The 3 Best Monthly Dividend Stocks for Reliable Cash Flow

Most dividend-paying corporations distribute cash flow to their investors every quarter. If you want to receive monthly dividend payouts, you can diversify across a few dividend stocks that each pay in a different month of the quarter.

For instance, a stock that pays a dividend in January likely pays it out in April, July, and October as well. Then, you can pair this stock with one dividend stock that pays in February and another dividend stock that pays in March.

This strategy works and can generate dividend income every month, but it’s also complicated. If you want an easy route to monthly dividends, you can narrow your focus to corporations that pay out monthly dividends. These are some of the top monthly dividend stocks to consider for reliable cash flow.

Main Street Capital (MAIN)

Main Street Capital (NYSE:MAIN) is a business development company that lends money to small businesses. The firm has specific criteria for any investment. A company must produce between $10 million and $150 million in annual revenue plus an annual EBITDA between $3 million and $20 million.

The firm also makes equity investments in some of its holdings. Main Street Capital’s portfolio includes 176 cumulative investments, which help the company pay monthly dividends to investors.

The yield currently stands at 5.21%, and that goes along nicely with an 18% return over the past year. It’s important to note that Main Street Capital and the other picks on this list have non-qualified dividends, which are treated as ordinary income for tax purposes. 

Stag Industrial (STAG)

Stag Industrial (NYSE:STAG) is a real estate investment trust that specializes in warehouses. Many of its clients commit to long-term leases, and it’s more of a pain for these clients to move than a person who rented an apartment unit for a year.

Stag Industrial has gained 12% year-to-date and has a dividend yield of roughly 4%. Top-line growth came in at close to 10% year-over-year in the first quarter as the company continued to capitalize on new opportunities. Stag Industrial also boosted its core funds from operations by 3.4% year-over-year.

Stag Industrial has an impressive 95.9% occupancy rate for its portfolio. The firm has the infrastructure in place to support clients who tend to stick around for a while. Any rate reductions will make it easier for the company to acquire properties and serve more customers. 

Realty Income (O)

Realty Income (NYSE:O) is another real estate investment trust. It focuses on NNN lease properties and works with various corporations. The tenants are reliable, and some of them have been making monthly payments for decades. Realty Income is a fan-favorite among dividend income investors.

The stock has a 5.56% yield and is up by about 10% year-to-date. In a recent presentation, the company stated that 91% of its rent is resilient to economic downturns. Shares only dropped by about 11% in 2022 when the economy dealt with rising interest rates and inflation. However, the actual loss is lower than that if you factor in the company’s dividend.

Realty Income’s dividend is a major selling point. The yield is high, but Realty Income has also raised its dividend for more than 30 consecutive years. Realty Income’s rental income is diversified across 1,598 clients in 91 

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