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Investors seeking financial stability often turn to monthly dividend stocks to generate passive income. This article explores the best monthly dividend stocks for 2023 and explains their benefits, including long-term capital appreciation.
These stocks offer a steadier flow of income, which benefits retirement-age investors who prefer frequent distributions. They also generally provide a significant income stream.
A select group of monthly dividend stocks pays dividends at a rate of 10% or higher. Those are the ones on this list. Investors should be aware of the risks involved, such as share price fluctuations and payout rate disruptions that can change the yield in the future.
Despite these risks, some investors may be willing to pursue big and reliable paydays. If that’s the case, here are three monthly dividend stocks worth considering.
Oxford Square Capital (OXSQ)
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Oxford Square Capital (NASDAQ:OXSQ) functions as a business development company. To generate returns, it focuses on private equity investments, mezzanine financing, and senior and junior debt offerings.
Oxford Square focuses on investing in companies that are not too big or small, with annual revenues of less than $200 million. These companies are significant enough to be serious concerns but not too small to obtain financing at local bank branches.
Oxford Square’s BDC is a particularly attractive option if economic disruptions subside and inflation and supply chain disruptions are controlled. Such conditions are conducive to growth for monthly dividend stocks.
OXSQ stock has a dividend yield of 14.1% as of this writing.
San Juan Basin Royalty Trust (SJT)
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Before investing in San Juan Basin Royalty Trust (NYSE:SJT), take a moment to evaluate it.
SJT is valued at around $328 million, and its investments are in the fixed reserves of fossil fuels. Returns come from the extraction and sale of oil and gas. SJT has brought a significant portion of its reserves to market, benefiting from favorable energy prices. However, oil prices have been dropping recently, which may impact future yields.
It is important to remember that oil prices fluctuate, and SJT’s yields may not always remain at the same level. If oil prices remain firm and the San Juan Basin reserves are ample, SJT may provide a double-digit yield via monthly dividends. However, all forms of investment carry inherent risks.
At the time of writing, SJT stock has a dividend yield of 18.2%.
SL Green Realty Corp (SLG)
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SL Green Realty Corp (NYSE:SLG) is a major player in the Manhattan office market with a diversified portfolio of 60 buildings totaling 33.1 million square feet. SLG, as a real estate investment trust (or REIT), must distribute 90% of its taxable income to shareholders, resulting in regular dividend payments.
While SL Green’s monthly payout has decreased slightly from just under 32 cents per share earlier in 2022 to about 27 cents currently, the annualized yield remains significant. Therefore, it becomes a compelling alternative for investors searching for steady cash flow.
SL Green also has a solid track record and a diversified portfolio in one of the world’s most coveted real estate markets. This makes it a strong candidate for investors seeking regular income streams through monthly dividend stocks.
At the time of writing, SLG stock has a dividend yield of 15.1%.
With that said, if you want to continue reading about dividend stocks, you are in luck. My colleague Faisal Humayun wrote a great 7-stock piece worth checking out. And while you are at it, check out this piece from Chris MacDonald. Alex Sirois also recently wrote about great dividend picks.
On the publication date, Faizan Farooque did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience in analyzing the stock market and was a former data journalist at S&P Global Market Intelligence. His passion is to help the average investor make more informed decisions regarding their portfolio.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
