Investors love dividend stocks because they provide dependable income and give investors a great opportunity for solid total return. Total return includes interest, capital gains, dividends, and distributions realized over time. In other words, the total return on an investment or a portfolio includes income and stock appreciation.
Most stocks pay quarterly dividends, which is fine for many shareholders that reinvest dividends. However, many investors rely on dividends as part of a passive income stream, and getting a monthly dividend payout is more beneficial. Typically, real estate investment trusts, business development companies, and closed-end funds are among the investment vehicles that pay distributions monthly.
Real estate investment trusts, or REITs, are a great idea now, especially with the Federal Reserve likely done with rate hikes. REITs are a practical way to own commercial and residential real estate. Many pay among the best dividends of any asset class.
We screened our 24/7 Wall St. research database looking for REITs rated Buy at major Wall Street firms that also paid monthly dividends. We found five that look like great ideas for passive income-oriented investors looking for upside appreciation.
AGNC Investment
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This company has paid solid monthly dividends for years, and the current yield is a massive 15.34%. AGNC Investment Corp. (NASDAQ: AGNC) operates as a REIT in the United States.
The company invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the U.S. government-sponsored enterprise or by the U.S. government agency.
The company funds its investments primarily through collateralized borrowings structured as repurchase agreements. It has elected to be taxed as a REIT under the Internal Revenue Code 1986. It would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders.
Apple Hospitality REIT
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Another publicly traded REIT, Apple Hospitality REIT Inc. (NYSE: APLE) stands out in the market with its unique offering. Despite its name, it’s not affiliated with the technology giant. However, it offers a solid total return potential, owning one of the largest and most diverse portfolios of upscale, room-focused hotels in the United States.
Apple Hospitality’s portfolio comprises 220 hotels with over 28,900 guest rooms in 87 markets throughout 37 states and one property leased to third parties.
Concentrated on industry-leading brands, the company’s hotel portfolio includes 97 Marriott-branded hotels, 119 Hilton-branded hotels, and four Hyatt-branded hotels.
EPR Properties
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This REIT invests in some of the most popular entertainment companies and pays a solid 8.08% dividend. EPR Properties (NYSE: EPR) is a leading experiential net lease REIT specializing in select enduring experiential properties in the real estate industry.
The company focuses on real estate venues that create value by facilitating out-of-home leisure and recreation experiences where consumers spend their time and money.
The company has nearly $6.7 billion in total investments across 44 states. It adheres to rigorous underwriting and investing criteria centered on key industry, property, and tenant-level cash flow standards. Senior management believes its focused approach provides a competitive advantage and the potential for stable and attractive returns.
Realty Income
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This is an ideal stock for growth and income investors looking for a safer inflation-busting idea for 2024 that pays a stable 5.90% dividend. Realty Income Corp. (NYSE: O) is an S&P 500 company that provides stockholders with dependable monthly income.
The company is structured as a REIT. Its monthly dividends are supported by the cash flow from over 15,450 real estate properties owned under long-term lease agreements with commercial tenants.
The company has declared 644 consecutive common stock monthly dividends throughout its 55-year operating history and increased the dividend 123 times since Realty Income’s public listing in 1994. It is a top real estate member of the S&P 500 Dividend Aristocrats index.
SL Green Realty
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This is a leading large-cap office REIT that top analysts on Wall Street prefer now. It is a solid (and somewhat) contrarian play with a strong 5.68% dividend. SL Green Realty Corp. (NYSE: SLG) is a fully integrated REIT focused primarily on acquiring, managing, and maximizing the value of Manhattan commercial properties.
As of September 30, 2023, SL Green held interests in 59 buildings totaling 32.5 million square feet. This included ownership interests in 28.8 million square feet of Manhattan buildings and 2.8 million square feet securing debt and preferred equity investments.
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