Top 5 Dividend Stocks You Must Buy in 2023

Monthly dividend stocks are helpful for investors looking for a stable and long-term source of income. During bear markets, when stock prices are falling, some investors opt to invest in monthly dividend stocks.

Whatever your risk taste, the monthly payments provided by dividend stocks can help you plan your finances more easily, especially if you rely on your portfolio for income. They can also help to alleviate your concerns about a struggling market because you will receive consistent dividends each month.

Dividend Stocks have stable earnings and a track record of distributing a portion of them.
Dividend companies have stable earnings and a track record of distributing a portion of them. (Photo: Investopedia)

Here Are the Top 5 Dividend Stocks to Buy in 2023

1. The Main Street Capital Corp.
Main Street Capital Corp. (MAIN) is a private equity firm that invests in companies with revenues ranging from $10 million to $150 million. The company has been in operation since the mid-1990s. Over time, it has assisted over 200 private companies in growing. It prioritizes companies with strong competitive advantages, consistent and positive cash flow, and seasoned management teams with proven track records.

Pros: Successful track record, consistent earnings growth
Cons: Recently, some dividends have been lower than usual.
$3.10 billion in market capitalization
6.76% dividend yield

2. SL Green Real Estate Corp.
According to the company’s website, SL Green (SLG) is a REIT that invests in office buildings and shopping centers in New York City and is Manhattan’s largest office landlord. As of December 31, 2022, the company owned 61 buildings totaling 33.1 million square feet. SL Green was founded in 1997 and is based in New York City.

Advantages: Strong real estate portfolio in a desirable market; high dividend yield
Cons: Investments are restricted to New York City.
$2.99 billion in market capitalization
7.39% dividend yield

3. STAG Industrial Corp.
STAG Industrial Inc. (STAG) is a real estate investment trust (REIT) that focuses on acquiring and operating industrial properties in the United States. It spent $1.3 billion on 74 buildings totaling 12.9 million square feet in 2021 alone. As of February 4, its enterprise value was $7.7 billion, with 563 buildings totaling 111.6 million square feet. The company operates in 41 states.

Pros: One-of-a-kind opportunity to invest in warehouses; operates in the majority of states
Cons: It has a high P/E ratio of 27.50.
$6.75 billion in market capitalization
3.99% dividend yield

Read More: Top 3 Best Stocks to Consider Buying This 2023

4. Prospect Capital Corp.
Prospect Capital Corp. (PSEC) is a business development firm that invests in middle-market companies in the United States with both debt and equity. It does so across many industries and aims to provide investors with consistent returns. Its portfolio is worth $7.7 billion, and it has funded more than 400 investments. According to its website, it has declared approximately $3.8 billion in dividends for investors.

Advantages: High dividend yield
Cons: Institutional investors, such as mutual funds, have a low level of ownership.
$3.04 billion in market capitalization
9.41% dividend yield

5. Realty Income Corp. (O)
Realty Income Corp. (O) is a commercial real estate investment trust, or REIT that invests in real estate. The company, as a REIT, is so confident in its ability to pay monthly dividends that it refers to itself as The Monthly Dividend Company. It is also a component of the S&P 500 and the S&P 500 Dividend Aristocrats indexes.

Advantages: A long history of increasing dividends.
Cons: Recently an underperformer
$44.81 billion in market capitalization
4.39% dividend yield

Final Thoughts on These Dividend Stocks

Dividend stocks can be an excellent investment for those who require consistent income, such as retirees. These stocks typically operate in well-established industries, such as real estate, and can provide investors with consistent income. Some even pay monthly dividends, which is ideal if your portfolio is your primary source of income.

If you require monthly income from your portfolio, look for industries that pay consistent dividends, such as real estate, energy, and private equity. However, keep in mind that chasing high yields isn’t always the best strategy. Instead, look for companies that consistently raise their dividends.

Read More: 2023 Best Performing Dividend Stocks

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