Category Monthly Dividend

Unlike in President Donald Trump’s first administration, manufacturers may have no place to hide as widespread tariffs could disrupt global supply chains.

Trump’s tariffs unveiled last week that will be levied against imports from a long list of countries, including 34% on goods from China, 26% on India, and 20% on the European Union. Trump has said the goal of the tariffs is to reorder global trade and bring more manufacturing back to the U.S. However, economists think that instead of relocating to the U.S., manufacturers may just get tangled up in supply chain challenges.

“Broad tariffs across global trading partners, unlike prior narrower bilateral ones, limit the ability of the global trading system to adapt,” wrote Deutsche Bank economists and researchers. “This comes at the cost of fundamentally undermining global supply chain models that have emerged over the past several decades.”

Wide Range of Tariff Targets Leaves Little Room for Supply Chains to Adapt

After Trump first introduced tariffs on China during his first term in 2018, supply chains reoriented through countries like Mexico and Vietnam. However, Vietnam is now facing a 46% tariff under the new policy, and Mexico has already been hit with a 25% tariff on all goods not covered by the USMCA trade agreement.

Many manufacturers are also reluctant to move their operations to the U.S., where labor is often more costly than where they are currently producing their products. According to an Apollo analysis, the typical U.S. manufacturing worker earns nearly $6,000 a month, while their counterpart in China makes just over $1,100, and an Indian manufacturing worker only makes around $195.

That means importers have few options to avoid the tax this time around.

“If the U.S. imposes high tariffs on Mexico, China, India and the European Union, and cuts off aid to major resource economies in Africa, there isn’t much room left for the global supply chain to move,” said Vidya Mani, University of Virginia associate professor of business administration, during an interview on the school’s website.

Supply Chain Changes Could Be Costly for Companies

Some industries will be impacted by supply chain disruptions more than others; apparel and automobiles are particularly susceptible to trade disputes. In some cases, it will be more cost-effective for companies to pay the tariffs than relocate their production, Mani said. 

“Changing the supply chain in response to high tariffs is a massive undertaking and lasts beyond any one administration,” Mani said.

And while some of the tariff costs will be passed onto consumers, it’s also likely that profit margins will drop for corporations that import into the U.S. 

“We will be paying close attention to where sales are generated and the level of cross-border trade within companies to establish how they might be affected,” wrote Janus Henderson fixed-income portfolio managers Brent Olson and Tim Winstone.

The major U.S. equity indexes were lower at midday Monday, extending last week’s losses as the Trump administration showed no signs of pulling back from sweeping reciprocal tariffs. The Dow Jones Industrial Average, S&P 500, and Nasdaq all lost ground.

Tesla (TSLA) shares tumbled as the tariff-fueled selloff continued, and Wedbush analysts led by bull Dan Ives cut their price target for the stock to $315 from $550 previously.

Nike (NKE) shares fell amid worries that its key manufacturing partners in Vietnam, Cambodia, China and Indonesia would face punishing tariffs. 

Goldman Sachs (GS) shares also dropped after Morgan Stanley analysts downgraded the bank to “equal-weight” from “overweight,” citing the Wall Street bank’s large exposure to investment bank revenues amid rising recession risks and “deteriorating market conditions.”

Dollar Tree (DLTR) shares soared as Citi analysts upgraded the stock to a “buy” on the discount-retail chain’s potential to raise prices in the new tariff environment.

Mesa Air Group (MESA) soared after the carrier agreed to merge with fellow regional carrier Republic Airways in an all-stock transaction.

U.S. Steel (X) shares jumped as President Trump announced his administration would undertake a new review of the company’s merger with Nippon Steel.

Oil and gold futures sank. The yield on the 10-year Treasury note edged higher. The U.S. dollar gained ground against the euro and yen but fell against the pound. Prices for most major cryptocurrencies fell.

Stocks have been hit hard. That’s cut into the wealth of a broad swath of Americans. 

More than 60% of Americans have money in the market, according to Gallup data from May, up from a bit above 50% in the middle of the last decade. That reflects comparatively large holdings among those with annual incomes at or above $100,000—but Gallup also found that about two-thirds of middle-income Americans, and a quarter of those with annual incomes below $40,000, were invested through some combination of stocks or funds. 

That tracked with data released in late 2023 by the Federal Reserve, which found that more than a third of families in the bottom half of the U.S. income distribution held stock—along with more than three-quarters of the upper-to-middle income group and 95% of the top decile.

Last’s week’s dramatic and downbeat market response to the Trump administration’s latest announcement on tariffs has led many investors, from Wall Street to Main Street, to wrestle with how to respond as they’ve seen their portfolios shrink.

A steep two-day drop-off left some waiting for the market to change direction and others who expect the drubbings to continue; Monday morning, stocks have whipsawed. (Follow Investopedia’s live coverage of today’s markets here.) 

About a fifth of Americans who invest in stocks believe they have a “high” risk tolerance, according to YouGov data released Friday, while about 40% said they generally maintain their investments amid economic or market uncertainty.

“Your brain has identified a risk and it’s screaming at you to run away. It’s working as intended. Otherwise, I’d recommend you get your head checked,” wrote Callie Cox, chief investment strategist at Ritholtz Wealth Management, in an emailed commentary. “Honor your natural tendencies, but don’t listen to them. In many situations, touching the hot stove isn’t the best solution.”

JPMorgan Chase (JPM) CEO Jamie Dimon wrote in his annual letter to shareholders Monday that the Trump administration’s newly announced tariffs are likely to slow growth and raise prices.

“For the short-term, we are likely to see inflationary outcomes, not only on imported goods but on domestic prices, as input costs rise and demand increases on domestic products,” Dimon wrote. “How this plays out on different products will partially depend on their substitutability and price elasticity. Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth.”

Dimon said that President Trump’s policy platform of “America First is fine, as long as it doesn’t end up being America alone.”

Negative Tariff Effects ‘Would Be Hard to Reverse’

The CEO also said that once the currently proposed tariffs are negotiated, he hopes there are long-term positive impacts for the U.S., like increased manufacturing. However, Dimon stressed the need to resolve the tariff issue quickly, “because some of the negative effects increase cumulatively over time and would be hard to reverse.”

Dimon and other banking executives are likely to give their first extended thoughts on tariffs and the current state of the economy on their first-quarter earnings calls. JPMorgan is slated to report its results Friday.

For more of the market’s reaction to the latest tariff news, check out Investopedia’s daily live markets coverage.

Banks are scaling back their 2025 outlooks for U.S. stocks as uncertainty about the economy and markets escalates.

The benchmark S&P 500 could slump to 4,700, a further 7%-8% decline from Friday’s close, if President Donald Trump sticks with his tariff plans or the Federal Reserve doesn’t ease interest rates, Morgan Stanley analysts wrote.

The analysts said they had offered a 5,100-5,200 technical support level for the S&P 500 last Thursday but noted that “with the market quickly trading there on Friday and overnight futures down another 3-5% so far, our thoughts turn to the next area of support, which lies closer to the 200-week moving average, or 4700.”

Oppenheimer analysts on Monday cut their target to 5950, about a 17% premium to Friday’s close, from 7100. Read Investopedia’s live coverage of today’s trading here.

“The equity market appears oversold in our view,” Oppenheimer’s analysts wrote, “with uncertainty at levels investors find hard to embrace along with what we call ‘a negative pitch book’ that seemingly projects negative outcomes to infinity that’s taken hold in the near term of trader, investor, and consumer sentiment. 

The index closed at 5,074.08 Friday, having suffered the seventh-worst week in the last 25 years, a decline of more than 9%. S&P futures are down 2.7% early Monday.

“Valuations also offer better support at that price so investors should be prepared for another 7-8% potential downside from Friday’s close if there is no line of sight to a less severe trade environment and the Fed remains firmly on hold,” Morgan Stanley’s analysts wrote.

Trump so far has shown no signs of backing down from the tariffs, while Fed officials have elected to keep their key interest rate steady. Fed Chair Jerome Powell said Friday that Trump’s larger-than-expected tariffs could stoke inflation and slow economic growth. 

This article has been updated to add context and the new Oppenheimer estimate.

Goldman Sachs analysts told clients Sunday they are cutting their forecast for gross domestic product (GDP) growth in 2025, and raising their recession risk forecast in response to the Trump administration’s new tariffs.

The analysts now put a 45% chance on a recession coming in the next year, up from 35% previously, due to a “sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty that is likely to depress capital spending by more than we had previously assumed.”

However, that 45% is predicated on the effective tariff rate rising by 15 points, less than it’s currently expected to rise if the Trump administration’s tariffs announced last week go into effect on Wednesday. If most or all of those tariffs are enacted and the effective tariff rate rises by roughly 20 points, the analysts said the likelihood of a recession could rise above 50%.

The Goldman analysts lowered their GDP growth forecasts to 0.5% for the fourth quarter and 1.3% for 2025, down from 1% and 1.5%, respectively.

The analysts said they now expect the Federal Reserve to make three consecutive quarter-point rate cuts starting in June, a month earlier than they previously expected cuts to start. In a recession, they expect about 2 points in total cuts over the next year.

Stock futures were down sharply Monday morning, extending last week’s tariff-fueled selloff after the stock market had one of its worst weeks in years. (Read Investopedia’s live coverage of today’s market action here.)

Global stocks are slumping Monday, extending their rout, as President Donald Trump’s sweeping reciprocal tariffs and China’s retaliatory duties sparked a flight into haven assets and raised fears of a U.S. recession.

The Stoxx Europe 600 index is about 6% lower, while Japan’s Nikkei closed down almost 8%, and Hong Kong’s Hang Seng, where the biggest Chinese companies are listed, cratered 13%. Meanwhile, U.S. stock futures are tumbling, with those associated with the Dow Jones Industrial Average down 1,300 points, or 3.6%, Nasdaq futures 3.7% lower, and S&P 500 futures down 4%.

The flight from risk is driving up bonds and sending the 10-year Treasury yield down to 3.95%. Wall Street’s “fear gauge,” the VIX index of implied stock market volatility, is surging to its highest levels since the early days of the pandemic, while oil prices—already dealing with the prospect of increased supply—are plunging, with West Texas Intermediate futures down 4% at around $59.

The sharp selloff comes as Trump doubled down on his tariffs Sunday night, saying, “I don’t want anything to go down, but sometimes you have to take medicine to fix something,” according to reports.

Goldman Sachs raised its odds of a U.S. recession to 45% in the next 12 months from 35%, “following a sharp tightening in financial conditions, foreign consumer boycotts, and a continued spike in policy uncertainty that is likely to depress capital spending by more than we had previously assumed.”

Updated on April 1st, 2025 by Felix Martinez

Extendicare (EXETF) has two appealing investment characteristics:

#1: It is a high-yield stock based on its 3.9% dividend yield.
Related: List of 5%+ yielding stocks.
#2: It pays dividends monthly instead of quarterly.
Related: List of monthly dividend stocks

You can download our full Excel spreadsheet of all 76 monthly dividend stocks (along with metrics that matter, like dividend yield and payout ratio) by clicking on the link below:

A high dividend yield and a monthly dividend make Extendicare appealing to income-oriented investors. The company is also ideally positioned to benefit from the secular growth of demand for healthcare services. In this article, we will discuss Extendicare’s prospects.

Business Overview

Through its subsidiaries, Extendicare provides care and services for seniors in Canada. The company offers long-term care (LTC) services; home health care services, such as nursing care, occupational, physical, and speech therapy, assistance with daily activities, and contract and consulting services to third parties. It operates LTC homes, retirement communities, and home healthcare operations under the Extendicare, ParaMed, Extendicare Assist, and SGP Partner Network brands. The company was incorporated in 1968 and is based in Markham, Canada.

Extendicare operates or provides contract services to a network of 103 long-term care homes and retirement communities, providing approximately 11 million hours of home health care services annually.

Source: Investor Presentation

Extendicare has been hurt by the coronavirus crisis, which has caused many problems in the company’s daily operations. COVID-19, influenza, and other viruses have resulted in abnormally high employee absenteeism, thus exacerbating an already tight labor market. As a result, Extendicare has seen its operating costs increase significantly since the onset of the coronavirus crisis.

Growth Prospects

Extendicare is ideally positioned to benefit from a strong secular trend, namely the growing demand for healthcare services. The demand for health care from seniors who are above 85 years old is growing at a 4% average annual rate.

Source: Investor Presentation

Moreover, there is an immense backlog of demand for long-term care beds, with more than 48,000 seniors waiting for a bed in Ontario alone. According to official estimates, there will be a need for more than 200,000 new long-term care beds in Canada by 2035. Thanks to its 55 years of experience in this business, Extendicare is ideally poised to benefit from the secular growth in the demand for health care services.

On the other hand, investors should be aware that Extendicare has exhibited a volatile performance record. Due to the aforementioned impact of the pandemic on its business, the company has not grown its earnings per share over the last decade. Therefore, the stock is suitable only for patient investors, who can endure extended periods of poor business performance and stock price volatility and remain focused in the long run. Given the low comparison base formed this year, we expect the company to grow its earnings per share by about 5.0% per year on average over the next five years.

Dividend & Valuation Analysis

Extendicare currently offers a 3.9% dividend yield. It is thus an interesting candidate for income-oriented investors, but the latter should be aware that the dividend may fluctuate significantly over time due to the fluctuation of the exchange rates between the Canadian dollar and the USD.

The company has a decent payout ratio of 68%. To cut a long story short, the 3.9% dividend will not likely be cut soon, but given the company’s material interest expense, it is not entirely safe in the long run.

Regarding the valuation, Extendicare is trading for 12.9 times its earnings per share in the last 12 months. We assume a fair price-to-earnings ratio of 10.0 for the stock. Therefore, the current earnings multiple is higher than our assumed fair price-to-earnings ratio. If the stock trades at its fair valuation level in five years, it will have a -2.2 % annualized compression for the next five years.

Taking into account the 5% annual growth of earnings per share, the 3.9% dividend, and a -3.5% annualized compression of valuation level, Extendicare could offer a 5.4% average annual total return over the next five years. This is certainly a fair expected return. Nevertheless, the stock is suitable only for patient investors who are comfortable with Extendicare’s volatile business performance and stock price.

Final Thoughts

Extendicare has a solid business model and greatly benefits from the growing demand for healthcare services. The stock offers an attractive dividend yield of 3.9% with a healthy payout ratio of 68%, making it an attractive candidate for income-oriented investors’ portfolios. The stock has an expected return of 5.4% per year over the next five years.

On the other hand, investors should be aware of the risk resulting from the company’s somewhat weak balance sheet and its choppy business performance. Therefore, the stock is suitable only for patient investors, who can ignore stock price volatility and remain focused in the long run.

Moreover, Extendicare is characterized by exceptionally low trading volume. This means that it is hard to establish or sell a large position in this stock.

Don’t miss the resources below for more monthly dividend stock investing research.

And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.

Updated on April 1st, 2025 by Felix Martinez

Investors seeking a dependable and consistent source of income may find it advantageous to invest in companies that distribute monthly dividends. This can significantly enhance predictability and reduce the uncertainty associated with investing in equities. Thus, monthly dividend stocks can be particularly useful during the highly volatile market environment.

That said, just 76 companies currently offer monthly dividend payments, which can severely limit an investor’s options. You can see all 76 monthly dividend-paying names here.

You can download our full Excel spreadsheet of all monthly dividend stocks (along with metrics that matter, like dividend yield and payout ratio) by clicking on the link below:

One name that we have not yet reviewed is First National Financial Corporation (FNLIF), a Canadian-based company in the financial services industry. Currently, the stock has a yield of almost 8%, which is many times that of the yield of the S&P 500 Index. Given that the company pays out dividends on a monthly basis, it may be a fitting pick for income-oriented investors.

This article will evaluate the company, its business model, and its distribution to determine whether First National Financial Corporation is a good candidate for purchase.

Business Overview

Over the last three decades, First National has grown to become a recognized and respected leader in real estate financing. As Canada’s biggest non-bank issuer of single-family residential mortgages, the company provides a comprehensive array of mortgage solutions tailored to suit each client’s unique requirements, lifestyle, and financial objectives.

Additionally, First National offers commercial mortgages, attributing its triumph to its team of experts who are among the most respected and renowned in the industry.

Source: Annual Report

Growth Prospects

To grow its revenues and earnings, First National can primarily rely on two factors – expanding its mortgage portfolio and increasing its interest income.

Assessing First National’s growth prospects is somewhat challenging these days due to the highly uncertain nature of the evolving interest rates. At first glance, the company’s revenues and income rose last year as it earned more on its existing mortgage portfolio.

That said, rising interest rates are generally not beneficial for mortgage issuers for a few reasons:

1. First, when interest rates rise, it becomes more expensive for potential buyers to take out mortgages, resulting in lower demand for mortgages. We saw this happening in the company’s 2022 results.
2. Second, First National could experience a decrease in profitability, as higher interest rates can also lead to higher borrowing costs for the company. This wasn’t the case last year, but it could be once the company has to refinance its own debt.
3. Third, as interest rates rise, some borrowers may find it difficult to make their mortgage payments, which can result in an increase in the number of defaults. This, in turn, can cause mortgage issuers to suffer losses as they may have to repossess and sell properties at a loss.

Therefore, despite last year’s improving results, it’s important to note that if interest rates remain high, the company’s profitability may not be as strong in the upcoming years.

Overall, the company’s earnings track record is quite volatile, which can be attributed to various factors that have the potential to impact its profitability depending on the prevailing macroeconomic conditions significantly. Still, First National’s earnings tend to trend upward over the long term.

Dividend Analysis

First National is currently yielding 7.8% and boasts a remarkable record of dividend payments. In fact, First National is a member of the S&P/TSX Canadian Dividend Aristocrats Index.

Although the dividend decreased by approximately 20% in 2010 due to the adverse impact of the Great Financial Crises on the real estate mortgage market, it has grown steadily every year from 2011 onward.

Specifically, the company’s dividend has grown at a compound annual growth rate of 6.4% over the past decade, mirroring its earnings-per-share growth over the same period.

Source: Investor Relations

Moving forward, we believe that First National may slow down the pace at which it grows its dividend. This is because the current payout ratio, at 65%, already appears relatively high, and profitability could decline in the coming years due to higher interest rates.

Therefore, the company is unlikely to take the risk of pushing the payout ratio to a level that could jeopardize its financial stability.

Final Thoughts

First National is likely to experience profitability headwinds in the coming years, especially if interest rates remain elevated. While higher interest income on its existing mortgage portfolio could somewhat offset the lack of new originations, the company’s own financial expenses are likely to pressure its bottom line.

That said, for investors seeking a steady stream of monthly income and an above-average yield, First National may be an attractive option. Despite operating in a challenging environment, the company has maintained a reasonable payout ratio and even slightly increased its dividend last year, indicating its commitment to rewarding its shareholders.

As such, income-oriented investors will likely find value in the stock despite any short-term financial setbacks due to higher interest rates.

Don’t miss the resources below for more monthly dividend stock investing research.

And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.

Published on April 1st, 2025 by Felix Martinez

Freehold Royalties (FRHLF) has two appealing investment characteristics:

#1: It is a high-yield stock based on its 8.4% dividend yield.
Related: List of 5%+ yielding stocks.
#2: It pays dividends monthly instead of quarterly.
Related: List of monthly dividend stocks

You can download our full Excel spreadsheet of all 76 monthly dividend stocks (along with metrics that matter, like dividend yield and payout ratio) by clicking on the link below:

Combining a high dividend yield and a monthly dividend renders Freehold Royalties appealing to income-oriented investors. In addition, the company is ideally positioned to benefit from high production growth in exceptionally rich resource areas in North America. In this article, we will discuss the prospects of Freehold Royalties.

Business Overview

Freehold Royalties is focused on acquiring and managing royalty interest in crude oil, natural gas, natural gas liquids, and potash properties in Western Canada and the United States. The company was founded in 1996 and is headquartered in Calgary, Canada.

Freehold Royalties aims to deliver growth and attractive risk-adjusted returns to its shareholders by acquiring high-quality assets with acceptable risk profiles and long economic lives. It then tries to generate highly profitable lease-out programs for the development of its properties.

Freehold Royalties generates approximately 93% of its revenues from oil and natural gas liquids and the remaining 7% from natural gas.

Source: Investor Presentation

Moreover, the company generates 55% of its revenue from its properties in Canada and the remaining 45% from its properties in the U.S.

As an oil and gas royalty company, it is only natural that Freehold Royalties has exhibited a highly volatile performance record. The royalties that its new customers are willing to pay are greatly affected by the prevailing oil and gas market conditions and the underlying prices of oil and gas.

In addition, the oil and gas production of its existing customers significantly varies from year to year, as it is dependent on the prevailing oil and gas prices. Thus, it is not surprising that Freehold Royalties has posted losses in three of the last ten years.

Growth Prospects

Freehold Royalties currently enjoys decent business momentum. The company has grown its production by 38% over the last four years to a new record level.

Such a high production growth rate is extremely rare in the oil and gas industry. To provide a perspective, most oil majors, such as Shell (SHEL) and BP (BP), have failed to grow their output over the last several years. This is a key difference between Freehold Royalties and most oil and gas producers.

On the other hand, Freehold Royalties is inevitably sensitive to the oil and gas industry cycles. This is clearly reflected in the company’s volatile performance record. During the last decade, Freehold Royalties has failed to grow its earnings per share. In addition, the company has posted losses in three of the last ten years and negligible profits in three of the last ten years.

Freehold Royalties currently enjoys decent business momentum, not only thanks to its high production growth but also thanks to the deep production cuts implemented by OPEC in an effort of the cartel to support the price of oil. The price of natural gas has remained depressed this year, primarily due to an abnormally warm winter, but oil prices have remained above average. As a result, Freehold Royalties is likely to post above-average profits this year.

Given the decent business momentum and the cyclical nature of the Freehold Royalties business, we expect approximately flat earnings per share in five years from now.

Source: Investor Presentation

Dividend & Valuation Analysis

Freehold Royalties is currently offering an exceptionally high dividend yield of 8.4%, which is seven times as much as the 1.2% yield of the S&P 500. The stock is thus an interesting candidate for income-oriented investors, but the latter should be aware that the dividend is not safe due to the cyclical nature of the oil and gas industry.

Freehold Royalties is paying a generous dividend, but its earnings have decreased significantly vs. the 10-year high earnings per share of $1.03 in 2022. As a result, the payout ratio has risen from 68% in 2022 to 90%. Such a payout ratio is unsustainable over the long run.

Given its dramatic cycles, management should be praised for its pristine balance sheet, which is paramount in the energy sector. On the other hand, due to the inevitable swings in oil and gas prices, Freehold Royalties’ dividend is far from safe. Notably, the company has cut its dividend in three of the last ten years.

In addition, U.S. investors should be aware that the dividend received from this stock depends on the exchange rate between the Canadian and U.S. dollar.

In reference to the valuation, Freehold Royalties has traded for 12.4 times its earnings per share in the last 12 months. We assume a fair price-to-earnings ratio of 10.0 for the stock. Therefore, the current earnings multiple is much higher than our assumed fair price-to-earnings ratio. If the stock trades at its fair valuation level in five years, it will incur a -5.9% annualized drag in its returns.

Taking into account the flat earnings per share, the 8.4% dividend yield and a -5.9% annualized contraction of valuation level, Freehold Royalties could offer just a 2.5% average annual total return over the next five years. This is a low expected total return and hence we recommend waiting for a significantly lower entry point in order to enhance the margin of safety and increase the expected return from this highly cyclical stock.

Final Thoughts

Freehold Royalties has much better prospects in growing its production and reserves than most of its peers and offers an above-average dividend yield of 8.4%. The company also has a rock-solid balance sheet, which is likely to entice some income-oriented investors.

However, the company’s performance record has been highly volatile due to its business cycles, and it seems almost fully valued right now. Therefore, investors should wait for a much more attractive entry point.

And see the resources below for more compelling investment ideas for dividend growth stocks and/or high-yield investment securities.