This 8.4% Dividend Stock Pays You Every Month!

Artis Real Estate Investment Trust (TSX:AX.UN) is a dividend stock that pays out a chunky monthly distribution in May 2023.

Ambrose O'Callaghan ❯

Ambrose O'Callaghan graduated with a BA in Political Science from McMaster University. After that, he jumped into the banking world. He worked from the front line to an investment associate role. After that, he found a way to marry his experience and knowledge in the world of banking and finance to his love and passion for writing. Ambrose is a passionate believer in Warren Buffett's value investing model.

Published May 18, 2023 12:15 pm EDT

Artis Real Estate Investment Trust (TSX:AX.UN) is a Winnipeg-based real estate investment trust (REIT) that possesses a portfolio of industrial, office, and retail properties in Canada and the United States. Today, I want to discuss why this monthly dividend stock is worth holding for Canadians who are hungry for big income right now. Let’s jump in.

Why this dividend stock is worth your attention for the rest of 2023

A real estate investment trust (REIT) is a company that owns and often operates income-producing real estate. These investment vehicles have been a consistent source of dividend income for Canadians over the past decade. Naturally, REITs have been bolstered by a red-hot Canadian housing market. The market has encountered turbulence due to rising interest rates, but experts do not expect REITs to feel the worst effects of this policy change until 2025.

Shares of Artis REIT have dropped 4.7% month over month as of close on Tuesday, May 16. This dividend stock has plunged 22% so far in 2023. Foolish readers who want to see more can play with the interactive price chart below.

Here’s why Canadians should pursue passive income right now

The S&P/TSX Composite Index plunged 297 points on Tuesday, May 16. Some of the worst-performing sectors included base metals, energy, and battery metals. The Canadian market has hit a rough patch since the second half of April. In this environment, investors might want to target stocks that provide big passive income.

This dividend stock released its first-quarter (Q1) fiscal 2023 earnings on May 11. It posted total revenues of $90.2 million — down from $93.2 million in the first quarter of fiscal 2022. Moreover, it reported a net loss of $22.7 million compared to net earnings of $237 million in the prior year. However, Artis delivered adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $66.3 million, which was up from $60.6 million in Q1 of fiscal 2022.

Management praised the company’s performance in Q1. Artis REIT delivered same-property net operating income (NOI) of 8.4%, demonstrating the strength of its real estate portfolio. Meanwhile, occupancy remained above 90% in the face of a challenging macroeconomic environment.

How you can generate big, monthly passive income with this dividend stock

Artis REIT is still trading in solid value territory compared to its industry peers, which makes it a good target. On May 15, Artis REIT announced a monthly distribution of $0.05 per share. That represents a very tasty 8.4% yield.

COMPANY	RECENT PRICE	NUMBER OF SHARES	DIVIDEND	TOTAL PAYOUT	FREQUENCY
AX.UN	$7.10	915	$0.05	$45.75	Monthly

The dividend stock was trading at $7.10 in late-morning trading on May 17. Investors should look to stash this REIT in a Tax-Free Savings Account (TFSA) to churn out tax-free passive income. The annual contribution for a TFSA jumped to $6,500 in 2023. We can snatch up 915 shares of Artis REIT for a purchase price of $6,496.50 at the time of this writing. This investment will allow us to generate tax-free, monthly passive income of $45.75 going forward. That works out to annual passive income of $549.