Most stocks pay dividends on a quarterly schedule. But some investors such as retirees might desire even more frequent dividend payments. Fortunately, there are stocks that make monthly dividend payments, which can help smooth out cash flows for shareholders.

This article will discuss three monthly dividend stocks that have monthly distributions and yields above 3%.

Prospect Capital (PSEC)

Prospect Capital Corporation is a Business Development Company, or BDC, that provides private debt and private equity to middle–market companies in the U.S. The company focuses on direct lending to owner–operated companies, as well as sponsor–backed transactions.

Prospect invests primarily in first and second lien senior loans and mezzanine debt, with occasional equity investments.

Prospect posted first quarter earnings on November 8th, 2023. Net investment income came to $126 million, while revenue was flat at $202 million. On a per-share basis, NII came to 25 cents, which was three cents ahead of estimates.

Net asset value was $9.25 per share, which was flat to the June quarter. Total originations fell to $131 million, down sharply from $372 million in the prior quarter. Originations in Q2 to date, subsequent to the end of the first quarter, were $57 million as of the earnings report. Total repayments were $94 million, down from $122 million in Q1, with Q2 to-date repayments at just $2 million.

The company’s payout ratio was over 100% for several years in the past decade but is slightly under that now given the increasing NII-per-share estimate. We are more optimistic that Prospect can fund the dividend indefinitely given the move up in earnings in recent quarters. PSEC stock currently yields 12%.

Gladstone Land Corporation (LAND)

Gladstone Land Corporation is a real estate investment trust, or REIT, that specializes in the owning and operating of farmland in the U.S. The trust owns about 160 farms, comprising more than 110,000 acres of farmable land. Gladstone’s business is made up of three different options available to farmers, all of which are done on a triple-net basis.

The trust offers long-term sale leaseback transactions, traditional leases of farmland, and outright purchases of farm properties. Gladstone’s portfolio has an appraised value of over $1.5 billion. Gladstone posted third quarter earnings on November 7th, 2023, and results were in line with expectations. FFO came to 17.6 cents per share, while revenue fell nearly 3% to $23.53 million. That was, however, $2.11 million better than estimates.

The dividend payout ratio for 2023 is expected to be approximately 86%. The dividend was raised fractionally most recently as Gladstone appears to have hit the maximum dividend it can pay until AFFO-per-share increases. The most recent increase was just 0.4%, and while the dividend increase streak is now up to nine years. LAND stock yields 4.0%.

Phillips Edison & Company (PECO)

Phillips Edison & Company is a real estate investment trust that is one of the nation’s largest owners and operators of omni-channel grocery-anchored shopping centers. Additionally, the company runs a third-party investment management business providing property management and advisory services to unconsolidated joint ventures and one private fund.

On October 31st, 2023, Phillips Edison & Company reported its Q3 results for the period ending September 30th, 2023. For the quarter, total revenues came in at $152.5 million, 4.7% higher year-over-year. Same-store NOI improved by 3.2% to $99.9 million, new and renewal leasing spreads landed at 26.3% and 16.9%, respectively, while occupancy remained at a record 97.8% - all of which were positive developments.

Phillips Edison’s FFO growth has been rather robust over the years, despite the company operating in a rather unfavorable real estate sub-sector. By creating omni-channel grocery-anchored shopping experiences, the company’s properties enjoy resilient traffic. Future growth is to be powered by accretive acquisitions, high retention rates, and a focus on increasing occupancy.

Phillips Edison’s dividend should be relatively safe at its current levels, following a healthy payout ratio. Shares currently yield 3.3%.

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Bob Ciura has worked at Sure Dividend since October 2016. He oversees all content for Sure Dividend and its partner sites. Bob received a Bachelor’s degree in Finance from DePaul University, and an MBA with a concentration in Investments from the University of Notre Dame.