Top Monthly Dividend Stocks Include Stag Industrial, Inc.
By: Olivia Faucher,
Top monthly dividend stocks to buy during the COVID-19 pandemic include Stag Industrial, Inc. (NYSE: STAG).
Stag Industrial, Inc. is a real estate investment trust (REIT) which operates throughout the United States and focuses on the acquisition, ownership and operation of single-tenant, industrial properties. The company currently owns 450 buildings in 38 states with approximately 91.4 million rentable square feet.
Performance of Stag Industrial: One of the Top Monthly Dividend Stocks
Stag’s stock price has been on a solid upward trend for the last five years, making strides from the $19 range all the way up to the $30+ range where its price per share currently sits. The stock price took a considerable hit at the height of the financial crisis, falling 45.3% from $33.47 in February 2020 to $18.31 in March 2020. Since this large decrease, the stock has been on a consistent upward trend to reach its current perch of $33.00. The stock has made a significant recovery, as its price is close to the 52-week high of $34.09.
Stag has achieved income and revenue growth despite the economic crisis. The performance is a testament to the company’s reliability. For the second quarter of 2020, Stag produced Cash Net Operating Income of $96.6 million, an increase of 24.5% compared to $77.6 million in the second quarter of 2019. The large second-quarter increase largely can be attributed to the fact that Stag acquired nine new buildings in the first quarter of 2020, in addition to selling three buildings. This level of revenue growth is likely not sustainable, however the nine new properties will provide an increased stream of revenue. The company has year-over-year revenue growth of 21%, far surpassing the sector median of 2.73%.
Current Dividend Yield and Payout for One of the Top Monthly Dividend Stocks
Stag is currently paying out a monthly dividend of $0.12, making its annualized payout $1.44. The company’s current dividend yield is 4.43%, and average dividend yield over the last 5 years is 5.14%
Price/Earnings Ratio
Stag’s current price-to-earnings (P/E) ratio is reported at 43.71. This P/E ratio is relatively high compared to the REIT industry’s median P/E ratio of 19.73. However, investors should consider Stag’s stable track record with revenue and profit growth and consistent dividend payouts.
Comments from the Leadership of Stag Industrial: One of the Top Monthly Dividend Stocks
The CEO of Stag, Benjamin Butcher, emphasized the company’s ability to thrive during this pandemic as it pursues a plan for the future. During a July 28 earnings call, Butcher stated, “Our balance sheet, portfolio and business strategy are all well positioned to drive the Company’s future success. Recent events have caused us to reflect and made us realize that we could and should do more, more as a company and, for many of us, more as individuals. We have significantly increased our annual budget for financial support of social causes. We’re also expanding the opportunity for employees to engage in volunteer work in the community.”
Why dividendinvestor.com believes Stag Industrial is a Buy
- The company has performed well throughout the financial crisis, demonstrating that it is a resilient company with a strong business model
- Investors who buy Stag Industrial can rely on a consistent monthly dividend
Key Risks for Stag Industrial
- Damage to properties, despite insurance coverage
- Increases in interest rates
- Strong competition for tenants and prime real estate
Competitive Analysis
The chart below compares Stag Industrial (STAG) to two of its competitors, Kimco Realty Corp (KIM) and CoreSite Realty Corp (COR), in terms of various financial metrics.
| STAG | KIM | COR | |
| Current Stock Price | $33.00 | $11.11 | $126.81 |
| Market Cap | $4.92 billion | $4.80 billion | $5.39 billion |
| Beta (5Y Monthly) | 1.11 | 1.18 | 0.27 |
| P/E Ratio | 43.71 | 4.89 | 64.34 |
| EPS (TTM) | 0.75 | 2.27 | 1.97 |
| Dividend Frequency | Monthly | Do not pay a dividend | Quarterly |
| Dividend Yield | 4.43% | N/A | 3.83% |
Stag Industrial, Inc. could be a smart investment for someone who is looking to add a monthly dividend stock to his or her portfolio. To learn about other monthly dividend stock suggestions, read the following article: 6 Best Monthly Dividend Stocks to Buy Now.
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