Which Monthly Dividend Stocks Have the Fastest Growth?

TL;DR

The five monthly dividend stocks with the fastest growth rates include Main Street Capital, Gladstone Investment Corporation, Realty Income, Cross Timbers Royalty Trust, and US Global Investors. These stocks showcase consistent increases in payouts, with growth rates averaging 9% annually and yields around 7%. Particularly, US Global Investors stands out with a remarkable 22% annualized growth from a low starting point.

Transcript

hey bowtie Nation Joseph Hogue here in the middle of an apocalypse in monthly dividend stocks more than half the 60 monthly payers I follow have cut their dividends some down to just pennies per share but I found five monthly dividend stocks that have grown their payout an average of nine percent a year and pay an average seven percent yield I'll c... Read More

Key Insights

• ✳️ Main Street Capital's diverse portfolio of investments reduces the risk of any one investment negatively impacting its dividend payments.
• ✋ Gladstone Investment Corporation's higher equity share in its investments contributes to higher returns, but also carries higher risk.
• 🏪 Realty Income's portfolio of retail properties includes safer types of retail, such as convenience stores and drug stores, which support its consistent dividend growth.
• 🛢️ Cross Timbers Royalty Trust has benefited from strong oil prices, but future dividend growth may be uncertain due to potential changes in the oil industry.
• 🥳 US Global Investors' future dividends rely on the ability of its funds to attract investors and charge sustainable expense ratios.
• 💐 Monthly dividend stocks provide a consistent cash flow for investors and can be a valuable addition to an investment portfolio.
• 🧑‍⚕️ The sustainability of a dividend depends on various factors, including the company's financial health, industry-specific trends, and overall economic conditions.

Questions & Answers

Q: Why are monthly dividend stocks important during an economic downturn?

Monthly dividend stocks provide a consistent cash flow for investors, even in uncertain times. They can provide a steady income stream and potentially grow their dividends over time.

Q: What is a Business Development Corporation (BDC)?

A BDC is a type of investment company that provides funding to small and mid-sized businesses in the form of loans and equity investments. They are known for paying out regular dividends to their shareholders.

Q: How can investors determine the sustainability of a dividend?

One way to determine dividend sustainability is by comparing the average yield on the company's investments with its dividend yield. If the average yield is significantly higher, it could indicate potential risks to the dividend's sustainability.

Q: What factors should investors consider when evaluating monthly dividend stocks?

Investors should consider the company's history of dividend growth, the industry-specific factors that could affect its cash flow, and the overall economic trends. Additionally, it's important to analyze the company's financial statements and look for signs of long-term commitment to dividend payments.

Summary & Key Takeaways

• Main Street Capital (main) is a Business Development Corporation (BDC) specializing in loans and equity investments into mid-sized businesses, with a 3.4 percent annual dividend growth and a 7.1 percent dividend yield.

• Gladstone Investment Corporation (g-a-i-n) has a higher equity share than other BDCs, leading to higher returns. It has a 3.6 percent annual dividend growth and a 7.6 percent dividend yield.

• Realty Income (oh) is a retail real estate owner with a diversified portfolio and consistent dividend growth of 3.75 percent annually, supported by stable lease terms and high occupancy rates.

• Cross Timbers Royalty Trust (CRT) has benefited from strong oil prices, growing its dividend by 12.5 percent annually. However, future dividend growth may be uncertain due to potential changes in oil prices.

• US Global Investors (g-r-o-w) is an asset manager that specializes in actively managed stocks and bond strategies. It has a 22 percent annualized dividend growth over the last five years but future dividends depend on the company's ability to bring in investors.