The frequency of payments is important for some dividend investors because regular cash flow allows savings to grow faster. Many TSX stocks pay monthly dividends. If you want to gain exposure to the real estate industry, most real estate investment trusts (REITs) also pay monthly.
Full ownership royalties (TSX: FRU), Atrium mortgage investment (TSX: AI), and Automotive properties (TSX: APR.UN) pay above average returns. A monthly income goal of $ 1,000 is achievable over time.
Freehold Royalties is trading at $ 9.84 per share and pays a lucrative 4.85% dividend. The $ 1.29 billion oil and gas royalty company actively acquires and manages mining titles and royalties on oil and gas properties in Western Canada.
The size of its land holdings is over 6.7 million gross acres. The independent portfolio of royal lands owned by Freehold is also one of the largest in the country. This royalty company creates value by promoting oil and gas development in the land. Freehold generates gross overriding royalties through its rental programs.
The acquisition of quality assets is a permanent concern. However, acquisition targets must have acceptable risk profiles and a long economic life. In the first quarter of 2021 (quarter ended March 31, 2021), activity appears to have returned to normal, given the substantial improvements in operating and financial results compared to the first quarter of 2020.
Freehold’s royalties and other income rose 40%, while net income was $ 5.6 million compared to a net loss of $ 9 million for the same period last year.
Conservative risk parameters
The Atrium mortgage is an attractive option. This $ 622.75 million Toronto-based company provides financing solutions to real estate communities in key markets such as Alberta, British Columbia, the Greater Toronto Area and not the GTA of Ontario. The stock price is $ 14.66 (+ 19% year-to-date), while the dividend yield is 6.18% high.
The activity is stable, as evidenced by the results of the first quarter of 2021 (quarter of March 31, 2021). While revenue declined slightly from the first quarter of 2020, net profit of $ 9.87 million was almost the same. Atrium’s mortgage portfolio is of high quality given that 82.7% are senior mortgages and the loan-to-value ratio of 92.1% is 75%.
Atrium charges higher interest rates than traditional banks or lenders. However, it wins over customers with fast processing, flexible loan offerings, and great service. Monthly dividend payments should be secure as this non-lender maintains conservative risk parameters.
Automotive Properties is a growth-oriented REIT with strong underlying fundamentals. It has a market capitalization of $ 490.28 million and owns car dealership properties. At $ 12.55 per share, the dividend offer is a hefty 6.41%. The COVID-19 pandemic took a toll on the auto industry in 2020, with sales down 20% from the previous year.
However, the improvement in the situation is reflected in the REIT’s results in Q1 2021 (quarter ended March 31, 2021). Rental income and net income increased by 4% and 67% compared to Q1 2020. He received 100% of the contractual rate base for the quarter. Likewise, the REIT received 100% of expected rents in April and May 2021.
Automotive Properties owns 66 lucrative properties that are home to popular brands such as Ford, Chrysler, Honda and Kia. Prospective investors can expect long-term income, as the weighted average lease term is around 12.4 years.
Creating an income of $ 1,000 per month takes time. Start small, then gradually increase your holdings. Since the average return is 5.81%, you should accumulate at least $ 206,500 of combined stocks to reach your goal.
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This article represents the opinion of the author, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We are straight! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer, so we post sometimes articles that may not conform to recommendations, rankings or other content. .
Foolish contributor Christopher Liew has no position on any of the stocks mentioned. The Motley Fool owns shares and recommends AUTOMOTIVE PROPERTIES REIT. The Motley Fool recommends FREEHOLD ROYALTIES LTD.