Dividend yields are a driving priority among many investors, especially retirees and others who are dependent on dividend income for paying living expenses. An emerging secondary demographic consisting of Gen-Z and some Millennials who use high monthly dividends in a dividend compounding program for wealth building purposes has also arisen.
Exchange Traded Funds (ETF) and Closed End Funds (CEF) that pay high monthly dividends are numerous and offer a wide range of choices. Individual stocks with track records of paying high dividends are harder to find. Individual high yielding stocks paying on a monthly basis are rarer still.
In order to identify a stock that can pay a high yield monthly dividend, there are only a few industries that are able to generate such high income from which to search: real estate, business development companies, and commodity and energy. All three of these industries involve regular monthly cash flows generated through rent rolls, interest payments, monthly billing, etc.
Although they are not household names, the following five (5) stocks are worth consideration for a portfolio seeking high monthly income, should something apart from CEFs or ETFs be desired. For the sake of easy calculation, yields and dividend amounts are presented based on a $10,000 investment. All quotes are based on market prices at the time of this writing.
Orchid Island Capital
Orchid Island Capital is located in Vero Beach, FL.
Stock #1 : Orchid Island Capital (NYSE: ORC)
Yield: 19.17%
Shares for $10,000: 1,342
Annual dividend Income: $1,917
Monthly dividend Income: $159.75
In order to go public in the US capital markets, Real Estate Investment Trusts (REIT) are required to fork over 90% of their profits. That said, the REIT sector has several aspects and specialties – and not all of them involve direct, bricks and mortar real estate to classify as a REIT, such as the popular Realty Income Corp. (NYSE: O), which is best known for its huge 15,000 triple net lease commercial properties portfolio.
Headquartered in Vero Beach, FL, Orchid Island Capital, Inc. is a REIT that specializes in investments of Residential Mortgage Backed Securities (RMBS). Within its $7.61 billion AUM portfolio, there are single resident mortgages, collateralized mortgage obligations (CMO), mortgage pass-through certificates, as well as interest-only, principal-only, and other types of securities and mortgage related paper. Orchid Island Capital focuses solely on real estate paper; it has zero involvement with physical properties, so it operates more like a sophisticated portfolio manager than a conventional REIT. However the profit remittance requirement to shareholders makes for a hefty 19.17% yield.
CEO Robert Cauley had prepared in advance of the reciprocal tariff announcements from the White House earlier in March. Holding high cash reserves and keeping leverage low, this strategy limited the need for deleveraging and enabled ORC to repurchase over 1.1 million shares at a steep discount early in the quarter. He also generated a cash buffer through selective share sales. The stock has risen 25% since April, and ORC is viewed as one of the safer paper portfolio focused REITs in the industry.
Armour Residential REIT, Inc.
Armour Residential REIT, Inc. devotes its entire $16.2 billion portfolio to US government backed mortgage securities or US Treasury bonds.
Stock #2: Armour Residential REIT, Inc. (NYSE: ARR)
Yield: 18.29%
Shares for $10,000: 641
Annual Dividend Income: $1,829
Monthly Dividend Income: $152.42
The federal government backed mortgage securities industry is certainly in healthy shape, with the total market now grown to an estimated $1.6 trillion. Founded in 2008, Maryland headquartered Armour Residential REIT, Inc. has grown its AUM to over $16.2 billion and has paid out in excess $2.5 billion in dividends since its inception. ARR is a real estate investment trust that also manages a portfolio of US agency backed mortgage securities from Freddie Mac, Fannie Mae, and Ginny Mae. The company also will hold US Treasuries at any given time.
The company’s top 3 institutional shareholders are: Blackrock (14.17% of outstanding shares); Vanguard (9.66%); State Street Corp. (2.99%). Despite analyst’s forecasts that ARR has a high book to value ratio and is probably too expensive at present prices, this is based on its portfolio revenues, since ARR manages no physical property. Should the price take a dip, it could be a buying opportunity to lock in a slightly higher yield. Given that ARR’s holdings are entirely AAA rated US government-backed securities or direct issues, its likelihood of insolvency is negligible.
Pennant Park Investment Corporation
Pennant Park Investment Corp. is a BDC that fills a crucial sector of finance for small and medium-sized businesses.
Stock #3: Pennant Park Investment Corporation (NYSE: PNNT)
Yield: 14.88%
Shares for $10,000: 1,540
Annual Amount Income: $1,488
Monthly Amount Income: $124.00
The Business Development Corporation sector has surged hugely in the aftermath of the 2008 subprime mortgage banking meltdown. Due to the institutions that were closed and absorbed by others, millions of small and middle sized companies were deemed too small for the JP Morgan Chases and Bank of Americas to be worth retaining. As a result, these businesses were left with few to zero financing options for such routine financial services, such as revolving credit lines, trade receivables financing, invoice manufacturing finance, and a litany of others. BDCs that previously operated in only niche markets stepped up to fill the void. The BDC industry has expanded and grown commensurately, from a mere 21 registered companies and an estimated $30 billion AUM in 2008 to over 150 companies and over $400 billion AUM as of earlier in 2025.
In general, Pennant Park considers financings and investments of between $10 million and $100 million in companies with EBITDA of between $10 million and $50 million, but it can go up to $250 million. A key strategic point of PNNT underwritings is that they are over 90% floating rate debt, so as interest rates were high, it allowed the company to replenish its war chest for growth. Now that the trend is for interest rates to fall, PNNT has more attractive rates to offer to its clients for further business.
Stellus Capital Investment Corp.
Stellus Capital Investment is a BDC based out of Houston, Texas.
Stock #4: Stellus Capital Investment Corp. (NYSE: SCM)
Yield: 13.19%
Shares for $10,000: 813
Annual Dividend Income: $1,319.00
Monthly Dividend Income: $109.92
Participating in both the private corporate debt and equity markets, Houston, TX headquartered Stellus Capital Investment Corp. is a BDC that finances deals for American and Canadian companies with EBITDA between $5 million and $50 million. Their origination underwritings may manifest in several configurations, such as first lien, second lien, unitranche, and mezzanine debt, often accompanied with an equity portion.
Stellus Capital has a trading range cycle between $11 and $16 since 2022. At present, it is on the lower end of the range, but call option activity since August gives some trading indication that the upswing part of the cycle is gearing up again.
Cross Timbers Royalty Trust
Cross Timbers Royalty Trust pays monthly dividends from the profits derived from oil and gas properties in New Mexico, Texas, and Oklahoma.
Stock #5 : Cross Timbers Royalty Trust (NYSE: CRT)
Yield: 10.47%
Shares for $10,000: 1,402
Annual Dividend Income: $1,047.00
Monthly Dividend Income: $87.25
Dallas, TX based Cross Timbers Royalty Trust serves in a trust capacity to handle 90% of net profits from oil and gas producing properties in Texas, New Mexico and Oklahoma. The predominant area is the San Juan basin, which gives 90% of profits from New Mexico, and then 75% of profits from Texas and Oklahoma properties make up the balance. The trust debuted in 1992.
Although it has a relatively innocuous presence, and is over 90% held by individual investors, Cross Timbers has caught the attention of some institutions, with Mraz Azerine and Associates, LLC being the largest shareholder, at 0.67% of outstanding shares. Morgan Stanley owns a 0.63% stake in CRT stock as well, followed by O’Shaughnessey Asset Management LLC at 0.44% and UBS Group AG at 0.38% .
Certainly, ETFs and CEFs offer the risk mitigation quality of diversification – an aspect that many investors prefer, especially those with insufficient bandwidth to monitor their portfolio holdings on a regular basis. However, for those investors who prefer monitoring a handful of individual stocks, those who seek high-yielding ones can consider these – which can be rejected for specific reasons, but should not be ignored during the evaluation process.
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