Spring Sale
Most TSX stocks that share a portion of corporate earnings with shareholders distribute quarterly dividends. However, a select few pay monthly dividends. Some investors prefer this payout frequency because, besides the convenience of regular cash flows, dividends compound more quickly when reinvested 12 times a year instead of four.
If you need passive income every month, Whitecap Resources (TSX:WCP) and Crombie (TSX:CRR.UN) offer attractive dividends. The yields are 5.73% and 5.78%, respectively. Buying 1,010 shares of each for a combined investment of $26,047.90 will generate $125.04 in monthly passive income at their current share prices and yields.
The table below shows the breakdown:
| Company | Price | No. of Shares | Dividend per Share | Total Payout | Frequency |
| Whitecap | $10.19 | 1,010 | $0.58 | $589.73 | Monthly |
| Crombie | $15.60 | 1,010 | $0.90 | $910.70 | Monthly |
Growth and cash-generation engines
Whitecap Resources owns or has interests in petroleum and natural gas properties. This $6.2 billion oil & gas company’s low-decline light oil asset base supports an internally funded business model. Furthermore, the assets boast stable production and provide shareholders with predictable cash flows for monthly cash dividends.
Management believes the oil-weighted growth company has a balance between growth engines and cash generation engines. Its light oil resource base is the solid foundation for continued growth and results on a per-share basis. Whitecap’s core areas are in northern and southern Alberta and Saskatchewan.
Whitecap’s performance in 2022 was exceptional, despite the net income sliding 5.7% year over year to $1.67 billion. Total revenue (petroleum and natural gas) and funds flow soared 76.3% and 111.4% to $4.45 billion and $2.32 billion versus 2021. The reward to investors was $237.2 million in total dividends — an 88.1% increase from a year ago.
For 2023, Whitecap expects a capital expenditure of $900 to $950 million to produce 160,000 to 162,000 barrels of oil equivalent per day (boe/d), representing a 13% production per share growth. You’d be investing in a growth stock owing to the 765.15% overall return in three years.
Resilient and growing portfolio
Crombie is a prominent owner, operator, and developer of quality real estate. Canadian conglomerate Empire Company and parent company of Sobeys has a 41.5% ownership stake in this $2.78 billion real estate investment trust (REIT).
Management believes the REIT’s high-quality, sustainable property portfolio (301 properties) underpins the growth platform. The mix of grocery-anchored (88%), industrial, and multi-residential properties drives strong, predictable cash flow growth. Also, there are 27 mixed-use development pipeline projects.
Besides a resilient and growing portfolio, Crombie’s sustainable competitive advantage is its strategic partnership with Empire. Last year, property revenue and operating income attributable to unitholders increased 2.6% and 8% to $419.6 million and $167.8 million versus 2021. The 96.9% committed occupancy in the fourth quarter was a new record.
As of year-end 2022, the weighted average lease term is nine years. Crombie’s fundamentals remain solid because of the stable needs-based retail real estate. Moreover, the robust pipeline, including non-major developments, adds significant growth potential.
Power of compounding
Since Whitecap and Crombie provide steadier income streams through monthly dividends, investors incorporate them into their monthly budgets. And because there is frequent compounding, the returns should be better over time.
