Published on 24 Feb 2024 on Insider Monkey via Yahoo Finance
11 Best Stocks That Pay Monthly Dividends in 2024
In this article, we discuss 11 best stocks that pay monthly dividends in 2024. You can skip our detailed analysis of dividend stocks and their performance over the years, and go directly to read 5 Best Stocks That Pay Monthly Dividends in 2024.
Dividend income has risen from 2.85% in 1981 to 5.89% in 2014, while interest income has decreased from 13.5% to 8.6% during the same timeframe, as reported by S&P Dow Jones Indices. In addition to this, looking back to 1960, 69% of the overall return of the S&P 500 Index can be credited to the reinvestment of dividends and the compounded growth they generate over time.
There has been a new angle on dividend investing cropping up lately. Traditionally, investors leaned towards companies offering hefty dividends, assuming they were more dependable. However, recent studies suggest that companies maintaining a balance with sustainable dividends, without excessively high payouts, have actually yielded superior returns over the long term. A research conducted by Wellington Management split dividend-paying companies into five groups and then sorted them based on their payout levels from highest to lowest. Surprisingly, the companies that performed better than the S&P 500 Index fell into the second-highest quintile rather than the highest. This unexpected outcome suggests that some companies may have been overdoing it with their dividend payouts, leaving themselves with less capital for future growth. Meanwhile, companies with more moderate payouts were able to reinvest their earnings and maintain enough flexibility to continue offering steady dividends in the long run.