Monthly Paid Dividend Stocks Spring Forth In April, Like Dandelions
- Imagine a stock or fund that paid out its dividends once a month! Instead of quarterly, semi-annually or (ugh) annually, your anticipatory angst waiting for money is reduced by 300%, or more.
- The April U.S. exchange-traded monthly-paid (MoPay) dividends, upsides, and net gains include: 1. Stocks by yield (76); 2. Stocks by price upside (30); 3. Closed-End Investments, Exchange-Traded Funds and Notes (CEICs/ETFs/ETNs) by yield >7.2% (80).
- 76 U.S. MoPay equities priced over $3 per share were listed here. Canadian MoPay equities are omitted, but many Canadian firms are U.S.-listed OTC. CEICs/ETFs/ETNs are combined US/Canadian. All show yields over 7.2%.
- Items: 1. Top MoPay stock gains; 2. Overall best MoPay gainers; 3. Funds vs. Equities; 4. Fund risks/rewards. All per prices as of 4/1/21.
- Analyst 1-year-targets revealed that investing $5k in the lowest priced five of ten top-yield MoPay US exchange equities produced 54.24% more gain than $5k invested in all ten. The little (lower priced) MoPay dogs rule April!
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All but nine equities and all of the funds listed in this April collection of monthly-paying dividend dogs live up to the ideal of annual dividends from $1K invested exceeding their single share price. Here in the MoPay collection lie affordable yet volatile and risky bargains. One metric ($1k Invested income >1 share price) fits all!
After the past 2020 Ides of March dip, and before other pull-backs yet to come, the time to buy top yield MoPay dogs may now be at hand.
Actionable Conclusions (1-10): Brokers Estimated Top Ten MoPay Equities Could Net 8.5% to 17.27% Gains By April 2022
Four of the ten top-yield MoPay stocks (shaded in the chart below) were verified as being among the top-ten gainers for the coming year based on analyst one-year target prices. Thus, the Dogcatcher yield-based strategy for this MoPay group, as graded by broker estimates this month, proved 40% accurate.
Estimated dividend amounts from $1000 invested in each of the ten highest-yielding stocks plus analysts median 1yr target prices for those stocks, as reported by YCharts, produced the data points. Note: target prices from lone analysts were not applied (n/a). Ten probable profit-generating trades to April 2022 were:
Solar Senior Capital (SUNS) netted $172.77 based on the median of target estimates from three analysts, plus estimated annual dividends less broker fees. The Beta number showed this estimate subject to risk/volatility 40% over the market as a whole.
Ellington Financial Inc (EFC) netted $149.42 based on the median of annual price estimates from eight analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 119% more than the market as a whole.
San Juan Basin Royalty Trust (SJT) netted $146.40, based on dividends alone less broker fees. The Beta number showed this estimate subject to risk/volatility 32% less than the market as a whole.
PennantPark Floating Rate Capital LTD (PFLT) netted $136.08 based on the median of annual price estimates from five analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 104% more than the market as a whole.
Stellus Capital Investment (SCM) netted $122.96 based on the median of annual price estimates from four analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 39% more than the market as a whole.
Orchid Island Capital Inc (ORC) netted $121.10 based on dividends alone, less broker fees. The Beta number showed this estimate subject to risk/volatility 37% over the market as a whole.
Sabine Royalty Trust (SBR) netted $118.79 based on dividends plus the median of annual price estimates from two analysts less broker fees. The Beta number showed this estimate subject to risk/volatility 20% under the market as a whole.
PennantPark Floating Rate Capital Ltd (PFLT) was forecast to net $115.45 based on a median of target price estimates from six analysts, plus estimated annual dividends less broker fees. The Beta number showed this estimate subject to risk/volatility 102% more than the market as a whole.
Gladstone Commercial Corp (GOOD) netted $113.18 based on the median of target price estimates from six analysts, plus dividends less broker fees. The Beta number showed this estimate subject to risk/volatility 1% over the market as a whole.
Telefonica Brasil SA (VIV) netted $97.69 based on dividends alone less broker fees. A Beta number was not available for VIV. VIV is also not a permanent monthly payor, YCharts (the list source) was deceived by some end of year accounting vagaries by VIV.
Average net gain in dividend and price was 12.81% on $1k invested in each of these ten MoPay stocks. This gain estimate was subject to average risk/volatility 61% more than the market as a whole.
Actionable Conclusion (11): (Bear Alert) Analysts Predicted One MoPay Equity To Show A -17.33% Loss to April 2022
The probable losing trade revealed by Y-Charts to 2022 was:
Prospect Capital Corp (PSEC) projected a loss of $173.26 based on its dividend and the median of target price estimates from two analysts including broker fees. The Beta number showed this estimate subject to risk/volatility 4% less than the market as a whole.
source: Photo by Karsten Winegeart on Unsplash
The Dividend Dogs Rule
Stocks earned the "dog" moniker by exhibiting three traits: (1) paying reliable, repeating dividends, (2) their prices fell to where (3) yield (dividend/price) grew higher than their peers. Thus, the highest yielding stocks in any collection became known as "dogs." More specifically, these are, in fact, best called "underdogs".
April Monthly Pay Dividend Data
Three lists produce numerous actionable conclusions and several more un-numbered results. To draw these conclusions and results, April 1 closing prices and estimated annual dividends were referenced from YCharts. Monthly pay (MoPay) equity (1) yield and (2) upside potential lists were compared and contrasted against (3) a high yield (and higher risk) MoPay CEICs/ETFs/ETNs list.
Monthly Pay Dividend Qualities
Quarterly, Semi-Annual and Annual dividend investors anxiously await announcements from a firm, fund, or brokerage to learn if their next dividend will be higher, lower, or paid at all.
Monthly pay stocks, funds, trusts, and partnerships inform the holder every four and one third weeks by check and/or statement. If the entity reduces or suspends a payment, the holder can sell out of the investment immediately to cut future losses.
This advantage has been curtailed when companies suddenly cut monthly dividends to save cash. Numerous prominent MoPay firms declared dividend cuts between December 2016 and May 2020. Those reducing or curtailing dividends in May and June, 2020, included: Oxford Square Capital Corp; Partners Real Estate Investment Trust; Orchid Island Capital Inc; Cross Timbers Royalty Trust; H&R Real Estate Investment Trust; BTB Real Estate Investment Trust; American Finance Trust Inc; Mesa Royalty Trust; Solar Senior Capital Ltd; Ellington Financial Inc; Dividend Select 15 Corp; Chesswood Group Ltd; Sabine Royalty Trust; TORC Oil & Gas Ltd; Freehold Royalties Ltd; ARC Resources Ltd; Inter Pipeline Ltd; San Juan Basin Royalty Trust; Ag Growth International Inc.
Former MoPay top ten regular by yield. Blue Bluerock Residential (BRG) announced December 2019 it was retreating to quarterly dividend payments "in keeping with industry tradition." That tradition continued with ARMOUR Residential REIT (ARR) and Stellus Capital Investment Corp (SCM) both transitioned to QPay in June, 2020. Now both SCM and ARR have returned to MoPay mode.
Capitala Finance Corp (CPTA) cut its monthly payout from $0.13 to $0.0833 as of October 30, 2017, then suspended it as of May 3, 2020. Oxford Square Capital, however, issued this nebulous statement regarding its pending monthly payments: "While no decision has yet been made with regard to the Company’s common stock distributions for July, August and September, we believe that the Company’s Board of Directors will likely elect to reduce or suspend the Company’s distributions for those months." On June 2, the company declared $0.035 monthly distributions for July, August and September, which have persisted.
Top yield stock for July 2018, Orchid Island Capital, released this cautionary note with its monthly dividend announcements: "The Company has not established a minimum distribution payment level and is not assured of its ability to make distributions to stockholders in the future." ORC directors proceeded to back-up their words with actions cutting the dividend from $0.14 to $0.11 in February, to $0.09 in March, to $0.08 in September 2018, and to $0.055 for May 2020. However in August. 2020 ORC monthly dividend increased from $0.06 to $0.065 for September, October, and into 2021.
The U.S. exchange MoPay segment is volatile, transitive, and recovering. More trades in monthly pay equities are available from Canadian firms, many of which are listed on U.S. OTC exchanges. Active listed MoPays priced over $3 were up from 71 in October to 73 in February 2021, and now in April 2021 at the full strength of 75 active last seen back in May/June 2020, though 76 are counted here based on a gaff by YCharts including VIV on this MOPay list.
US Exchange Traded Monthly Pay Dividend Equities by Yield
Top ten of these US exchange listed monthly pay dividend equities showing the best yields for April represented four of the eleven Morningstar market sectors, with representative firms split 1, 4, 4, and 1 between the energy, real estate, financial services, and communication services sectors.
First place went to the single energy representative, San Juan Royalty Trust . Second place belonged to the first of those four real estate equities, Orchid Island Capital . The remaining three real estate representatives placed third, seventh ninth and tenth, ARMOUR Residential REIT Inc, True North Commercial REIT ,and AGNC Investment Corp (AGNC) .
Thereafter the top ten collection was flooded by four financial services sector representatives in the fourth, sixth, seventh and eighth slots: PennantPark Floating Rate Capital Ltd ; Dividend Select 15 Corp (OTCPK:DVVDF) ; Prospect Capital Corp ; Oxford Square Capital Corp (OXSQ) . Finally, in fifth pace was the misplaced, non MoPay Communications Services entity, Telefonica Brasil SA , which completed the incoming April MoPay top ten list by yield.
Monthly Pay Dividend Equities by Price Upside
The results shown below from YCharts for MoPay dividend stocks as of market closing price April 1 were compared with the median of analyst target prices one year-out. The ten top stocks displayed 0% to 10.15% price upsides for the next year based on those analyst 1 yr. targets.
Seven (tinted) of ten on this price upside list were members of the top ten list by yield. The first five places on this upside list went to: SLR Senior Investment Corp , Ellington Financial Inc , Stellus Capital Investment , PennantPark Floating Rate Capital Ltd, and Gladstone Commercial Corp .
The lower level five (all but the first of which showed no upside) were, Sabine Royalty Trust , San Juan Basin Royalty Trust , Orchid Island Capital Inc , Telefonica Brasil SA , Dividend 15 Select Corp .
Price upside, of course, was defined as the difference between the current price and analyst target one-year median price targets for each stock.
Those six MoPay stocks showing the highest upside price potential to April 2022 were gleaned from 30 selected by yield. Three to nine analysts have historically provided the most accurate median target price estimates.
Monthly Pay Dividend Closed End Investment Companies, Exchange Traded Funds, and Notes, by Yield
Eighty top monthly dividend paying (MoPay) Closed End Funds, Exchange Traded Funds and Notes listed below were culled from nearly 800 candidates. Yields of 10.5% or greater calculated as of April 1 determined the top ten.
The top ten monthly paying dividend investment companies, funds, & notes showing the biggest yields for per YChart & YahooFinance data featured three uncollateralized debt instruments [ETNs], four closed-ended investment company [CEICs], and three open-ended investment companies [ETFs].
Three uncollateralized debt instrument companies (ETNs) placed first, second, and fourth: Credit Suisse Silver Shares Covered Call ETN (SLVO) ; Credit Suisse Gold Shares Covered Call ETN (GLDI) , and Credit Suisse X-Links Monthly Pay 2x Leveraged Mortgage REIT ETN (REML) .
Four closed end investment companies (CEICs) placed third, fifth and eighth and ninth, Oxford Lane Capital Corp (OXLC), Highland Global Allocation Fund (HGLB) , RiverNorth/DoubleLine Strategic Opportunity Fund (OPP) , and Aberdeen Income Credit Strategies Fund (ACP) .
Finally, three open ended investment companies [ETFs] placed sixth, and seventh, and tenth, InfraCap MLP ETF (AMZA) , Global X NASDAQ 100 Covered Call ETF (QYLD) , and Global X Russell 2000 Covered Call ETF (RYLD) , to complete the top ten Exchange Traded Notes, Exchange Traded Funds, and Closed End Investment Companies list for April 2021-22.
Compare Equity To Fund Performance
Note that the April 2021 top ten equity dividends are now priced 1% lower than those of the top ten funds. In February, the equities were 1% higher than the funds In January they were equal, October to December they were 1% lower, and August and September had them 1% higher. Those previous two months were the first time equities showed prices higher than funds in over a year. Equities were equal to the funds in July, 1% lower in June, 3% lower in March, April and early May. They were 2% apart in December and November 2019 but in October they were 1% less. For September 2019 equities were 2% under funds but last August they were equal. The price differences are likely found in management fees collected in the fund world and the price of risk/volatility.
Background and Actionable Conclusions
Since June 2012, readers suggested to include these funds, trusts, and partnerships. A list of MoPay equities to buy and hold in September 2012 resulted from those reader suggestions supplemented with a high yield collection from here. That list was supplemented by an upside potential article in October and a upside vs. buy & hold in November. Another list factored December 2012 reader comments.
Now we have a new decade of 2020 that began last January, and continued in February, March, April, early May, and mid May, June, July, August, September, October, November, December. The progression continued in 2021 in January, February, March and now April. We can compare and contrast MoPay equity upside potential to the yield (and higher risk/volatility) should one be tempted to buy and hold Closed End Investments or Exchange Traded Funds and Notes.
Yield Metrics Found An 54.24% Advantage To The Five Lowest Priced Of Ten High-Yield MoPay Equities
Ten monthly pay stock equities were ranked by yield. Those results, verified by YCharts and YahooFinance, produced the following charts.
Actionable Conclusions: Analysts Estimated 5 Lowest Priced of Top Ten High Yield MoPay Dividend Stocks (11) Would Produce 10.05% VS. (12) 6.52% Net Gains from All Ten by April 2022
$5000 invested as $1k in each of the five Lowest priced stocks in the top ten MoPay dividend dog kennel by yield were predicted by analyst 1 year targets to deliver 52.24% more net gain than $5,000 invested as $.5k in all ten. The very lowest-priced MoPay dividend dog, San Juan Basin Royalty Trust (SJT), was predicted to deliver the best net gain of 14.64%.
Lowest priced five MoPay dividend stocks estimated as of April 1 were: San Juan Basin Royalty Trust; Oxford Square Capital Corp; Dividend Select 15 Corp; True North Commercial REIT; Orchid Island Capital Inc, with prices ranging from $4.11 to $6.01.
Higher priced five MoPay dividend equities estimated as of April 1 were: Telefonica Brasil SA; Prospect Capital Corp; PennantPark Floating Rate Capital Ltd; ARMOUR Residential REIT Inc; AGNC Investment Corp, whose prices ranged from $7.76 to $17.02.
This distinction between five low-priced dividend dogs and the general field of ten reflects the "basic method" Michael B. O'Higgins employed for beating the Dow. The same technique, you now see, may someday be usable to find rewarding dogs in the MoPay kennel.
The added scale of projected gains based on analyst targets contributed a unique element of "market sentiment" gauging upside potential. It provided a here and now equivalent of waiting a year to find out what might happen in the market. It is also the work analysts got paid big bucks to do.
Caution is advised, however, as analysts are historically 20% to 80% accurate on the direction of change and about 0% to 20% accurate on the degree of the change.
Gains/declines, as reported, do not factor-in any tax problems resulting from dividend, profit, or return of capital distributions. Consult your tax advisor regarding the source and consequences of "dividends" from any investment.
If somehow you missed the suggestion of the stocks ripe for picking at the start of this article, here is a reprise of the list at the end:
April MoPay Equities List
(Alphabetical by Ticker)
All but nine equities and all of the funds listed in this March collection of monthly-paying dividend dogs live up to the ideal of annual dividends from $1K invested exceeding their single share price. Here in the MoPay collection lie affordable yet volatile and risky bargains. Those tickers highlighted in pink in the chart above identify the dozen non-ideal priced MoPays for April.
After the past 2020 Ides of March dip, and before other pull-backs yet to come, the time to buy top yield MoPay dogs may be now.
Stocks listed above were suggested only as decent starting points for your MoPay dividend stock purchase or sale research process. These were not recommendations.
Graphs and charts were compiled by Rydlun & Co., LLC from data derived from ycharts.com; dividend.com; Yahoo Finance; analyst mean target price by YCharts. Dog Photo: Photo by Karsten Winegeart on Unsplash
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This article was written by
Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, recommendation or endorsement to buy or sell any security. Prices and returns on equities in this article except as noted are listed without consideration of fees, commissions, taxes, penalties, or interest payable due to purchasing, holding, or selling same.
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