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Monthly dividend REITs are solid investments
Low-risk dividend stocks are a sound investment for people looking to earn a regular income without having to worry about the market’s instability. Learn two great REITs that pay dividends every month and why you should start investing with them.
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In the current market conditions, dividend stocks are a solid and profitable choice for passive investors. Learn why below.
There are many types of low-risk investments available for people who are interested in putting their money to work without having to work themselves. Dividend stocks are one of those investments. More often than not, investors rely on those dividend stocks to shield themselves during inflationary periods and high market volatility. Companies with a stable business and cash flow usually pay out part of their earnings to shareholders as some sort of reward for their loyalty.
In a similar way, a big portion of retirees search for a source of continued stable income in the shape of dividend-paying stocks. In that particular segment, real estate investment trusts, or REITs, are the most popular. But not all REITs work the same way. Some offer dividend payments on a quarterly basis while others will pay shareholders every month. So, for investors who would like to receive their dividends in a monthly fashion, here are two REITs to consider.
Pembina Pipeline Corp (PBA)
This year really highlighted the importance of local energy producers after the war in Ukraine caused absolute chaos in energy markets around the globe. Pembina is a company that has essential energy infrastructure assets based mostly in the Western Canadian region.
Pembina’s business has three divisions: marketing and new ventures, facilities and pipelines. The pipeline division accounts for 58% of the company’s earnings, and Pembina has over 18,000km of pipelines across Canada. Pembina’s revenue was estimated at $561 million, which the company managed to beat by amassing roughly $2.41 billion of revenue.
That earnings beat was seen in the earnings per share, which jumped to $0.64 in a beat of $0.11. It allowed the company to up their dividend yield, which is currently at 4.95% and paying out a monthly $0.164 per share. On a full spectrum, PBA shares are over 30% YTD with a steady upward since the start of this year. Trading volumes have remained stable and the stock is trading well above all daily SMAs (Simple Moving Averages).
Financial analysts on Wall Street presently deem PB shares as a moderate buy. Their prediction is that the average price for the next 12 months could reach up to $42. That would mean an increase by 4.75% than its current trading price.
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STAG Industrial, Inc (STAG)
NASDAQ is officially in a bear market, and companies that are bound to high-technology groups trading in its index ended up being dragged by proxy. STAG is a REIT in the industrial segment with over 110 million square feet of real estate layed out over 550 properties in 40 states. The current market cap of the company is $6 billion, but the enterprise value of the assets is at approximately $9.9 billion.
Earnings for the first quarter of 2022 presented a YoY revenue increase of 18% to $159.20 million. The company’s earnings per share was $0.53, in a beat of $0.01. These results allowed STAG to pay out a $0.127 dividend per share every month, with a 4.38% dividend yield.
Due to investors’ fear of recession, STAG shares lost 29% YTD. However, the company’s share is still trading well and below the daily SMAs. That could represent an entry point for new dividend investors. Wall Street analysts consider STAG shares a moderate buy and predict that the average price for the next 12 months will reach $44. That is a 32.55% increase in its current trading price.
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