I have invested in dividends for 10 years—These monthly payers keep my cash flow consistent

Dividend stocks have long been a foundation for investors seeking steady income and long-term wealth. These stocks, issued by companies that distribute a portion of profits as dividends, offer a reliable cash flow stream, making them ideal for retirees, income-focused investors, or those aiming to reinvest for compounding growth. 

Historically, dividend stocks have outperformed non-dividend peers, delivering average annual returns of around 9.2% versus 3.9% from 1973 to 2023, with lower volatility, according to Hartford Funds. They provide a hedge against inflation, as many firms raise payouts over time, and act as a buffer during market downturns. Selecting the right dividend stocks, though, requires evaluating yield sustainability, company fundamentals, and growth potential to avoid dividend traps.

Monthly dividend stocks enhance these benefits by providing more frequent payouts, aligning better with regular expenses like bills or mortgage payments. This consistent cash flow supports budgeting and offers flexibility for reinvestment, accelerating compounding. Monthly payers often come from stable sectors, ensuring reliability, but investors must still assess payout ratios and earnings to ensure durability.

Below are three monthly dividend stocks that offer long-term dividend growth and capital appreciation, providing a consistent income stream and helping to grow your portfolio.

Realty Income (O)

Real estate investment trust (REIT) Realty Income (NYSE:O) is a premier choice for investors seeking reliable monthly dividends. Known as “The Monthly Dividend Company,” O has paid consecutive monthly dividends for over 55 years, with 650 increases since its 1994 IPO. 

Its portfolio of over 15,600 properties is leased to recession-resistant tenants like Walmart (NYSE:WMT) and Dollar General (NYSE:DG), ensuring stable cash flows and supporting a current yield of around 5.7%. Realty Income’s payout ratio of 71% is sustainable as it is backed by adjusted funds from operations (AFFO) growth of 4.8% in 2024. 

Strategic acquisitions, like its $9.3 billion Spirit Realty merger in 2024, enhance the REIT’s diversification and growth. While persistently high interest rates could pressure REIT valuations, Realty Income’s low debt-to-equity ratio of 0.75 mitigates risks. For investors valuing monthly income, Realty Income’s proven track record, diversified portfolio, and growth potential make it a top pick for steady, compounding returns.

Gladstone Capital (GLAD)

Rather than a REIT, Gladstone Capital (NASDAQ:GLAD) is a business development company (BDC). It invests early in the business cycle of lower middle-market U.S. companies to capitalize on their potential.

GLAD has paid consistent monthly dividends since 2002, with its current annualized payout of $1.98 per share offering a robust 7.4% yield. Despite a first-quarter investment income dip of 1.8%, the BDC maintained its monthly dividend at $0.165 per share, reflecting its stability. Its diversified portfolio, with 90% debt and 10% equity investments, supports a sustainable 45.6% payout ratio, bolstered by $11.2 million in Q1 net investment income. 

GLAD’s focus on recession-resistant sectors such as manufacturing and services helps mitigate risk. Over the past five years, GLAD has returned 232% to investors compared to a 123% return by the S&P 500. 

Like Realty Income, rising interest rates could impact BDC valuations, but GLAD’s track record, high yield, and disciplined investments make it a strong pick for income-focused investors seeking monthly cash flow and portfolio stability.

EPR Properties (EPR)

Another REIT, EPR Properties (NYSE:EPR) specializes in experiential properties like theaters, amusement parks, and fitness centers, and is a strong pick for monthly dividend investors. 

EPR has paid consistent monthly dividends since 2013, with its current annualized payout of $3.54 per share — up 3.5% year-over-year — yielding an attractive 6.4% annually. Its first-quarter AFFO grew 8% to $1.21 per share, underscoring EPR’s diversified portfolio, with 331 properties and 99% occupancy.

The REIT benefits from long-term leases to resilient tenants like Vail Resorts (NYSE:MTN) and Six Flags Entertainment (NYSE:FUN), ensuring stable cash flows. Strategic moves, like selling $150 million in non-core assets in 2024, bolster its balance sheet, with a debt-to-equity ratio of 1.3. Over the last half decade, EPR has total returns of 184%. 

The REIT’s high yield, monthly payouts, and focus on experiential real estate make it a compelling choice for income-focused investors wanting reliable cash flow and growth potential.

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