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Monthly Dividend-Paying Stocks Can Help Boost Your Income

Long before I became a stock analyst and newsletter writer… I got my start as a real estate developer.

For over two decades, I built commercial properties for companies like CVS (CVS), Dollar General (DG), and Advance Auto Parts (AAP). Some of those locations, I sold right to the companies.

Others, I kept to lease. That’s how I grew used to getting rent checks in the mail every month.

And let me tell you, it’s a great feeling.

At the peak of my landlord career, I had over 100 payments coming in 12 times a year.

Most were from high-quality tenants, too. So I rarely had to remind them to pay, much less send out default letters.

That was intentional on my part. I vetted potential lessees up and down to avoid just that. It’s one of the most important rules of being an intelligent investor.

Naturally then, it’s one I kept when I became a market analyst. And my team at Intelligent Income Daily is just as laser-focused at vetting companies and finding reliable income-producing investments.

Today, I want to show how you can collect your own “monthly rent checks” from strong tenants – just like I’ve done throughout my career – simply by owning the right stocks.

These payouts could help you boost your income stream year after year. And I’ll share one name in particular that’s trading on the cheap.

Dividend-Paying Stocks Work Well – Both When Spending and Saving

Owning a portfolio of companies that deliver predictable income can help you save up for retirement… pay your mortgage… buy groceries… or put gas in your car.

All things that are, unfortunately, more expensive now than they’ve been in decades. That’s especially true with the inflation rate hovering at 8.52% instead of the long-term average of 3.26%.

That makes owning dividend-paying stocks more important than ever – both for those who are retired and can’t rely on Social Security payments alone to meet their needs…

And for those still working.

If you’re retired, you can use the extra income to supplement your day-to-day expenses. And if you don’t need to rely on passive income just yet… you can start using dividends to save up much more than you otherwise could.

Consider the power of compounding: the concept of getting interest on interest. This happens best when you keep reinvesting dividend payments right into the stocks that gave them to you.

As you do, you buy more shares. And as you buy more shares, you get more dividends. Which you then reinvest to buy more shares.

It’s a beautiful cycle. Though it does require time and patience to really pay off.

The more of both, the better.

A Monthly Payer I Love to Own

As for me, I find dividend-paying stocks to be universally good investments – or about as much so as any group can be.

That’s why I never waste an opportunity to talk about them. Or about my favorite type of dividend-paying stock, real estate investment trusts (REITs).

If you’ve been following me here at Intelligent Income Daily, you’ve seen me write about REITs before. They’re dividend-paying stocks because they have to be.

By law, they must pay out at least 90% of their taxable income to shareholders…

Which means they often pay higher dividend yields than non-REITs. And reliable ones at that.

Today, I’ll share one of my favorite REIT holdings – that pays out a monthly dividend instead of a quarterly one.

One benefit of dividend payers on this schedule is they help people budget their monthly expenses. I know many investors who like getting these types of “monthly rent checks” so they can match-fund their living expenses with their monthly income.

If that’s something that interests you, one name I suggest paying attention to is STAG Industrial (STAG).

It’s a warehouse landlord that owns 559 properties across 40 states. That’s 559 monthly rent checks from companies like:

  • Amazon (AMZN)

  • FedEx (FDX)

  • Temper Sealy

  • Penguin Random House

  • And more.

It’s diversified… expects to see some of the highest warehouse demand it’s ever seen… and has a 4.8% dividend yield that’s expected to grow 9% this year.

But what makes it a bargain today is its price-to-funds-from-operations (P/FFO) metric – essentially real estate companies’ version of price-to-earnings. Generally speaking, a lower P/FFO ratio indicates a better value.

And right now, STAG’s P/FFO is 14.1x, compared to its five-year range of 16.3x.

Clearly, you don’t have to be a landlord to collect monthly payments from some of the strongest commercial tenants out there.

Through REITs, we can target the three fundamentals every income investor looks for: stability, reliability, and predictability.

That’s what I used to look for in my developer days… and what I continue to help you find today.

Happy SWAN (sleep well at night) investing,

Brad Thomas
Editor, Intelligent Income Daily