Gladstone Land - >>> 2 Stocks That Cut You a Check Each Month
These two very successful niche operators have been handing out monthly dividends for many years running.
Motley Fool
by Eric Volkman
Dec 17, 2021
In this current era, where change often moves with lightning speed, who wants to wait three months to receive a dividend? Is it because the decades-old standard quarterly dividend is still very much the norm? Why can't it be the exception?
Well for a select group of dividend-paying companies, distributing a chunk of profits in the form of a regular monthly dividend is the norm. Let's take a closer look at two of them -- Realty Income (NYSE:O) and Gladstone Land (NASDAQ:LAND) -- and see if getting paid each month by these dividend stocks is right for you.
Gladstone Land
Elsewhere in the REIT sector, we have Gladstone Land. This company's focus is on farmland and assets related to the same, i.e., properties that are rented under triple-net leases to their tenants. Gladstone owned 160 farms covering more than 108,000 acres across 14 U.S. states as of November. All of its properties are under lease.
Are you saying you've never heard of an agricultural properties REIT? That's not surprising. There are only very few on the market and of that small group, Gladstone is far and away the largest and most significant.
Gladstone tends to favor farms that grow fresh produce and select "permanent" crops like nuts and blueberries. It believes these are more profitable and can thus produce higher rental income. These crops also tend to require lower storage expenses and are less volatile in price than commodity crops such as wheat and corn.
This focus makes for a good business strategy. Thanks to organic growth (no pun intended) and net additions to its property portfolio (33, to be exact), Gladstone posted a robust 40% year-over-year increase in revenue in its Q3 (to just under $19.6 million). AFFO saw an even higher leap, bounding 66% upwards to nearly $5.3 million.
That's entirely in character for Gladstone, which over the past few years has seen dramatic improvements in both revenue and AFFO.
All this means Gladstone has plenty in its financial tank for a dividend that gets distributed 12 times per year. The dividend has been paid without fail since the company listed on the stock market in 2013.
The payout isn't immense in either absolute terms (the latest one was less than $0.05 per share) or yield, which these days is 1.8%. However, the regularity of this reliable monthly dividend, Gladstone's strong position in its very limited niche, and its vast scope for expansion make it a compelling stock worth considering. After all, this is a huge country that still has plenty of agricultural lands available to develop.
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