In this article, we will discuss 11 best dividend stocks that pay monthly dividends.
Dividend stocks have long been a favorite among investors, regardless of the payout frequency. Companies, however, are deliberate in determining how often to reward their shareholders. Annual and semi-annual dividends might provide larger payouts, but their unpredictability can be challenging for investors. While major firms opt for quarterly payouts due to practicality, some choose monthly distributions, which many investors find attractive for the steady stream of passive income. In addition, a reduction in monthly payouts would have a smaller immediate impact, and receiving dividends monthly is one of the closest alternatives to a regular paycheck, simplifying the management of day-to-day finances. That said, history suggests that companies offering monthly dividends often boast higher yields but may lack consistent dividend policies.
Regardless of market conditions, dividend stocks can be a useful tool for enhancing income and boosting portfolio growth potential. For instance, investors who are years away from retirement often reinvest their dividends to increase returns. According to an estimate by Charles Schwab, a hypothetical $10,000 investment in a broader market at the end of 1993 would have grown to over $182,000 by the end of 2023 if dividends were reinvested, compared to only $102,000 if they had not been reinvested.
Also read: 10 Biggest Dividend Cuts and Suspensions of 2024
This means that investors looking to reduce their risk while still maintaining growth potential may want to consider high-quality dividend-paying companies. This approach is favored by Ramona Persaud, manager of Fidelity Equity-Income Fund and Fidelity Global Equity Income Fund. She tends to focus on shares of high-quality firms that offer attractive valuations and strong dividends. Persaud pointed out that falling interest rates can create a favorable environment for dividend stocks, as their yields become more appealing compared to declining bond yields. She also mentioned that lower interest rates may lead to gains across a wider range of stocks, a shift from the past two years when market gains were largely driven by a few large-cap growth stocks. Here are some other comments from the analyst:
“I’m excited that really good companies may get more credit from investors than they have during the wave of glamour stocks. And investors stand to gain from the stocks’ dividend payments.”
Persaud prioritizes stocks with strong balance sheets, high potential returns on investment, and predictable cash flows. Additionally, she seeks out stocks with attractive dividend yields relative to similar companies and the broader market. Monthly dividend stocks also focus on high dividend yields, which can be a key draw. While high yields may sometimes indicate the possibility of dividend cuts or weaker balance sheets, many monthly dividend companies have been increasing their payouts for years and also maintain solid financial health. However, investors should exercise caution when investing in these stocks.
High dividend yields are not inherently negative. Stocks with high yields can still uphold strong dividend policies if their business fundamentals are solid. Many companies with above-average yields have consistently paid and even increased their dividends over time. Research indicated that, in the long run, these stocks often provide superior returns. For instance, a University of Nevada study found that portfolios consisting of the top 10 highest dividend yield stocks from the Dow 30 index outperformed those with medium and low dividend yields between 1987 and 2012. The study also highlighted that investing in high dividend yield stocks can be profitable over the long term, despite potential short-term fluctuations in returns. In view of this, we will take a look at some of the best dividend stocks that pay monthly dividends.
Our Methodology:
For this list, we reviewed a list of companies providing monthly dividends to their shareholders. Among these, we specifically chose businesses with robust dividend practices, consistently maintaining their payouts across multiple years. The majority of these selected companies operate within the Real Estate Investment Trust (REIT) sector, as they are required to allocate 90% of their income towards dividends. From that list, we picked 11 stocks with the highest number of hedge fund investors, using Insider Monkey’s Q3 2024 database of 900 hedge funds and their holdings.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here).
11. Gladstone Land Corporation (NASDAQ:LAND)
Number of Hedge Fund Holders: 5
Gladstone Land Corporation (NASDAQ:LAND) is an American real estate investment trust company that owns and acquires farmlands and farm-related properties. Over the past year, the company faced challenges stemming from lower crop prices, which impacted some of its tenants. As a result, it had to reclaim 20 farms, either leaving them vacant or taking over their operations directly. In addition, the company renegotiated certain leases, agreeing to lower initial rental rates in exchange for a greater share of future crop revenue. In the past year, the stock has declined by nearly 28%.
However, Gladstone Land Corporation (NASDAQ:LAND) anticipates resolving these issues by the year-end and expects higher revenue in the latter half of 2025, coinciding with the harvest season. This improvement should support the REIT’s ability to sustain its dividend growth moving forward.
In the third quarter of 2024, Gladstone Land Corporation (NASDAQ:LAND)’s annual row crop farms in California and Florida continued to perform well, demonstrating both value appreciation and rent growth. However, many permanent crop farms in the western regions have faced challenges due to declining crop prices, rising input costs, and concerns about water availability. In response, the company has adopted a different leasing strategy for some of these farms. Under this approach, tenants receive a cash allowance to help offset their costs in exchange for the company receiving a larger share of the gross crop proceeds. While intended as a temporary measure, this arrangement is seen as the most profitable option for these particular farms, given their history of high yields, strong crop insurance, and an upward trend in crop prices.
Gladstone Land Corporation (NASDAQ:LAND) reported revenue of $22.5 million in the third quarter of 2024, which fell by over 4% from the same period last year. However, the revenue beat analysts’ estimates by $1.14 million. It is one of the best dividend stocks as the company has paid consecutive 141 monthly dividends to shareholders. In addition, it has increased its payouts 35 times over the past 39 quarters. Currently, it pays a monthly dividend of $0.0467 per share and has a dividend yield of 5.27%, as of December 28.
At the end of Q3 2024, 5 hedge funds tracked by Insider Monkey held stakes in Gladstone Land Corporation (NASDAQ:LAND), down from 9 in the previous quarter. These stakes have a total value of more than $6.5 million.
10. Main Street Capital Corporation (NYSE:MAIN)
Number of Hedge Fund Holders: 7
Main Street Capital Corporation (NYSE:MAIN) is an American business development company, headquartered in Texas. The company provides customized debt and equity financing to lower-middle-market companies and debt capital to middle-market companies. It holds a top spot in cost efficiency, boasting an Operating Expenses to Assets Ratio of 1.3% on an annualized basis. This metric, which reflects total non-interest operating expenses as a percentage of quarterly average total assets, was consistent for both the quarter and the trailing twelve-month period ending September 30, 2024. The stock has delivered strong returns in 2024, surging by over 32% in the past 12 months.
In the third quarter of 2024, Main Street Capital Corporation (NYSE:MAIN) reported a total investment income of $136.8 million, which showed an 11% growth from the same period last year. The company finalized $51.6 million in total investments within its lower middle market (LMM) portfolio, which included an $11.2 million investment in a newly added LMM portfolio company. Its cash position also remained strong. The company ended the quarter with $84.4 million available in cash and cash equivalents, up from $60 million at the end of December 2023.
Main Street Capital Corporation (NYSE:MAIN) is a solid dividend payer as the company has a history of paying supplemental dividends over the years. On November 7, the company declared a 2% hike in its monthly dividend to $0.25 per share. In addition, it also announced an additional dividend of $0.30 per share. This was the company’s 13th consecutive quarter of paying supplemental dividends to shareholders, which makes MAIN one of the best dividend stocks that pay monthly dividends. As of December 28, the stock has a dividend yield of 5.18%.
As of the end of Q3 2024, 7 hedge funds tracked by Insider Monkey held stakes in Main Street Capital Corporation (NYSE:MAIN), compared with 8 in the previous quarter. These stakes are worth over $21 million in total. Among these hedge funds, Balyasny Asset Management was the company’s leading stakeholder in Q3.
9. LTC Properties Inc. (NYSE:LTC)
Number of Hedge Fund Holders: 13
LTC Properties Inc. (NYSE:LTC) is a California-based real estate investment trust company that invests in senior housing and healthcare facilities through sale-leasebacks. According to analysts, the company appears well-positioned for growth, as the aging US population is expected to sustain strong demand for its services. Management predicts that approximately 4.1 million Americans will reach the age of 65 each year until 2027, with the population aged 85 and older potentially climbing to 11 million by 2035. In the past 12 months, the stock has surged by over 5%.
In the third quarter of 2024, LTC Properties Inc. (NYSE:LTC) reported revenue of $55.7 million, which saw a 13% growth from the same period last year. The company’s revenue grew due to income from previously transitioned portfolios, increased income from loan originations, construction loan funding during 2024, and higher rental income, though partially offset by reduced revenue from property sales. As disclosed earlier, the company committed $26.1 million for a mortgage loan to finance the construction of a 116-unit senior living community in Illinois, covering independent living, assisted living, and memory care. The borrower has already contributed $12.3 million in equity to start construction, which is expected to be fully utilized by early 2025, at which point LTC will begin funding its loan commitment.
LTC Properties Inc. (NYSE:LTC) had a solid quarter from a cash point of view. At the end of September, it had over $35 million available in cash and cash equivalents, growing from $20.2 million at the end of 2023. This cash position has allowed the company to pay regular monthly dividends to shareholders since 2005. Before that, it had quarterly payouts dating back to 1992. Currently, it offers a monthly dividend of $0.19 per share and has a dividend yield of 6.62%, as of December 28.
LTC Properties Inc. (NYSE:LTC) was a part of 13 hedge fund portfolios at the end of Q3 2024, up from 12 in the preceding quarter, as per Insider Monkey’s database. The stakes owned by these hedge funds have a collective value of more than $75 million. Among these funds, Balyasny Asset Management was the company’s leading stakeholder in Q3.
8. Phillips Edison & Company, Inc. (NASDAQ:PECO)
Number of Hedge Fund Holders: 18
Phillips Edison & Company, Inc. (NASDAQ:PECO) ranks eighth on our list of the best dividend stocks that offer monthly dividends. The real estate investment trust company owns and develops shopping centers throughout the US. The company attributes its ongoing strong performance to a targeted strategy of owning well-sized, high-quality neighborhood shopping centers anchored by the top one or two grocers in their respective markets. This success at the property level reflects the effectiveness of its integrated operating platform and the expertise of its seasoned team. Supported by a robust operating environment and the stability of its tenants, the company has raised its full-year 2024 earnings guidance for Core FFO per share. In addition, the acquisitions guidance for 2024 has been increased to a range of $275 million to $325 million, net of dispositions. With sufficient resources and leverage capacity, the company remains positioned to pursue additional assets as promising opportunities emerge.
Phillips Edison & Company, Inc. (NASDAQ:PECO) generated $165.5 million in revenues in the third quarter of 2024, up 8.56% from the same period last year. The revenue also beat analysts’ estimates by $2.11 million. The company ended the quarter with nearly $6.5 million available in cash and cash equivalents, up from $4.8 million at the end of December 2023. Its total assets amounted to roughly $5 billion, up slightly from $4.8 billion at the end of December 2023.
On October 30, Phillips Edison & Company, Inc. (NASDAQ:PECO) declared a monthly dividend of $0.1025 per share, having raised it by 5.1% in September this year. The company started paying dividends in 2021 and has raised its payouts every year since then. With a dividend yield of 3.26%, as of December 28, PECO is one of the best dividend stocks on our list.
The number of hedge funds tracked by Insider Monkey owning stakes in Phillips Edison & Company, Inc. (NASDAQ:PECO) grew to 18 in Q3 2024, from 14 in the previous quarter. These stakes have a consolidated value of nearly $116 million. Among these hedge funds, Alyeska Investment Group owned the largest position in the company.
7. Apple Hospitality REIT, Inc. (NYSE:APLE)
Number of Hedge Fund Holders: 19
Apple Hospitality REIT, Inc. (NYSE:APLE) is an American real estate investment trust company that operates in hotel properties across the country. On December 9, BMO Capital initiated its coverage of the stock with an Outperform rating and an $18 price target. An analyst described the company as the largest dedicated select-service lodging REIT, emphasizing its high-quality and diverse portfolio. In a research note, the firm expressed a favorable view of the company, highlighting its defensive qualities while noting its potential to benefit from improvements in revenue per available room (RevPAR).
In the third quarter of 2024, business transient demand showed gradual improvement, while leisure travel remained robust, contributing to solid operating fundamentals across the portfolio during the quarter. Comparable Hotels reported a RevPAR growth of about 1% compared to the third quarter of 2023. Preliminary figures for October indicated occupancy levels around 80%, alongside further increases in average daily rate (ADR). The company’s Q3 revenue came in at $378.8 million, up 5.75% from the same period last year. Its operating income also showed a 2% YoY growth at $77.7 million.
Apple Hospitality REIT, Inc. (NYSE:APLE) is one of the best dividend stocks on our list as the company has never missed a dividend since 2008. On December 19, the company announced a monthly dividend of 0.08 per share, which was in line with its previous dividend. In addition, it also declared a supplemental dividend of $0.05 per share. The stock’s dividend yield on December 28 came in at 6.22%.
Insider Monkey’s database of Q3 2024 indicated that 19 hedge funds held stakes in Apple Hospitality REIT, Inc. (NYSE:APLE), the same as in the previous quarter. These stakes are collectively valued at over $98.4 million. With over 3 million shares, Balyasny Asset Management was the company’s leading stakeholder in Q3.
6. Realty Income Corporation (NYSE:O)
Number of Hedge Fund Holders: 23
An American real estate investment trust company, Realty Income Corporation (NYSE:O) invests in single-tenant commercial properties in the country. The company is financially robust, with an investment-grade balance sheet. Its large size provides easier access to capital markets, while its strong financial position enables it to secure favorable rates on debt issued for funding growth. In addition, its size and financial stability make it easier to sell stock on Wall Street at attractive prices. The stock surged by over 21% during the third quarter and is down by over 10% in the past 12 months.
While there are many REITs in the US, Realty Income Corporation (NYSE:O) stands out as unique. Over the past 30 years, the company has weathered major events like the dot-com crash, the Great Recession, and the coronavirus pandemic, all while consistently raising its dividend. Even during the toughest year of the Great Recession, its occupancy rates never dropped below 96.6%, and they are currently around 98.7%. In short, the company’s business remains strong, and it has demonstrated its ability to perform successfully even during challenging financial times.
Realty Income Corporation (NYSE:O) is one of the best monthly dividend stocks as the company has consistently raised its payouts since its IPO in 1994. On December 10, the company increased its monthly payout by 0.2%, bringing it to $0.264 per share. This marks the fifth dividend increase this year. As of December 28, the stock has a dividend yield of 6.08%.
Parnassus Investments highlighted Realty Income Corporation (NYSE:O) in its Q3 2024 investor letter. Here is what the firm has to say:
“Realty Income Corporation (NYSE:O) is poised to benefit from lower interest rates. Because its commercial tenants are mostly on 10-year leases, the stock’s steady dividend stream is attractive in the current environment of slow deceleration in the economy with rates coming down. In this favorable backdrop, the company also continues to execute well.”
Of the 900 hedge funds tracked by Insider Monkey at the end of Q3 2024, 23 funds held stakes in Realty Income Corporation (NYSE:O), growing from 19 in the previous quarter. The total value of these stakes is more than $163.5 million. With over 1.7 million shares, AEW Capital Management owned the largest stake in the company.
5. EPR Properties (NYSE:EPR)
Number of Hedge Fund Holders: 23
EPR Properties (NYSE:EPR) leases its properties to various entertainment and educational businesses, including amusement parks, movie theaters, and ski resorts, across the US and Canada. As a triple net lease REIT, the company requires its tenants to cover all real estate taxes, insurance, and maintenance costs. It owns 352 properties and leases to over 200 tenants in 44 US states and Canada.
In the past 12 months, EPR Properties (NYSE:EPR) has declined by over 10.4%. The company’s reliance on the shrinking movie theater market is a significant concern. In 2023, only 852 million movie tickets were sold in the US, a sharp decline from 1.85 billion tickets in 2002, and this downward trend may persist. The rise of streaming platforms, affordable large-screen TVs, and increasing ticket prices have led more people to watch movies at home. Despite these challenges, the company achieved a 99% occupancy rate by the end of Q3 2024. It managed this by selling off vacant theaters, attracting more non-theater tenants for experiential businesses, and expanding its education-related property portfolio.
During the quarter, EPR Properties (NYSE:EPR) finalized the sale of two theater properties and one early childhood education center, generating net proceeds of $8.7 million. The company’s cash position remained strong. It ended the quarter with over $35.3 million of cash on hand with total assets amounting to nearly $5.7 billion.
EPR Properties (NYSE:EPR), one of the best dividend stocks, started paying quarterly dividends to shareholders since its IPO in 1997. The company shifted to monthly payments in 2013 and has paid regular dividends to shareholders since then. Its monthly dividend comes in at $0.285 per share for a dividend yield of 7.79%, as of December 28.
As of the close of Q3 2023, 23 hedge funds held stakes in EPR Properties (NYSE:EPR), according to Insider Monkey’s database. These stakes are worth $247.4 million in total.
4. AGNC Investment Corp. (NASDAQ:AGNC)
Number of Hedge Fund Holders: 24
AGNC Investment Corp. (NASDAQ:AGNC) ranks fourth on our list of the best monthly dividend stocks. The Maryland-based real estate investment trust company invests in residential real estate mortgage markets. The company follows a different approach than traditional property-owning REITs. Instead of owning physical properties, its business model revolves around a more risk-oriented strategy. Unlike real estate, which is bought and sold less frequently, AGNC Investment’s assets are actively traded, making the value of its bond holdings highly sensitive to interest rate fluctuations. In contrast, property prices tend to be more stable. In addition, factors such as mortgage repayment rates and housing market conditions influence its performance. Managing a portfolio of physical properties, like those held by an apartment REIT, is typically more straightforward than handling the complexities of mortgage bonds.
As a leveraged and hedged investor in Agency mortgage-based securities (MBS), AGNC Investment Corp. (NASDAQ:AGNC)’s return potential is strongest when the spreads between Agency MBS and benchmark rates are wide and stable, and when interest rates and monetary policy remain less volatile. The company’s year-to-date performance, reflecting a 13.8% unannualized economic return, highlights the advantages of its active portfolio management and the improving macroeconomic conditions. In addition, it ended the quarter with over $507 available in cash and cash equivalents.
AGNC Investment Corp. (NASDAQ:AGNC) initiated its dividend policy with quarterly payouts in 2008 and shifted to monthly dividends in 2014. Since its IPO in May 2008, the company has returned $13.4 billion to shareholders through dividends, which makes it one of the best dividend stocks on our list. Currently, it pays a monthly dividend of $0.12 per share for an attractive dividend yield of 15.43%, as of December 28.
AGNC Investment Corp. (NASDAQ:AGNC) was also a hedge fund favorite at the end of Q3 2024 with 24 funds owning stakes in the company, up from 19 in the previous quarter, as per IM’s database. These stakes have a total value of over $230.3 million. Ken Griffin’s Citadel Investment Group was the company’s leading stakeholder in Q3.
3. SL Green Realty Corp. (NYSE:SLG)
Number of Hedge Fund Holders: 24
SL Green Realty Corp. (NYSE:SLG) is an American real estate investment trust company that is the largest office landlord in Manhattan. The company specializes in acquiring, managing, and enhancing the value of commercial properties in Manhattan. As of September 30, 2024, SL Green owned interests in 55 buildings, covering a total of 31.8 million square feet. This includes ownership of 28.1 million square feet of Manhattan properties and 2.8 million square feet tied to debt and preferred equity investments. The stock has performed exceptionally well in 2024, surging by over 41% in the past 12 months.
In the third quarter of 2024, SL Green Realty Corp. (NYSE:SLG) reported revenue of $157 million, which showed a 4% growth from the same period last year. The revenue also surpassed analysts’ estimates by $4.29 million. Its same-store cash net operating income (NOI), including the company’s share from unconsolidated joint ventures, rose by 2.9%, while it increased by 0.1% for the first nine months of 2024. As of September 30, 2024, Manhattan’s same-store office occupancy reached 90.1%, including leases signed but not yet started. The company expects this occupancy will rise to 92.5% by December 31, 2024, including those leases.
SL Green Realty Corp. (NYSE:SLG) faced a decline in its dividend last year due to lower occupancy rates during the pandemic. However, with the company now recovering, investors can feel more confident in its steady monthly dividend payments. On December 6, it declared a 3% hike in its monthly dividend to $0.2575 per share. As of December 28, the stock supports a dividend yield of 4.66%.
With a collective stake value of more than $224.6 million, 24 hedge funds held positions in SL Green Realty Corp. (NYSE:SLG) at the end of Q3 2024, according to Insider Monkey’s database. In the previous quarter, 20 funds held investments in the stock.
2. STAG Industrial, Inc. (NYSE:STAG)
Number of Hedge Fund Holders: 26
STAG Industrial, Inc. (NYSE:STAG) is an American real estate investment trust company that has a diversified portfolio of industrial properties, including warehouses and light manufacturing facilities. These properties are leased to high-quality tenants through long-term contracts, with rents increasing annually by an average of 2.8% in 2024. The strong demand for industrial real estate, driven by the rise of e-commerce and the trend of bringing manufacturing back to local markets, has allowed the company to secure significantly higher rental rates when existing leases expire. In 2024, new and renewed leases for the same spaces are seeing rental increases of 30%.
In the third quarter of 2024, STAG Industrial, Inc. (NYSE:STAG) reported revenue of $190.7 million, up 6.4% from the same period last year. The revenue exceeded analysts’ estimates by $1.82 million. During the quarter, the company generated Cash Available for Distribution of $88.0 million. It also acquired six buildings totaling 613,839 square feet for $113.0 million, achieving a Cash Capitalization Rate of 6.7% and a Straight-Line Capitalization Rate of 7.2%. As of September 30, 2024, the company achieved an overall occupancy rate of 97.1% across its entire portfolio, with the operating portfolio reaching an occupancy rate of 97.8%.
STAG Industrial, Inc. (NYSE:STAG) offers a monthly dividend of $0.1233 per share and has a dividend yield of 4.37%, as of December 28. It is one of the best dividend stocks on our list as the company has never missed a dividend since 2011.
As per Insider Monkey’s database of Q3 2024, 26 hedge funds were bullish on STAG Industrial, Inc. (NYSE:STAG), compared with 28 in the previous quarter. The stakes held by these funds have a total value of nearly $142 million.
1. Agree Realty Corporation (NYSE:ADC)
Number of Hedge Fund Holders: 26
Agree Realty Corporation (NYSE:ADC) is one of the most favored REITs in 2024, surging by nearly 11% in the past 12 months. It is a well-managed net lease REIT, where tenants are responsible for most of the property’s operating costs. Over the past decade, the company has experienced strong growth, with its dividend rising by approximately 6% annually. The portfolio has expanded significantly, growing from 130 properties at the end of 2013 to 2,271 properties by the end of the third quarter of 2024.
Agree Realty Corporation (NYSE:ADC) is considered one of the strongest names in the retail sector. Its major tenants include top retailers like Walmart, Tractor Supply, Dollar General, Best Buy, TJX, Dollar Tree, Lowe’s, and Kroger, which together make up about one-third of the REIT’s annual rental income. The remaining two-thirds of its tenants are also resilient businesses. This strength is reflected in the fact that, as of September, 99.6% of its properties were fully occupied by paying tenants. In the third quarter of 2024, the company posted revenue of $154.3 million, which grew by nearly 13% from the same period last year. During the quarter, it also invested approximately $237 million in 93 retail net lease properties.
Agree Realty Corporation (NYSE:ADC) is one of the best dividend stocks on our list as the company has paid regular dividends to shareholders since its IPO in 1994. Its monthly dividend currently sits at $0.253 per share for a dividend yield of 4.32%, as of December 28.
Insider Monkey’s Q3 2024 data indicated 26 hedge fund positions in Agree Realty Corporation (NYSE:ADC), up from 23 in the previous quarter. The stakes owned by these funds are valued at roughly $565 million in total. With over 3 million shares, Long Pond Capital was the company’s leading stakeholder in Q3.
Overall, Agree Realty Corporation (NYSE:ADC) ranks first on our list of the best dividend stocks that pay monthly dividends. While we acknowledge the potential for ADC to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ADC but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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