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Investors are drawn to dividend stocks, particularly the high-yield variety, because they offer a significant income stream and the potential for massive total returns. Total return encompasses interest, capital gains, dividends, and distributions realized over time. The total return on an investment or a portfolio combines income and stock appreciation.
For example, if you buy a stock at $20 that pays a 3% dividend, and it goes up to $22 in a year, your total return is 13%. That is, 10% for the increase in stock price and 3% for the dividends paid.
Most stocks pay quarterly dividends, which is fine for many shareholders, especially those who reinvest dividends. However, many investors rely on dividends as part of a passive income stream, and getting a monthly dividend payout is more beneficial. Typically, real estate investment trusts, business development companies, and closed-end funds are among the investment vehicles that pay distributions monthly.
We screened our 24/7 Wall St. high-yield dividend research, looking for quality companies with market capitalizations of $1 billion or more that deliver monthly payouts to shareholders. We found five stocks that look like solid bargains now and are the highest-yielding monthly pay companies that size. Check out these dividend legends as well.
AGNC Investment
AGNC Investment provides private capital to the housing market in the United States.
This company has paid solid monthly dividends for years; its current yield is a massive 14.05%. AGNC Investment Corp. ( NASDAQ: AGNC ) is a real estate investment trust (REIT) in the United States.
The company invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency.
AGNC Investment funds its investments primarily through collateralized borrowings structured as repurchase agreements. It has elected to be taxed as a REIT under the Internal Revenue Code 1986. However, it would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders.
Ellington Financial
Ellington Financial is a mortgage REIT that invests in a diverse array of financial assets.
This quality mortgage REIT company is a favorite across Wall Street and pays a huge 11.91% dividend. Ellington Financial Inc. ( NYSE: EFC ), through its subsidiary, Ellington Financial Operating Partnership LLC, acquires and manages mortgage-related, consumer-related, corporate-related, and other financial assets in the United States.
The company develops and manages residential mortgage-backed securities (RMBS) backed by:
- Prime jumbo
- Alt-A, manufactured housing, and subprime residential mortgage loans
- RMBS for which the principal and interest payments are guaranteed by the U.S. government agency or the U.S. government-sponsored entity
- Residential mortgage loans
- Commercial mortgage-backed securities
- Commercial mortgage loans and other commercial real estate debt
Ellington Financial also provides:
- Collateralized loan obligations
- Mortgage-related and non-mortgage-related derivatives
- Corporate debt and equity securities; corporate loans; and other strategic investments
In addition, the company offers consumer loans and asset-backed securities backed by consumer and commercial assets.
EPR Properties
EPR Properties is a REIT based in Kansas City, Missouri, that invests in amusement parks, movie theaters, ski resorts, and other entertainment properties.
This REIT invests in some of the most popular entertainment companies and pays a solid 7.61% dividend. EPR Properties ( NYSE: EPR ) is a leading experiential net lease real estate investment trust (REIT) specializing in select enduring experiential properties in the real estate industry.
The company focuses on real estate venues that create value by facilitating out-of-home leisure and recreation experiences where consumers spend their time and money.
The company has nearly $6.7 billion in total investments across 44 states. It adheres to rigorous underwriting and investing criteria centered on key industry, property, and tenant-level cash flow standards.
Senior management believes its focused approach provides a competitive advantage and the potential for stable and attractive returns.
Apple Hospitality REIT
This REIT owns one of the largest portfolios of upscale, select-service hotels in the United States.
Apple Hospitality REIT Inc. ( NYSE: APLE ) is a publicly traded real estate investment trust that stands out in the market with its unique offering and fat 6.39% dividend.
Despite its name , it has no affiliation with the technology giant. However, it offers a solid total return potential, owning one of the largest and most diverse portfolios of upscale, room-focused hotels in the United States.
Apple Hospitality's portfolio comprises 220 hotels with over 28,900 guest rooms in 87 markets throughout 37 states and one property leased to third parties.
Concentrated on industry-leading brands, the Company's hotel portfolio comprises 97 Marriott-branded hotels, 119 Hilton-branded hotels, and four Hyatt-branded hotels.
Realty Income
Realty Income invests in free-standing, single-tenant commercial properties in the United States, Spain, and the United Kingdom.
This is an ideal stock for growth and income investors looking for a safer contrarian idea for the rest of 2024 that pays a whopping 5.48% dividend. Realty Income Corp. ( NYSE: O ) is an S&P 500 company that provides stockholders with dependable monthly income.
The company is structured as a REIT, and its monthly dividends are supported by the cash flow from over 15,540 real estate properties owned under long-term lease agreements with commercial tenants.
The company has declared 644 consecutive common stock monthly dividends throughout its 55-year operating history and increased the dividend 123 times since Realty Income's public listing in 1994. It is a top real estate member of the S&P 500 Dividend Aristocrats index.
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