Finding an investment that pays a dividend every single month has many benefits. Apart from it being easier to budget for, the monthly payments can help showcase the impact of compounding much quicker when compared to quarterly dividend stocks.
The real question for income investors is which investment that pays a dividend every single month is a great addition to a portfolio?
Meet the stock that pays you a dividend every single month
SmartCentres Real Estate Investment Trust (TSX:SRU.UN) is one of Canada’s largest REITs. The REIT owns over 200 properties comprising over 35 million square feet of income-producing retail and office space.
Much of that portfolio is built around value-oriented retail sites. Additionally, many of those locations are anchored by some of the largest and most recognized retailers on the market. That gives SmartCentres exposure to tenants that can keep drawing customers even when the broader economy slows.
One of the biggest examples of that strength is Walmart. In fact, over 110 of SmartCentres’ properties are Walmart-anchored centres. That relationship has been a key part of the REIT’s strategy for decades.
A Walmart anchor-tenant provides a steady flow of shoppers to a property. That makes the surrounding retail space more attractive to other tenants. For SmartCentres, that speaks to the REIT’s high occupancy and why retailers continue renewing leases.
And those properties continue to perform.
In the most recent quarter, SmartCentres reported an occupancy rate of 98.1%, reflecting an increase of 0.5% over the prior quarter. SmartCentres also leased approximately 247,000 square feet of vacant space in the quarter.
That strength is also showing up in leasing demand. In the most recent quarter, SmartCentres extended 86% of its maturing 2026 leases. Those renewals came with impressive 12% rent growth when excluding anchor tenants. With anchor tenants, those renewals came in with 6.6% rent increases.
That’s not explosive growth, but it is respectable. And with near-full occupancy across the portfolio, SmartCentres has built a pretty strong moat around its retail base.
SmartCentres lets you earn a dividend every single month
For income investors, the main draw to SmartCentres is receiving that dividend every single month.
That dividend, which as of the time of writing works out to a yield of 6.6%, is one of the better-paying options on the market. On a monthly basis, that works out to $0.15 per unit each month.
For those investors with $15,000 to invest in SmartCentres, that investment translates into a monthly income of just over $82. You can’t retire off that, but it can generate several new units each month from reinvestments alone.
Is SmartCentres a good monthly income stock to buy?
For income investors, SmartCentres checks a lot of boxes.
The 6.6% yield is attractive, especially with that income arriving every month. More importantly, the underlying portfolio continues to perform well. Occupancy remains above 98% and renewal rents are rising.
SmartCentres also has additional upside that comes in the form of developing its existing property base. That includes new retail space, residential developments, and self-storage facilities.
In my opinion, SmartCentres is a great long-term income producer to include as part of a larger, well-diversified portfolio.