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Cheap monthly dividend stocks for investors to buy right now

Cheap monthly dividend stocks

As per the report by Wisdom Tree, stock dividends saw an increase by average of ~5.7% annually since the year 1957—over 2% higher in comparison to the inflation. Experts have called such stocks “Super TIPS” since they are a hedge against inflation over the long term, together with real growth. This is true when the inflation reached its peak like during ’70s and ’80s, when inflation averaged more than ~6%. This held even during the low-inflation periods, such as in the past 3 or decades. Therefore, cheap monthly dividend stocks are the best investments for the investors wanting to invest only to beat inflation in the long run.

The report by Wisdom tree puts special emphasis on the fact that dividends are steadier in comparison to the share prices. Over the previous 64 years, dividends saw a decline in only 6 years, and saw a fall of over 5% in the single year. However, in the same time frame, stock prices have seen the decline in ~18 years. Most significant decline in a single calendar year was more than ~40%, with the average decline coming out to be over ~11%. 

The US companies have targeted to keep their dividends stable, since this what more than 80% of the investors prefer. In 3Q23, several big and renowned US companies which offer dividends have either raised their dividend pay-outs or have kept them same. As the result of this, there has been an increase of ~4.5% in the cash they distributed to the shareholders. 

Growth rate of the US dividends have slowed down for the 8 consecutive quarters because of the worries regarding the overall US economy after US Fed’s decision to increase interest rates in a bid to cool down inflation. Therefore, investors continue to spot cheap monthly dividend stocks so as to maintain balanced portfolio. The US is on the pathway to set a record for total payouts in the form of dividends in 2023, since the companies have already paid ~$146.6 billion in 3Q23 alone. 

With this in mind, let us check the cheap monthly dividend stocks for investors to buy right now.

1. Stellus Capital Investment Corporation

The company, which has a P/E ratio of ~24.3x on TTM basis, is closed-ended, non-diversified management investment company. 

While announcing its financial results for 3Q23, the company highlighted its US GAAP net investment income of $0.47 per share and core net investment income of $0.49 per share which took care of regular dividend declared of $0.40 per share.  Portfolio of the company saw an increase of net $5 million to $886 million at the fair value, with the loan portfolio yielding ~11.5% as of September 30, 2023.

Investment income for 3 months ended September 30, 2023 and 2022 totalled $27.2 million and $20.1 million, respectively. Much of this income was formed from the interest income from portfolio investments. 

During 3 months ended September 30, 2023 and 2022, the company announced aggregate distributions of $0.40 and $0.34 per share, respectively (i.e., $9.3 million and $6.6 million, respectively). The company stated that outstanding balance under its credit facility as of November 7, 2023 came in at $163.0 million. 

2. EPR Properties

EPR Properties, which has a P/E ratio of 23.51x on the TTM basis, is the real estate investment trust, leasing experiential properties in the US and Canada.

The company announced that its Board of Trustees declared monthly cash dividend to common shareholders in the form of dividend of $0.275 per common share. This amount is payable on December 15, 2023 to the shareholders who are on the register as of November 30, 2023. 

It has released its operating results for 3Q ended September 30, 2023 in which it delivered strong earnings results, with continued healthy performance at its experiential properties and strong deferral collections. Collectively, these measures contributed to the company’s increased guidance for the year. The company highlighted optimistic views regarding the ongoing stabilization of its portfolio as restructured master lease agreement with Regal became effective during 3Q, and the company saw strong recovery at box office.

Considering the company’s attractive pipeline of committed developments and investment opportunities and lower P/E (on TTM basis), it is one of the cheap monthly dividend stocks for investors to buy right now. 

The company increased its FFOAA per diluted common share guidance for 2023 from the range of $5.05 – $5.15 to the range of $5.10 – $5.18. It has narrowed its 2023 investment spending guidance $200.0 million – $300.0 million to between $225.0 million – $275.0 million. 

3. Apple Hospitality REIT, Inc.

The company is real estate investment trust, investing in income-producing real estate, mainly in the lodging sector, in the US. 

It announced results of operations for 3Q ended September 30, 2023. Performance of the company across its portfolio was strong during 3Q, and it reported comparable hotels RevPAR growth of 3% in comparison to 3Q22 as a result of improvements in comparable hotels occupancy of ~2% and ADR of 1%. As a result of strategic asset management, its strong and efficient operating model and strength in ADR, it achieved strong margins during the quarter, despite higher inflationary and wage pressures.

For 3Q23, comparable hotels RevPAR stood at $123, exhibiting 3% rise in comparison to 3Q22, comparable hotels ADR was $159, which exhibits 1% growth over 3Q22. It saw comparable Hotels Adjusted Hotel EBITDA of ~$132 million, which means that the company saw 1% improvement on year-over-year basis.

P/E ratio (on LTM basis) of the company stood at ~23.84x. 

Conclusion

The above-mentioned list of cheap monthly dividend stocks has been curated focusing on stocks having monthly dividends and that have trailing twelve-month (TTM) price-to-earnings (P/E) ratio of less than ~28.5x.  Since a lot of cheap monthly dividend stocks are from the real estate investment trust sector, there are companies which have been selected from this sector. 

The companies that have been chosen offer diverse range of dividend payment frequencies, providing the investors with options to select on the basis of their choices and investing strategies.

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CEO & Editor
I'm Ved Prakash, Founder & Editor @Newsblare Media, specialised in Business and Finance niches who writes content for reputed publication such as Investing.com, Stockhouse.com, Motley Fool Singapore, etc. I'm the contributor of different... news sites that have widened my views on the current happenings in the world.

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