2025.11.05 2025.11.05
Highest Yielding Monthly Dividend Stocks

Oleg Tkachenkohttps://www.litefinance.org/blog/authors/oleg-tkachenko/

Only a limited number of stocks pay monthly dividends, primarily US REITs and BDCs. However, these companies generally show weak or inconsistent long-term growth.

Such assets may be attractive for short-term investment, although the risks should be considered. This article provides an overview of the best monthly dividend stocks suitable for any strategy.

Major Takeaways

• Monthly dividend stocks are rare. Almost all of these companies are based in the US, and most operate in specific sectors (mostly REITs and BDCs). These companies use dividend payments to optimize tax expenses.
• Certain dividend-paying companies can offer yields ranging from 14% to 18% annually, significantly exceeding the average across most industries. However, the reliability of these dividends is often uncertain. Declines in stock prices can undermine the expected returns. Therefore, it is essential to assess payback in absolute terms rather than as a mere percentage.
• Monthly dividend stocks may be suitable for short-term speculative strategies, such as trading on dividend gaps and profiting from short-term volatility. However, they are highly risky for long-term investing.
• Best stocks with positive 1-year and 5-year returns and monthly dividends are Main Street Capital Corp (MAIN) and EPR Properties (EPR).
• High-yield stocks with maximum dividend yields and monthly dividends include Eagle Point Credit Company Inc. (27.56%) and Dynex Capital Inc. (15.14%).

What Are Monthly Dividend Stocks?

Monthly dividend stocks are those that pay out every month rather than every three, six, or twelve months. These are most often real estate investment trusts (REITs) and business development companies (BDCs). Many investors find such stocks appealing for their steady dividend growth and ability to generate income every month.

Companies may have several reasons to pay dividends monthly:

• To increase attractiveness to investors. Through monthly payments, companies want to demonstrate stability, a steady cash flow, predictable profits, and the quality of their financial management.
• To optimize tax legislation. For example, in the US, REITs are required to distribute at least 90% of their taxable income as dividends. This approach allows them to avoid corporate income tax on the company’s distributable profits.
• To sustain investor interest. This policy promotes long-term ownership of monthly dividend stocks instead of short-term trading.

Important! What matters is not only the dividend yield but also the amount of dividends you receive.

• Dividend amount = net profit distributed as dividends / total number of shares * number of your shares. 
• Dividend yield = payout amount / share price * 100%.

If you receive $1 in dividends and the share price falls by half, your dividend yield doubles, but your actual dividend income remains unchanged at $1.

The dividend yield percentage alone does not play a decisive role, since it depends on the share price. To assess the real appeal of a share, investors should look at the total dividends received over five years, together with the change in the share price. A financial advisor can help interpret these metrics and assess dividend safety.

For example:

• ARMOUR Residential REIT (ARR) dividend shares have decreased by $31.23 over the past five years.
• The company paid monthly dividends of $0.10 per share from 2020 to 2022, and $0.24 per share from 2023 onwards (figures rounded up). Over five years, a shareholder received $0.1*12 *2 + $0.24*12*3 = $11.04.

As a result, the shareholder failed to recover the invested capital.

The formula for calculating profit or loss in percentage terms:

(P2 – P1 + D) / P1 * 100%, where

P2 – current price, P1 – price five years ago, D – dividend amount.

Benefits of High-Yield Monthly Dividend Stocks

Advantages of dividend stocks that pay monthly:

• Regular cash flow provides a steady source of passive income and reinvestment opportunities, which is ideal for retirees.
• High dividend yield. While an average annual return across most industries is 2–4%, some monthly dividend-paying companies can exceed 14–15% per annum.
• Reduced market risk. You can mitigate volatility by receiving monthly income regardless of stock price movements. Besides, monthly income can help cushion the impact when the market falls. However, this advantage applies to stocks with low volatility that are stable in the long term.
• Compound interest effect. Monthly reinvestment increases returns compared to quarterly payments. You reinvest the dividend income you receive every month rather than every quarter, which results in a higher annual dividend yield.
• Psychological comfort. You track your financial results every month.

A passive income strategy focuses on investing in high-yield stocks that provide monthly dividends of 14–15% annually. Over five years, even a 10–15% drop in stock prices can still result in satisfactory returns. The shares may recover. However, a slump of more than 20% during this period raises serious concerns about the investment’s viability.

Moreover, significant risks remain. For monthly dividend stocks, this often translates into additional accounting and transaction costs. Some issuers may adopt this approach primarily to attract new shareholders. However, when dividend yields are high and payments are frequent, it can be a sign that the business itself lacks stability.

Highest Yielding Monthly Dividend Stocks Now

Only a few companies pay dividends every month. The majority are listed on major exchanges such as the NYSE and belong to income-focused sectors like real estate, utilities, and financial services. In other cases, dividends are distributed quarterly, semiannually, or annually. Therefore, when creating this list, it was challenging to find companies that offered both high dividend yields and consistent growth over one- and five-year periods.

The list of high-yield monthly dividend stocks was compiled based on the following criteria:

• Maximum dividends with sustainable monthly payouts for at least 5 years.
• Monthly dividend payouts and positive 1-year or 5-year return, which indicates potential for further growth.
• The company’s market capitalization exceeds $1 billion.

The list ranks monthly dividend-paying stocks by dividend yield, so companies with smaller but more stable growth appear lower down.

Many high-yield dividend stocks in the REIT sector have fallen sharply in recent years due to rising interest rates. These companies often carry heavy debt and face increasing expenses. Still, some have managed to remain resilient. The list of top performers (not just those with the highest dividend yields, which failed to offset share declines over one- and five-year periods) mainly includes companies from the REIT and BDC sectors.

Monthly dividend stocks list:

Eagle Point Credit Company (ECC)

Capitalization: $0.788 billion.

5-Year Return: -22.0%, 1-Year Return: -34.86% (as of 26.10.2025).

Monthly dividend yield: 2.27% or $0.14 per share.

Eagle Point Credit is a BDC specializing in investments in collateralized loan obligations (CLOs), which are securities that bundle a pool of lower-rated corporate loans.

This stock is an appealing choice for investors ready to take on risk. Its share price has dropped 34% over the past year. However, over five years, the decline is only 22%. During that time, monthly dividends have ranged from $0.12 to $0.16 per share, yielding around 10–20% annually. In other words, dividends over five years could have offset the one-third drop in the stock’s price.

Moreover, the company’s shares soared from $6 to $15 in 2020. Thus, the current share price is likely at its lowest and may start to rise.

Dynex Capital Inc (DX)

Capitalization: $1.96 billion.

5-Year Return: -17.83%, 1-Year Return: +8.70% (as of 26.10.2025).

Monthly dividend yield: 1.26% or $0.17 per share.

Dynex Capital is a mortgage real estate investment trust (mREIT) that invests in mortgage loans or mortgage-backed securities. The company’s primary objective is to generate profits from the difference between the interest income on its mortgage assets and the cost of financing them.

The company’s shares may attract medium-term investors. Although the stock has faced periods of sharp drops, its performance over the past year has been positive, making it a potential candidate for a bottom-fishing strategy. Dividend payments have remained relatively stable and have gradually increased, though there was a short period in 2019 when payouts were almost halted. Over the past three years, the dividend yield has consistently stayed above 12%.

If you are concerned about missing dividend payments, consider purchasing cumulative preferred shares traded under the ticker DXPRC.

AGNC Investment Corp (AGNC)

Capitalization: $10.94 billion.

5-Year Return: -26.99%, 1-Year Return:+5.81% (as of 26.10.2025).

Monthly dividend yield: 1.17% or $0.12 per share.

AGNC Investment is an mREIT founded in 2008. The company invests primarily in Agency residential mortgage-backed securities (RMBS) issued or guaranteed by US government-sponsored enterprises such as Fannie Mae, Freddie Mac, and Ginnie Mae. 

Despite maintaining regular monthly payouts, the dividend amount has gradually declined. In April 2019, it was cut from $0.18 to $0.16 per share, and in March 2020, it dropped further to $0.12. Due to share price fluctuations, the dividend yield has ranged from 7.75% to 20.57%.

Capital Southwest Corp (CSWC)

Capitalization: $1.16 billion.

5-Year Return: +57.30%, 1-Year Return: -18.78% (as of 26.10.2025).

Monthly dividend yield: 1.01% or $0.19 per share.

Capital Southwest is a BDC that focuses on financing mid-market businesses through lending, direct investments, and venture capital.

Although the company’s shares declined over the past year, they have demonstrated positive long-term returns. The company paid quarterly dividends until June 2025, when it switched to a monthly payment schedule. The monthly payment is unstable, ranging from $0.19 to $0.25 per share.

Ellington Financial Inc (EFC)

Capitalization: $5.59 billion.

5-Year Return: +8.82%, 1-Year Return: +6.47% (as of 26.10.2025).

Monthly dividend yield: 0.98% or $0.13 per share.

Ellington Financial invests in diversified mortgage and credit assets, including bonds backed by residential and commercial loans.

Despite the company’s modest stock returns, dividend payouts helped compensate for it. The payouts are regular, though the amounts have varied over the past five years, fluctuating between $0.09 and $0.15 per share per month. The dividend yield has ranged from 9% to 15%.

EPR Properties (EPR)

Capitalization: $4.09 billion.

5-Year Return: +125.63%, 1-Year Return: +14.33% (as of 26.10.2025).

Monthly dividend yield: 0.55% or $0.30 per share.

EPR Properties is a net-lease REIT specializing in experiential properties across the US and Canada, including movie theatres, amusement parks, ski resorts, gaming, and education facilities. The company owns a portfolio of over 350 locations leased under long-term agreements, in which tenants often bear the costs of maintenance, insurance, and taxes.

The company’s weakest year in recent history was 2020, when it had to cut its monthly dividend from $0.38 to $0.25 per share and suspend payments for 15 months. Since then, dividends have grown steadily. Over the past five years, the dividend yield has reached as high as 18%, averaging between 6.5% and 8%.

LTC Properties Inc (LTC)

Capitalization: $1.64 billion.

5-Year Return: +7.60%, 1-Year Return: -1.17% (as of 26.10.2025).

Monthly dividend yield: 0.54% or $0.19 per share.

LTC Properties shares are highly volatile, with prices still recovering from the market downturn. The stock is unlikely to suit long-term investors (5+ years), but it may offer short- and medium-term opportunities. Dividends are modest yet above the industry average, and the payout amount has remained unchanged since 2016. Payments are stable.

Realty Income (O)

Capitalization: $5.59 billion.

5-Year Return: +7.07%, 1-Year Return: -2.12% (as of 26.10.2025).

Monthly dividend yield: 0.50% or $0.26 per share.

Realty Income is a REIT that acquires and manages commercial real estate properties under long-term leases. The company’s investment portfolio comprises more than 15,600 properties in the US, the UK, and seven European countries.

Realty Income is one of the largest companies by market capitalization, known for its high-yield stock and reliable monthly dividends. The company is committed to maintaining a steady payout schedule, with only a few brief interruptions over the years. The longest gap lasted from June 2022 to March 2023. Its dividend amount has risen from $0.23 in 2021 to $0.26 today, while the dividend yield is 5–6% per annum.

Main Street Capital Corp (MAIN)

Capitalization: $5.14 billion.

5-Year Return: +109.75%, 1-Year Return: +10.42% (as of 26.10.2025).

Monthly dividend yield: 0.44% or $0.26 per share.

Main Street Capital is a BDC that provides long-term debt and equity capital solutions to lower-middle-market companies. Its support spans recapitalizations, management buyouts, growth financings, refinancings, and acquisitions. 

In recent years, the company has steadily paid monthly dividends, albeit with some fluctuations in the amounts. Over the past three years, dividends have typically ranged from $0.22 to $0.26 per share, with occasional deviations between $0.10 and $0.30 in certain months. Notably, the stock has consistently provided a yield exceeding 6%.

STAG Industrial (STAG)

Capitalization: $7.21 billion.

5-Year Return: +23.97%, 1-Year Return: +2.93% (as of 26.10.2025).

Monthly dividend yield: 0.32% or $0.12 per share.

STAG Industrial is a REIT dedicated to acquiring, owning, and operating industrial properties in the US. The company’s property includes various industrial buildings such as warehouses, distribution centers, and manufacturing facilities that are leased out.

Since 2015, STAG has consistently paid the same amount of $0.12. The relatively small dividend amount is balanced out by positive 1-year and 5-year returns, a performance that many of its sector peers lack.

How to Build a Monthly Dividend Portfolio

Algorithm for investing in monthly dividend-paying stocks:

1. Each month, look for promising dividend stocks by running a targeted search online or asking an AI tool to generate a list of candidates or relevant sources. Many financial websites also offer screeners that let you filter stocks by specific criteria. The main drawback is that most of these tools focus on regional markets, primarily the US.

2. Assess companies offering high-yield dividend stocks based on the following criteria:

• Annual return and dividend stability for at least the last five years.
• Sustainable 1-year and 5-year returns, as steady growth ensures that dividends complement a rising share price.
• Market capitalization of around $1 billion or more (or the equivalent in other currencies), as larger companies generally inspire greater investor confidence.
• A payout ratio, or the share of profits paid as dividends, is 30–80%. A ratio above 100% suggests that dividends are funded from external sources rather than earnings, which may signal poor financial discipline or temporary inefficiency. If such a situation continues, dividend payments could become unstable.

3. Choose a broker carefully. CFD brokers typically offer only a limited selection of dividend stocks. Therefore, it is better to work with a broker that provides investors with direct access to real stock exchanges. However, this often comes with higher entry requirements and transaction fees for all participants.

You determine the structure of your investment portfolio and the investment horizon based on your individual circumstances, adjusting positions as needed and deciding when to sell a portion of your holdings to rebalance. The optimal portfolio consists of 20–30 stocks, including the world’s largest companies by market capitalization and industry leaders.

ETFs that pay dividends monthly can be a good alternative to individual dividend stocks. These funds invest in a range of companies, and many use the covered call options strategy to generate the cash needed for regular payouts. Examples include the JPMorgan Equity Premium Income ETF (JEPI) and the Global X Nasdaq 100 Covered Call ETF (QYLD). Another strategy is to invest directly in blue-chip stocks.

Conclusion

For long-term investors, focusing too much on monthly dividend payers rarely pays off. While past performance may seem attractive, it does not necessarily indicate strong future results. There are relatively few companies in this category, and most experience share price declines of over 20% within five years. With average yields of 5–8% annually, these kinds of investments can look less appealing in the long run.

For short-term investors, one possible strategy is to buy stocks with the highest dividend yields before the record date, the final day you must own shares to be listed as a shareholder and receive the next dividend payment.

In addition to the record date, you should pay attention to the ex-dividend date. This is the first day when shares are traded without the right to receive the upcoming dividends. Investors who bought securities on this day or later will not receive dividends. The seller who owned the shares before this date retains the right to payment.

Most financial portals provide dividend calendars.

There are very few companies in Europe that pay monthly dividends. In the US, such stocks are mostly high-risk funds with poor long-term performance. Their only upside may come if the Fed cuts interest rates, but even then, the risks remain high.