In the working world, compensation arrives every two weeks or monthly to match ongoing expenses and charges.

In the stock market, payouts known as dividends typically arrive quarterly. That creates a mismatch of 30 days between bills but a full 90 days between distributions.

Hence the appeal of monthly dividends. These management teams recognize that investors holding their shares expect regular payments. The amount must arrive every 30 days and remain consistent. No reductions permitted.

However, some of these monthly payers issue checks their operations cannot sustain. So let's review the past decade of distributions from the six largest monthly payers in America. We focus on two questions:

Did the monthly payment arrive on schedule and in full?

And could investors receive their payments without pressuring the share price lower?

Here is the list, with a key finding: half of these monthly dividend firms failed to maintain payments across a full decade.

The 6 Biggest Monthly Dividend Payers

Why emphasize 10-year total return when dividends are the focus? Because a declining share price is not desirable. When relying on dividends in retirement, the principal should remain stable or grow.

As shown, this is not a list for automatic purchases. Several issues stand out. For instance, landlord EPR Properties (EPR) once appealed to retirees. It gathers rent from experience venues such as Topgolf and ski resorts. Younger generations prioritize experiences over possessions, which seemed ideal.

That changed in 2020. The world paused in March, and by May EPR suspended its monthly distribution. The temporary halt lasted fourteen months as reopening took time.

Then there is Apple Hospitality (APLE), a hotel landlord with about 220 properties under Marriott and Hilton brands. Business travel drives much of its revenue, which stopped in March 2020. Its monthly payout likewise ceased.

When APLE restarted payments in March 2021, they came quarterly at just a penny per share. The monthly schedule returned only in March 2022, two years later.

Agree Realty (ADC) posted the second-highest total return in the review at 135% over ten years. This came from rents at retailers like Walmart and Tractor Supply.

Agree is relatively new to monthly payments. It distributed quarterly until January 2021, when it switched to monthly and has maintained that schedule since. Five of the ten years involved monthly payouts, marking it as a recent adopter.

Realty Income (O) stands apart. It trademarked The Monthly Dividend Company and has paid every 30 days for decades. Yet a 48% total return over ten years falls short of expectations.

AGNC Investment Corp (AGNC) also underperformed despite its generous headline yield paid monthly. The total returns tell the story.

The firm operates as a mortgage REIT, purchasing relatively safe mortgage-backed securities from agencies like Fannie and Freddie. To boost income it uses leverage by borrowing to acquire more assets. When borrowing costs rise, profitability suffers.

In March 2020 AGNC reduced the monthly payout from $0.16 to $0.12 and never restored the prior level. This holding suits short-term use rather than long-term reliance. Investors over the decade saw just 88% total return, equating to 6.5% annualized. The stock offers a 12.9% monthly yield but loses nearly 6% yearly in price, which is not sustainable.

The standout is Main Street Capital (MAIN), a business development company. It has paid monthly without interruption since its 2007 IPO.

MAIN also grew investor wealth. Shares rose 59% over the decade before dividends, reaching 236% with payouts included, the highest in the group.

What sets MAIN apart are its dual approaches. Most peers lend and collect interest, but MAIN also takes equity positions alongside debt.

Management remains positive, recently declaring its 19th straight quarterly bonus dividend atop the regular monthly payout, which rose 4% this year. That produces an 8.4% yield including specials, with another bonus likely in September. Net asset value reached a record high with no decline.

Insiders hold 3.8% of MAIN, or about 3.7 million shares, which is high for a BDC. They manage it as owners.

Should investors buy MAIN now? Caution is warranted amid private credit concerns before committing to MAIN or any monthly payer. Avoid blind purchases that could lead to underperformers like AGNC. Consider instead these elite 11%+ dividends paid monthly.

Further AGNC Research:

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Future Dividend Aristocrats: Close Contenders

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.