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3 Stocks That Pay You Each Month

Dan Caplinger, The Motley Fool

Most people need income that can help them cover their monthly bills. Yet most investors have to deal with dividend stocks that only make income payments on a quarterly basis, which makes budgeting a more difficult proposition.

Fortunately, a few stocks have realized the value of monthly dividend payments, giving their shareholders the income they need on the time frame in which it does them the most good. Among those stocks, you'll find LTC Properties (NYSE: LTC), San Juan Basin Royalty Trust (NYSE: SJT), and Realty Income (NYSE: O), all of which have put together solid track records of dividend performance.

Making money on long-term care

Company names often tell a story about their businesses, and LTC Properties is transparent about its ownership of long-term care facilities. LTC's portfolio as of mid-2017 included 201 properties in 28 states. The real estate investment trust typically holds properties through sale and leaseback transactions, also using mortgage financing, preferred equity, and mezzanine lending on some of its properties.

Coldspring Transitional Care Center facility under a clear sky near dusk.

Image source: LTC Properties.

LTC currently pays $0.19 per share in dividends each month, working out to a yield of 5.3%. The REIT has regularly boosted its monthly payouts over the past eight years, and with demographic trends working in its favor, LTC expects to benefit strongly from the rise in demand for senior housing, assisted living, and similar facilities catering to older Americans. That has the potential to help LTC boost its dividend even further in the years to come, giving investors even more of what they want to see.

Letting energy pay you

Royalty trusts are a great way for energy investors to get income. These special entities collect money from interests in oil and gas assets on a monthly basis and then pay it back out to their investors. San Juan Basin Royalty Trust gets its name from the assets it owns in the San Juan Basin area of northwestern New Mexico.

San Juan makes dividend payments that vary each month in line with how much its assets produce. Monthly distributions during 2017 ranged from as low as $0.038 per share to as much as $0.216 per share, with a yearly total of almost $0.84 per share amounting to a better than 10% yield based on current prices. Keep in mind, however, that some of those distributions represent depletion of the original asset, and that at the end of the day, investors will be left with an asset that has minimal residual value.

The original monthly dividend company

Realty Income prides itself on how it pays income to its shareholders, calling itself "The Monthly Dividend Company." The real estate investment trust holds more than 5,000 properties, and it boasts 81 consecutive quarterly dividend increases dating back for more than 20 years. The REIT currently yields 4.5%, and it has paid more than $5.1 billion in total dividends over nearly half a century.

Realty Income has been able to avoid some of the turmoil that has plagued other REITs that have extensive retail real estate holdings, in large part because of the selective way in which it has chosen tenants for its properties. Among its top partners, you'll find drugstores, delivery services, fitness centers, dollar stores, and movie theaters, along with wholesale clubs and convenience store chains. Unlike many brick-and-mortar retail niches, these groups should continue to see solid demand even as e-commerce trends gain momentum. That should keep income coming in for Realty Income and its shareholders for years to come.

Get income in timely fashion

It's harder than you'd think to find good stocks that pay monthly dividends. But these three fit the bill quite well, giving you the ability to match up your expenses to your income and making managing your financial life a little bit easier.

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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.