"Most investors still wait four long quarters for a dividend check, then wonder why their monthly budgets refuse to cooperate. Moreover, the small dividend yield of 1-3% will compound slowly if you reinvest and is unlikely to cover your expenses if you are already retired. The best idea is to balance your dividend portfolio using a barbell strategy. Have a few high-yield dividend payers in your portfolio, not too high to be unsustainable, but high enough to truly make a difference in the long run."
"Tenants handle most operating expenses, and this translates into stable income for the REIT. Free cash flow has consistently been above the cash spent on dividends. Q2 FCF was $18 million, $15 million being spent on dividends. The gap between available cash and dividend payouts has narrowed with time, but the dividends are unlikely to be cut, and the bottom line is stable enough to sustain it for a long time. If you look at funds from operations (FFO), the dividend looks even more sustainable."
Quarterly dividend payments and low 1-3% yields can leave monthly budgets strained and provide slow compounding for retirees. A barbell strategy that pairs several sustainable, higher-yield dividend payers with solid blue-chip dividend stocks can boost income while managing risk. Three selected dividend stocks can deliver a roughly 7% monthly yield. Modiv Industrial invests in industrial manufacturing facilities with tenants aligned to the U.S. supply chain, benefiting from nearshoring and tariffs. Tenants cover most operating expenses, free cash flow has exceeded dividend payouts, and forward FFO supports the current dividend level. Freehold Royalties acquires and manages royalty interests in crude oil and natural gas.
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