USOI - January's 83 Monthly Paid Dividend Stocks And 80 Funds

2024-01-14 09:11:19 ET

Summary

• Imagine stocks or funds that pay-out their dividends once-a-month! Unlike waiting for quarterly, semi-annual or (ugh) annual payouts, your angst awaiting money is reduced by 300%, or more!.
• These January U.S. exchange-traded monthly-paid (MoPay) dividends, upsides, and net-gains include: 1. Stocks by-yield (83); 2. Stocks by price-upside (30); 3. Closed-End-Investments, Exchange-Traded-Funds & Notes (CEICs/ETFs/ETNs) by-yield >10.4% (80).
• Items: 1. Top MoPay stock gains; 2. Overall best MoPay gainers; 3. Funds vs. Equities; 4. Fund risks/rewards. All per prices as of 1/11/24.
• 83 U.S. MoPay equities priced over $5.00 per share and yielding 10% to 27.33% are listed here. Canadian MoPay equities are omitted but many Canadian firms are U.S. listed OTC. 80 funds (CEICs/ETFs/ETNs) are combined US/Canadian, and all 80 funds show yields over 10.48%.
• Analyst 1-year-targets revealed that investing $5k in the lowest priced five of ten top-yield MoPay US exchange equities could produce 30.22% LESS gain than $5k invested in all ten. Big (higher priced) MoPay dogs held the lead by over three lengths in January.

Foreword

All but three equities and all of the funds listed in this January monthly pay batch live up to the ideal of paying annual dividends from a $1K investment exceeding their single share price. Here, in the MoPay collection, lie affordable (yet volatile and risky) bargains. The dogcatcher rule of thumb is: one metric ($1k invested dividend income > 1 share price) fits all!

Now, over three and three-quarter years past the 2020 Ides of March market dip, and before other pull-backs yet to come, the time to buy top yield MoPay dogs may be now.

Actionable Conclusions (1-10): Brokers Estimated Top Ten MoPay Equities Could Net 17.58% to 117.45% Gains By January 2025

Eight of 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 80% accurate.

Estimated dividend payouts 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 gains estimates below. (Note: target prices from lone analysts were not counted.) Ten probable profit-generating trades to January, 2025 were:

Orchid Island Capital Inc. ( ORC ) netted $1,174.55 based on the median of target price estimates from 2 analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 82% greater than the market as a whole.

Ellington Financial Inc. ( EFC ) netted $279.30 based on the median of target price estimates from 7 analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 93% greater than the market as a whole.

True North Commercial REIT ( OTC:TUERF ) netted $224.70 based on dividends, less broker fees. A Beta number was not available for TUERF.

2020 Bulkers Ltd. ( OTCPK:TTBKF ) netted $222.90 based on Dividends less broker fees. A Beta number was not available for TTBKF.

Ellington Residential Mortgage REIT ( EARN ) was forecast to net $208.99 based on the median of target price estimates from 2 analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 87% greater than the market as a whole.

Stellus Capital Investment Corp. ( SCM ) netted $196.78, based on the median of target price estimates from 6 analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 20% greater than the market as a whole.

Dynex Capital Inc. ( DX ) netted $194.39 based on the median of target price estimates from 3 analysts, plus dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 33% greater than the market as a whole.

San Juan Basin Royalty Trust ( SJT ) netted $191.10 based on estimated annual dividends less broker fees. The Beta number showed this estimate subject to risk/volatility 26% under the market as a whole.

Financial 15 Split Corp. ( OTCPK:FNNCF ) netted $189.40 based only on dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 10% greater than the market as a whole.

Canadian Banc Corp. ( OTCPK:CNDCF ) netted $175.80 based on based on dividends, less broker fees. The Beta number showed this estimate subject to risk/volatility 32% less than the market as a whole.

Average net gain in dividend and price was 30.58% on $1k invested in each of these ten MoPay stocks. This gain estimate was subject to average risk/volatility 7% greater than the market as a whole.

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".

January's Monthly Pay Dividend Data

Three lists produce numerous actionable conclusions and several more un-numbered results. To draw these conclusions and results, January 11, 2023 closing prices and estimated annual dividends were referenced from YCharts. In the process, monthly pay equity (1) yield and (2) upside potential lists were compared and contrasted against (3) the 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 May and June, 2020, including: 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. Bluerock Residential announced December 2019 it was retreating to quarterly dividend payments "in keeping with industry tradition." Bluerock Residential company has since gone private and is no longer listed publicly.

That "industry tradition" continued with Armour Residential REIT and Stellus Capital Investment Corp both transitioned to QPay in June, 2020. Within three months, however, both SCM and ARR returned to MoPay mode.

Top yield stock for July, 2018, June 2021, and December 2023, Orchid Island Capital, released this cautionary note with its monthly dividend announcements back in 2018: "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. ORC currently pays a $0.12 monthly dividend (recently falling from $0.16) and is again listed here.

The U.S. exchange MoPay segment is volatile, transitive, recovering, and for 2024 has achieved recovery to full strength. More trades in monthly pay equities are available from Canadian firms, many of which are also listed on U.S. OTC (pink sheet) exchanges. Active listed MoPays priced over $2 were up from 71 in October to 73 in February 2021, and since October 2021 at the full strength of over 100 active, not seen for years. This list found itself pared to 83 by keeping the share price limit at $5 and not listing dividends yielding under 3.68%.

List One:

US Exchange Traded MoPay Dividend Equities by Yield

Top ten of these US exchange listed monthly pay dividend equities showing the best yields for January, represented just four of the eleven Morningstar market sectors. Representative firms split 6, 1, 1, and 2, between the real estate, industrial, energy, and financial services sectors.

First place, by yield, belonged to the lone energy sector representative, San Juan Basin Royalty Trust [1].

First place, by yield, belonged to the first of six from the real estate sector, True North Commercial REIT [1]. The other five real estate representatives placed sixth through tenth, Orchid Island Capital [6]; Ellington Residential Mortgage REIT [7]; ARMOUR Residential REIT ( ARR ) [8]; AGNC Investment Corp ( AGNC ) [9]; Ellington Financial Inc [10].

Second place was claimed by the industrials representative, 2020 Bulkers Etc [2]. Then Third place went to an energy sector member, San Juan Royalty Trusts [3].

Finally, fourth and fifth places went to two financial services sector members, Financial 15 Split Corp [4], and Canadian Banc Corp [5], which completed the January MoPay top-ten equities list by yield.

List Two:

Monthly Pay Dividend Equities by Price Upsides (and Downsides)

Results from YCharts, shown below, show 30 MoPay dividend stocks (as of market closing price January 11) compared with the median of analyst target prices one year-out. The ten top-stocks displayed 0% to 101.85% price upsides for the next year.

Six (tinted) of ten on this top ten price upside list were also members of the top ten list by yield. The first five places on this upside list went to: Orchid Island Capital Inc [1], Ellington Financial Inc [2], Stellus Capital Investment Corp [3], Dynex Capital Inc [4], and Ellington Residential Corp [5].

The lower level (by yield) five were, Gladstone Capital Corp [6], Peyto Exploration & Development [7], True North Commercial REIT [8], Pennant Park Floating Rate Capital Ltd [8], 2020 Bulkers Ltd [9], and San Juan Basin Royalty Trust [10].

Price upside, of course, was defined as the difference between the current price and analyst target one-year median price targets for each stock.

Ten MoPay stocks showing the top estimated price gains for January, 2025 were gleaned from 30 selected by yield. Three to nine analysts have historically provided the most accurate median target price estimates.

List Three:

MoPay Dividend Closed End Investment Companies, Exchange Traded Funds, and Notes, by Yield

Eighty top monthly dividend paying Closed End Funds, Exchange Traded Funds and Notes listed below were culled from nearly 800 candidates. Yields of 17.07% or greater, calculated as of January 11, determined the top ten. All 80 show assets under management [AUM] greater than $30M and are priced above $6.28 per share.

The top-ten monthly-paying dividend investment companies, funds, & notes. showing the biggest yields for per YChart & Yahoo Finance data, featured seven open-ended investment companies [ETFs], two uncollateralized debt instruments [ETNs], and one closed-ended investment company [CEIC].

The seven open ended investment companies [ETFs] placed first, third through seventh, and ninth: Simplify Bitcoin Strategy PLUS Inc ETF (MAXI) [1] YieldMax NVDA Option Income Strategy ETF ( NVDY ) [3], Defiance Nasdaq 100 Enhanced Options Inc ( QQQY ) [4]; iShares 20+ Year Treasury Bond BuyWrite Strategy ETF ( TLTW ) [5]; YieldMax SQ Option Income Strategy ETF ( SQY ) [6], iShares Investment Grade Corp Bond BuyWrite Strategy ETF ( LQDW ) [7], and YieldMax AAPL Option Income Strategy ETF (APLY) [9].

Then two uncollateralized debt instruments (ETNs) placed second and tenth, Credit Suisse X-Links Crude Oil Shares Covered Call ETN ( USOI ) [2], and Credit Suisse X-Links Silver Covered Call ETN ( SLVO ) [10].

Finally, one closed end investment company (CEICs) placed eighth: Eagle Point Credit Co Inc. ( ECC ) [8], to complete the top-ten Exchange Traded Notes, Exchange Traded Funds, and Closed End Investment Companies list for January, 2024-25.

Compare Equity To Fund Performance

Note that January 2024-25 top-ten equity dividends are currently priced 8% under those of the top ten funds. Last September they were 2% higher. Last June they were 1% higher. The price differences were found in the outlandishly high dividends attributed to the top equities or funds. Again this month the author lopped the three top funds paying 29% to 45% yields off the Funds list. Without those odd aberrations, funds are generally priced higher than the equities due to the higher overhead costs of fund management.

Background and Actionable Conclusions

In June 2012 readers suggested the author include these funds, trusts, and partnerships in the MoPay article. 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.

A new decade of 2020 that began in January , and continued to February , March , April , early May , and mid May , June , July , August , September , October , November , December . The progression continued in 2021 in January , February , March , April , May , June , July , August , September , October , November , and December . And carried-on in 2022, January , February , March , April , May , June/July , August , September , October , November , December , and again, in 2023, January , February , March , April . May , June , July , August , September , October , and December .

Now in January, 2024 we continue to compare and contrast MoPay equity upside potential to the yield (and higher risk/volatility) should any investor be tempted to buy and hold Closed End Investments or Exchange Traded Funds and Notes.

Yield Metrics Showed A 30.22% Disadvantage For The Five Lowest-Priced Of Ten High-Yield MoPay Equities In January

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 19.8% VS. (12) 28.38% Net Gains from All Ten by January, 2025

$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 30.22% LESS net gain than $5,000 invested as $.5k in all ten. The sixth lowest-priced MoPay dividend dog, Orchid Island Capital Inc, was predicted to deliver the best net gain of 117.46%.

Lowest priced five MoPay dividend stocks estimated as of January 11 were: True North Commercial REIT; San Juan Basin Royalty Trust; Financial 15 Split Corp; Ellington Residential Mortgage REIT; Canadian Bank Corp; with prices ranging from $5.31 to $7.46.

Higher priced five MoPay dividend equities, estimated as of October 11, were: Orchid Island Capital Inc; AGNC Investment Corp; 2020 Bulkers Ltd; Ellington Financial Inc; ARMOUR Residential REIT Inc, whose prices ranged from $8.67 to $11.36.

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, is today useful to find long-term 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 15% to 85% accurate on the direction of change and about 0% to 15% 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.

Afterword

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:

January MoPay Equities List

(Alphabetical by Ticker Symbol)

All but three equities and all of the funds listed in this October 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.

January Ideal MoPay Equities List

(Dividend from $1K Invested > Share Price)

Now, over three and three-quarter years beyond the 2020 Ides of March dip, and before more pull-backs yet to come, the time to buy top yield MoPay dogs may now be at hand. There have been more to choose from. This month's list of 79 showed a maximum yield top 19.96% , setting the minimum price per share for selection at $5, and holding the minimum yields to 3%. When bears are back, bargains reappear.

January's list of 83 showed 80 ideal candidates whose dividends from $1K invested exceeded the single share price.

Stocks listed above were suggested only as decent starting points for your MoPay dividend stock purchase or sale research process. These were not recommendations.

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.

Graphs and charts were compiled by Rydlun & Co., LLC from data derived from www.ycharts.com; www.dividend.com; finance.yahoo.com; analyst mean target price by YCharts. Open source dog art from dividenddogcatcher.com.

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