Things Every Dividend Investor Should Know. This shows that dividend income, in addition to capital appreciation, has played a significant role in the market’s overall returns.
Last year was a challenging period for the market as it was hit by tightening monetary policies and growing inflation. Resultantly investors flocked toward dividend-paying stocks to meet their financial needs and obligations. They mainly focused on companies with strong dividend growth histories because of income reliability and a sense of stability. This proved to be the right decision as the S&P 500 Dividend Aristocrat Index outperformed the S&P 500 by a wide margin last year. The S&P 500 High Dividend Index, which tracks the performance of high-yield stocks, lost about 1% in 2022, compared with an 18% decline in the broader market.
Also read: 25 highest-paying monthly dividend stocks
Regardless of their strong performance last year, dividends experienced an uncertain market sentiment in 2023. The advancements and expansion of artificial intelligence (AI) have brought growth tech stocks into the limelight all over again. As of June 19, the tech-heavy NASDAQ gained about 31.8%, outshining the S&P 500 Dividend Aristocrat Index, which is up 3.71% this year so far. However, this does not suggest that the dividend era is over. Global dividend payments grew by 12% in the first quarter of 2023 to a record of $326.7 billion, as reported by Janus Henderson. The report further mentioned that this dividend growth was mainly driven by the largest contribution from special dividends in nine years.
Analysts are also giving a strong outlook for dividend stocks this year especially companies with long dividend growth streaks. Chris Senyek, a chief investment strategist at Wolfe Research, spoke with Barron’s about the significance of dividend stocks in the current environment. Here are some comments from the analyst:
“During economic slowdowns or recessionary environments, our favorite yield-focused strategy is buying companies with a long track record of consistently increasing dividends. This cohort of stocks has generally outperformed heading into and out of recessions.”
The Coca-Cola Company (NYSE:KO), The Procter & Gamble Company (NYSE:PG), and Exxon Mobil Corporation (NYSE:XOM) are some popular companies with decades-long dividend growth track records. However, in this article, we will take a look at some of the best dividend stocks that pay monthly dividends. To know more about such stocks, readers can have a look at 12 Monthly Dividend Stocks Under $10.
Photo by Karolina Grabowska: https://www.pexels.com/photo/hands-holding-us-dollar-bills-4968630/
Our Methodology:
For this list, we used Insider Monkey’s database of 943 hedge funds as of Q1 2023 and selected companies that pay monthly dividends to shareholders. From the resultant list, we picked 15 stocks with the highest number of hedge fund investors. The stocks are ranked in ascending order of hedge funds having stakes in them. Most of these companies belong to the REIT sector as these companies are required to distribute 90% of their taxable income to shareholders in the form of dividends.
15. Stellus Capital Investment Corporation (NYSE:SCM)
Number of Hedge Fund Holders: 3
Dividend Yield as of June 19: 11.43%
Stellus Capital Investment Corporation (NYSE:SCM) is an American externally-managed investment management company that invests in lower middle market companies. The company showed strong results in the first quarter of 2023, with $24.08 million in revenues, up 55.5% from the same period last year. During the quarter, it paid nearly $2.7 million to shareholders in dividends, which makes it one of the best dividend stocks on our list.
On May 26, Stellus Capital Investment Corporation (NYSE:SCM) declared a monthly dividend of $0.1333 per share, which was in line with its previous dividend. Last year, the company also paid additional dividends to shareholders. The stock’s dividend yield on June 19 came in at 11.43%.
In June, B.Riley initiated its coverage on Stellus Capital Investment Corporation (NYSE:SCM) with a Neutral rating and a $14 price target. presenting a positive outlook on the company.
SCM can be added to dividend portfolios alongside some of the best dividend stocks such as The Coca-Cola Company (NYSE:KO), The Procter & Gamble Company (NYSE:PG), and Exxon Mobil Corporation (NYSE:XOM).
At the end of Q1 2023, 3 hedge funds tracked by Insider Monkey reported having stakes in Stellus Capital Investment Corporation (NYSE:SCM), the same as in the previous quarter. These stakes have a collective value of over $2.24 million. Among these hedge funds, Two Sigma Advisors was the company’s leading stakeholder in Q1.
14. ARMOUR Residential REIT, Inc. (NASDAQ:ARR)
Number of Hedge Fund Holders: 4
Dividend Yield as of June 19: 18.46%
ARMOUR Residential REIT, Inc. (NASDAQ:ARR) is a real estate investment trust company, based in Florida. The company mainly invests in residential mortgage-backed securities. On May 31, the company declared a monthly dividend of $0.08 per share, which was consistent with its previous dividend. Though it does not have any dividend growth track record, it has been paying regular dividends to shareholders since 2010. With a dividend yield of 18.46% as of June 19, it is one of the best dividend stocks on our list.
At the end of March 31, ARMOUR Residential REIT, Inc. (NASDAQ:ARR) had over $135.4 million available in cash, and its total assets amounted to over $13.2 billion. The company’s net interest income for the quarter came in at $12 million and its distributable earnings available to common shareholders stood at roughly $50 million.
As of the close of Q1 2023, 4 hedge funds tracked by Insider Monkey reported having stakes in ARMOUR Residential REIT, Inc. (NASDAQ:ARR), worth over $6 million collectively.
13. Ellington Financial Inc. (NYSE:EFC)
Number of Hedge Fund Holders: 5
Dividend Yield as of June 19: 13.31%
Ellington Financial Inc. (NYSE:EFC) is an American real estate credit company that holds investments in a wide range of financial assets. Recently, the company announced its plan to acquire Arlington Asset Investment, another mortgage REIT, which would increase its scale and liquidity. The acquisition is expected to improve the company’s operating expenses, earnings, and book value.
Ellington Financial Inc. (NYSE:EFC), one of the best dividend stocks on our list, currently pays a monthly dividend of $0.15 per share. The stock’s dividend yield on June 19 came in at 13.31%.
Ellington Financial Inc. (NYSE:EFC) generated over $87 million in revenues in the first quarter of 2023, which showed a 70.6% growth from the same period last year. The company had over $188.5 million available in cash and cash equivalents at the end of March 31.
According to Insider Monkey’s database of 943 hedge funds as of Q1 2023, 5 funds owned stakes in Ellington Financial Inc. (NYSE:EFC), with a collective value of over $16.8 million. Mike Vranos’ Ellington was the company’s leading stakeholder in Q1.
12. Orchid Island Capital, Inc. (NYSE:ORC)
Number of Hedge Fund Holders: 6
Dividend Yield as of June 19: 18.69%
Orchid Island Capital, Inc. (NYSE:ORC) is a Florida-baed specialty finance company that invests in residential mortgage-backed securities on a leveraged basis. For the first quarter of 2023, the company’s net income came in at $3.5 million. At the end of March 31, it had roughly $186 million available in cash and cash equivalents.
Orchid Island Capital, Inc. (NYSE:ORC) is one of the best dividend stocks on our list as it had paid regular dividends to shareholders since its IPO in 2013. It currently pays a monthly dividend of $0.16 per share and has a dividend yield of 18.69%, as recorded on June 19.
At the end of March 31, Orchid Island Capital, Inc. (NYSE:ORC) was a part of 6 hedge fund portfolios, the same as in the previous quarter, according to Insider Monkey’s database. The stakes owned by these hedge funds have a collective value of over $6 million.
11. Prospect Capital Corporation (NASDAQ:PSEC)
Number of Hedge Fund Holders: 7
Dividend Yield as of June 19: 11.56%
Prospect Capital Corporation (NASDAQ:PSEC) is next on our list of the best stocks that pay monthly dividends. The business development company reported a total investment income of $215 million in fiscal Q3 2023, up 18.6% from the same period last year. It had over $65 million available in cash and cash equivalents, compared with $35.3 million during the prior-year quarter.
Prospect Capital Corporation (NASDAQ:PSEC) currently offers a monthly dividend of $0.06 per share and has a dividend yield of 11.56%, as of June 19. It is one of the best dividend stocks on our list as it has been making monthly dividend payments for 70 consecutive months.
The number of hedge funds tracked by Insider Monkey owning stakes in Prospect Capital Corporation (NASDAQ:PSEC) grew to 7 in Q1 2023, from 4 in the previous quarter. These stakes are collectively valued at over $4 million.
10. Main Street Capital Corporation (NYSE:MAIN)
Number of Hedge Fund Holders: 9
Dividend Yield as of June 19: 7.04%
Main Street Capital Corporation (NYSE:MAIN) is a Texas-based capital market company that provides long-term debt and equity capital to lower middle market companies. In May, B. Riley raised its price target on the stock to $46, highlighting the company’s overall performance this year.
On May 2, Main Street Capital Corporation (NYSE:MAIN) declared a 2.2% hike in its monthly dividend to $0.23 per share. The company also declared a supplemental dividend of $0.225 per share. With a dividend yield of 7.04% as of June 19, MAIN is one of the best dividend stocks on our list that pay monthly dividends.
In the first quarter of 2023, Main Street Capital Corporation (NYSE:MAIN) reported a total investment income of $120.3 million and its net investment income for the quarter came in at over $81 million. The company posted an EPS of $1.07, which beat Street estimates by $0.11.
At the end of Q1 2023, 9 hedge funds in Insider Monkey’s database reported having stakes in Main Street Capital Corporation (NYSE:MAIN), compared with 11 in the previous quarter. These stakes are collectively valued at roughly $23 million.
9. LTC Properties, Inc. (NYSE:LTC)
Number of Hedge Fund Holders: 10
Dividend Yield as of June 19: 6.70%
LTC Properties, Inc. (NYSE:LTC) is an American real estate investment trust company that invests in senior housing and healthcare facilities. In the first quarter of 2023, the company reported revenue of roughly $50 million, which showed a 21.4% growth from the same period last year. Its net income available to common stakeholders came in at nearly $33 million, up from $14.2 million from the prior-year period.
One of the best dividend stocks on our list, LTC Properties, Inc. (NYSE:LTC) pays a monthly dividend of $0.16 per share. The stock’s dividend yield on June 19 came in at 6.70%.
In April, Wells Fargo initiated its coverage on LTC Properties, Inc. (NYSE:LTC) with an Equal Weight rating and a $36 price target.
According to Insider Monkey’s database, 10 hedge funds owned investments in LTC Properties, Inc. (NYSE:LTC) in Q1 2023, up from 9 in the previous quarter. The stakes owned by these funds have a collective value of over $8.3 million. Ken Griffin’s Citadel Investment Group was the company’s leading stakeholder in Q1.
8. Dynex Capital, Inc. (NYSE:DX)
Number of Hedge Fund Holders: 11
Dividend Yield as of June 19: 12.57%
Dynex Capital, Inc. (NYSE:DX) is a Virginia-based real estate investment trust company that invests in mortgage loans. On June 12, the company declared a monthly dividend of $0.13 per share, which was in line with its previous dividend. It has been paying regular dividends to shareholders since 2008, which makes it one of the best dividend stocks on our list. The stock’s dividend yield came in at 12.57% on June 19.
At the end of Q1 2023, 11 hedge funds in Insider Monkey’s database reported having stakes in Dynex Capital, Inc. (NYSE:DX), compared with 13 a quarter earlier. These stakes are collectively worth over $45.5 million.
7. STAG Industrial, Inc. (NYSE:STAG)
Number of Hedge Fund Holders: 15
Dividend Yield as of June 19: 4.02%
STAG Industrial, Inc. (NYSE:STAG) is an American real estate investment trust company that mainly specializes in industrial properties throughout the US. The company posted strong results in the first quarter of 2023, with revenue of $173.5 million showing a 9% year-over-year growth. Its cash and cash equivalents at the end of March 31 amounted to over $17.2 million.
STAG Industrial, Inc. (NYSE:STAG), one of the best dividend stocks, has been raising its dividends consistently for the past 11 years. It pays a monthly dividend of $0.1225 per share and has a dividend yield of 4.02%, as recorded on June 19.
STAG Industrial, Inc. (NYSE:STAG) was a part of 15 hedge fund portfolios in Q1 2023, according to Insider Monkey’s database. The stakes owned by these elite funds are collectively worth over $121 million. With over 1.5 million shares, Waterfront Capital Partners was the company’s leading stakeholder in Q1.
6. Apple Hospitality REIT, Inc. (NYSE:APLE)
Number of Hedge Fund Holders: 18
Dividend Yield as of June 19: 6.34%
Apple Hospitality REIT, Inc. (NYSE:APLE) is a Virginia-based real estate investment trust company that owns portfolios of some of the biggest rooms-focused hotels in the country. It currently pays a monthly dividend of $0.08 per share and has a dividend yield of 6.34%, as of June 19. In 2022, it raised its dividends two times, after recovering from the pandemic-related losses. APLE is among the best dividend stocks on our list.
Other popular dividend stocks among investors are The Coca-Cola Company (NYSE:KO), The Procter & Gamble Company (NYSE:PG), and Exxon Mobil Corporation (NYSE:XOM).
Apple Hospitality REIT, Inc. (NYSE:APLE) generated $311.4 million in revenues in Q1 2023, up 20% from the same period last year. Its net income for the quarter came in at $33 million, showing an 83% year-over-year growth.
At the end of March 31, 18 hedge funds tracked by Insider Monkey held stakes in Apple Hospitality REIT, Inc. (NYSE:APLE), worth collectively over $112.2 million. Ken Griffin, Steve Cohen, and Mark Coe were some of the company’s leading stakeholders in Q1.
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Disclosure. None. 15 Stocks That Pay Dividends Monthly is originally published on Insider Monkey.