If you’re retired and looking for your investment portfolio to provide an income stream, the biggest thing you’re looking for is consistency. And that’s what you’ll get from quality monthly dividend stocks.
Unlike a dividend stock that pays out quarterly, annually or irregularly, monthly dividend stocks provide retirees with a consistent cash flow to help cover their living expenses. The downside of smaller payouts is more than set off by the convenience of a monthly amount that can help them with budgeting and financial planning.
And if you’re still looking to reinvest your dividend payouts rather than spend them, monthly dividend stocks have that advantage as well. Because when you get checks more often from the company as a payout, you can reinvest it in the stock of your choosing rather than waiting for a quarterly check.
Today I’ve used the Portfolio Grader and the Dividend Grader to help evaluate stocks to choose the best monthly dividend stocks you can buy in February 2024. We evaluate these stocks based on their growth, earnings performance, momentum, analyst sentiment, and dividend history.
Each of these stocks will provide a good foundation for a retiree’s retirement portfolio.
PennantPark Floating Rate Capital (PFLT)
PennantPark Floating Rate Capital (NYSE:PFLT) is a business development company or BDC. As such, it has a structure that returns 90% of taxable income back to shareholders. This makes BDCs ideal choices for monthly dividend stocks.
PennantPark invests in middle-market private companies through first-lien debt that’s secured through collateral, so there’s little risk to PennantPark (or its investors) should the debtor fall behind in payments.
Its current portfolio includes $1.27 million in assets, with $1.09 million of first lien secured debt. In the fourth quarter of 2023, it invested $302.6 million into 13 new and 34 existing portfolio companies with an average interest rate of 11.9%.
That kind of return should keep the income rolling in for investors. PennantPark stock provides a dividend yield of 11%, and gets “B” ratings in both the Portfolio Grader and the Dividend Grader.
Main Street Capital (MAIN)
Based in Houston, Main Street Capital (NYSE:MAIN) is an equity firm that invests in lower and middle-market private companies. It’s put money into more than 200 companies in its history that are looking for financial help or money to grow their businesses.
Its most recent investment is with an unnamed dental service organization in the Midwest. Main Street says it and a co-investor partnered on a deal with Main Street funding $12.8 million in first lien, senior secured term debt and a direct equity investment.
Main Street pays a monthly dividend of 24 cents per share, which at current prices would be a dividend yield of 6.4%. But it also has occasional supplemental dividend payouts, like the one declared on Feb. 20 at 30 cents per share.
MAIN stock is up 11% in the last 12 months. It gets “B” ratings in both the Portfolio Grader and the Dividend Grader.
Gladstone Investment Corp. (GAIN)
Gladstone Investment Corp. (NASDAQ:GAIN) is another business development company. This one, based in Virginia, is focused on investing in mature lower middle-market companies that have an EBITDA between $4 million and $15 million.
The company typically invests in manufacturing companies, consumer products and business and consumer services. Currently, it counts 25 investments in its portfolio.
Earnings for the fiscal third quarter of 2023 (ending Dec. 31, 2023) showed income of $23 million, up 13% from a year ago. The company has $902.8 million in investments right now, including a new investment of $64.7 million in the most recent quarter.
As the economy continues to strengthen and the risk of recession falls, companies like Gladstone will be in greater demand to support companies that are looking to expand their wings. GLAD stock has a dividend yield of 6.8% and gets “B” ratings in the Portfolio Grader and the Dividend Grader.
Apple Hospitality REIT (APLE)
Apple Hospitality REIT (NYSE:APLE) is a real estate investment trust based in Virginia. The company has a niche of investing in upscale hotel properties in the U.S.
Currently, Apple has a portfolio of 225 hotels and 29,900 guest rooms throughout 38 states. The company’s investments include 100 hotels branded by Marriott (NASDAQ:MAR), 120 Hilton (NYSE:HLT) hotels and five hotels branded by Hyatt (NYSE:H).
In December, the company bought its latest hotel, a Marriott-branded property at the Las Vegas Convention Center.
Americans haven’t lost their thirst for travel. In fact, it seems people are more eager to travel these days after being locked down by the coronavirus for much of 2020 and 2021.
Revenue for the third quarter of 2023 was $58.5 million, down 1.1% in the last year. But even with that lack of growth, Apple Hospitality is a reliable monthly dividend stock, with a yield of 6%.
It gets a “C” rating in the Portfolio Grader, but an “A” rating in the Dividend Grader.
Gladstone Capital Corp. (GLAD)
No, you’re not experiencing déjà vu. While GAIN stock represents Gladstone Investment Corp., we also have Gladstone Capital Corp. (NASDAQ:GLAD). Gladstone Management manages both, but they have different aims.
Gladstone Investment seeks majority ownership of companies to enhance operations and create value, while Gladstone Capital supports buyouts and provides capital for growth objectives.
Its current portfolio includes everything from restaurants, manufacturers, healthcare companies, defense and aerospace companies.
Earnings for the fiscal first quarter ending Dec. 31, 2023, included revenue of $23.2 million, down 2.3% from a year ago. But the monthly dividend payment remained strong at 8.25 cents per share per month for common shareholders, and 13 cents per month for preferred shareholders.
Overall, GLAD stock has a dividend yield of 9.7%, giving it a “C” rating in the Portfolio Grader and an “A” rating in the Dividend Grader.
U.S. Global Investors (GROW)
U.S. Global Investors (NASDAQ:GROW) is an investment management company that actively manages equity and bond products.
The company provides eight no-load mutual funds focusing on emerging markets, precious metals, bonds and domestic funds.
U.S. Global also has two exchange-traded funds: the U.S. Global Jets ETF (NYSEARCA:JETS) and the U.S. Global Go Gold and Precious Metal Miners ETF (NYSEARCA:GOAU). JETS invests in 49 stocks related to the airline industry, while GOAU has 27 mining-related stocks in its portfolio.
Revenue in the fourth quarter was $2.81 million, down from $3.72 million a year ago. But despite that, the company’s profits rose from 6 cents per share to 9 cents per share, and the company still put out a solid monthly dividend yield of 3.5%.
GROW stock can give you income even when the stock isn’t doing great. It gets a “C” rating in the Portfolio Grader and a “B” rating in the Dividend Grader.
PennantPark Investment Corp. (PNNT)
Another callback to a name on this list, PennantPark Investment Corp. (NYSE:PNNT) is another BDC.
PNNT, like PennantPark Floating Rate Capital, is managed by PennantPark Investment Advisors. It focuses on investing in U.S. middle-market companies through various debt and equity investments.
PNNT has a portfolio of $1.21 million, with net accesses in the fourth quarter off $499.1 million. The company brought in $15.7 million in the quarter, or 24 cents per share, and paid out a total of 21 cents per share in distributions.
PNNT stock has the best dividend yield on the list, with a payout of 12.6%. The stock is also up 30% in the last year, contributing to its “B” rating in the Portfolio Grader and an “A” rating in the Dividend Grader.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
