Is financial freedom possible? Here’re six dividend stocks to explore

Highlights

• Prospect Capital’s (NASDAQ: PSEC) dividend yield is 8.79%, and annualized dividend is US$0.72. The stock gave around 52% return YTD.
• Horizon Technology Finance Corporation (NASDAQ: HRZN) has a current dividend yield of 6.99%. Horizon gave a 29.31% return YTD.
• Main Street Capital Corporation’s (NYSE: MAIN) dividend yield is 5.85%; the stock gave a 32.46% return YTD.

Companies pay dividends to shareholders from a part of their income. But not all companies pay dividends. For instance, some firms reinvest the money in the business, which can help reap a fat profit as the stock value grows.

Typically, companies pay quarterly dividends; however, some companies pay dividends every month. These are majorly real estate investment trusts and investment management companies, but they could be other types of businesses too.

Here we discuss six such companies that pay monthly dividends.

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Realty Income Corporation (NYSE: O) owns nearly 6600 properties, including freestanding, single-tenant, and triple-net-leased retail properties. It has leased its properties to around 250 tenants from 47 industries.

Its market capitalization is US$27.46 billion, and its P/E ratio is 71.32. Realty Income’s dividend yield is 4%, the annualized dividend is US$2.83, and the beta is 0.75. 

Its revenue for the June quarter of 2021 was US$464.28 million, and the net income was US$124.48 million or US$0.33 per diluted share. The revenue and net income were US$414.64 million and US$107.82 million, or US$0.31 per diluted share, respectively, a year ago.  

Its year-to-date return is 13.89%. The closing price of the stock on Aug 11, 2021, was US$70.91.

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Source: Pixabay

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Main Street Capital (NYSE: MAIN) provides customized debt and equity financing and debt capital to lower middle-market companies and middle-market companies, respectively.

This investment firm has a market capitalization of US$2.93 billion and a P/E ratio of 9.28. Its current dividend yield is 5.85%, the annualized dividend is US$ 2.46, and its beta is 1.51.

The interest income was US$45.9 million, dividend income was US$18.62 million, and fee income was US$2.73 million, totaling an investment income of US$67.29 million. Net investment income was US$42.4 million or US$0.66 per diluted share. The net asset value was US$23.42 per share. 

The stock closed at US$42.52 on Aug 11, 2021. MAIN gave around 32.46% return YTD.

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Stag Industrial, Inc. (NYSE: STAG) is a real estate investment trust (REIT). It is engaged in acquiring and operating industrial properties for a single tenant.

With a market capitalization of US$6.7 billion and a P/E ratio of 37.31, the trust pays dividends at a yield of 3.49%. Its annualized dividend is US$1.45. The beta for the stock is 0.9. STAG’s revenue for the quarter ended June was US$138.43 million compared to US$117.62 million for the same period a year ago. The net income was US$32.58 million or US$0.20 per diluted share against 149.03 million or US$0.12 per diluted share in the June quarter of 2020.

The stock grew 32.50% YTD and closed at US$41.24 on Aug 11.  

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Gladstone Capital Corporation (NASDAQ: GLAD) is an externally managed management investment company that is non-diversified and closed-ended.

Its market capitalization is US$399 million and has a P/E ratio of 6.15. GLAD has a current dividend yield of 6.69% and annualized dividend of US$0.78. The beta score for the stock is 1.45.

For the June quarter of 2021, the total investment income was US$13.7 million compared to 11.7 million in the same quarter the previous year. The net investment income was US$6.6 million. The net asset value per common share was US$8.52 as of June 30, 2021. 

GLAD stock’s year to date return is 31.49%. The stock closed at US$11.65 on Aug 11, 2021.

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Horizon Technology Finance Corporation (NASDAQ: HRZN) is a specialty finance company. Its focus is to generate return through current income from debt instruments and capital appreciation from warrants.

It has a market cap of US$351 million and a P/E ratio of 29.27. The current dividend yield is 6.99%, and annualized dividend is US$1.20. It has a beta score of 1.1.

Its total investment income for the June quarter was US$13.49 million compared to US$13.52 million in the year-ago period. The net investment income was US$6.11 million or US$0.31 per share, and the net asset value was US$11.20.

Its portfolio grew quarter-over-quarter to US$404 million.

Horizon gave a 29.31% return YTD and closed at US$17.12 on Aug 11, 2021.

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Prospect Capital Corporation (NASDAQ: PSEC) is a closed-end investment company. It invests in debt and equity to generate both current income and long-term capital appreciation.

The market capitalization of the company is US$3.19 billion, and the P/E ratio is 3.53. Its current dividend yield is 8.79%, and its annualized dividend is US$0.72. The beta score for the stock is 0.95.

The company’s third quarter ended on March 31, 2021. Its total investment income was US$159.46 million compared to US$154.5 million in the March quarter of 2020. The net investment income was US$73.4 million compared to US$68.48 million in the same quarter the previous year. Its net asset value per common share was US$9.38. 

The stock closed at US$8.22 on Aug 11, 2021. It gave around 52.40% return YTD. 

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Source: Pixabay

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Bottom Line

Dividend income seekers are primarily people who want regular income at regular intervals. The higher is the frequency, the more is the dependability. Monthly income payer companies are mainly big companies with a regular income source to pass on as monthly dividends to their shareholders. However, dividends could be more attractive when the interest rates are low.