While most of Wall Street focuses on large and mega-cap stocks, as they provide a degree of safety and liquidity, many investors are limited in the number of shares they can buy. Many of the most significant public companies, especially the technology giants, trade at prices up to $1,000 per share, while many are in the low to mid-hundreds. It is tough to get decent share count leverage at those steep prices.
24/7 Wall St. Key Points:
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Some on Wall Street now feel that the Federal Reserve will cut rates three times in 2025.
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Ultra-high-yield stocks will likely benefit from rate cuts.
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Stocks that pay monthly can be a substantial passive income bonus to a pension and Social Security.
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Most stocks come with quarterly dividends, which is fine for many shareholders who reinvest dividends. However, many investors rely on dividends as part of a passive income stream. So, receiving a monthly dividend payout is more beneficial. Typically, real estate investment trusts, business development companies, and closed-end funds are among the investment vehicles that pay distributions every month. We found five stocks trading under $10 that are tremendous bargains.
Why do we cover monthly pay stocks under $10?
We enjoy scouring the stock market for the next big winner, as it allows investors to buy a larger position in lower-priced stocks and potentially achieve a parabolic home run, similar to Nvidia or Netflix. Over the years, we have written about stocks like Zynga, which Take-Two Interactive acquired. Northern Oil & Gas was under $3 when we started covering the company. It underwent a reverse split and subsequently rose higher. While these ultra-high-yield monthly pay stocks may not be the next technology home run, they can generate substantial streams of passive income right now, and every month thereafter. Note that all five stocks were trading below the $10 level at the time of this writing.
AGNC Investment
AGNC Investment Corp. (NASDAQ: AGNC) has paid solid monthly dividends for years. It provides private capital to the U.S. housing market, enhancing liquidity in the residential real estate mortgage markets and, in turn, facilitating home ownership in the United States.
The company invests primarily in agency residential mortgage-backed securities on a leveraged basis. These investments consist of residential mortgage pass-through securities and collateralized mortgage obligations for which a U.S. government-sponsored enterprise guarantees the principal and interest payments.
AGNC buys debt from the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). Together, Fannie Mae and Freddie Mac are known as the GSEs, or government-sponsored enterprises. Alternatively, AGNC may purchase debt from a U.S. government agency, such as the Government National Mortgage Association (Ginnie Mae).
BlackRock Innovation and Growth Term Trust
This fund has lowered the dividend, which is a massive positive for shareholders who buy now. BlackRock Innovation and Growth Term Trust (NYSE: BTX) has investment objectives to provide total return and income through a combination of current income, current gains, and long-term capital appreciation. The trust will invest, under normal market conditions, at least 80% of its total assets in a combination of equity securities issued by U.S. and non-U.S. technology and privately held companies.
BTX holds well-known tech stocks, including Spotify Technology S.A. (NASDAQ: SPOT) and Reddit Inc. (NYSE: RDDT). The most prominent position is in AI chip giant Nvidia Inc. (NASDAQ: NVDA). It also holds a collection of private-equity holdings that give it hedge fund-type qualities. Think of this fund as a Cathie Wood-style vehicle for new technology with a massive dividend yield.
Trading at a small 2% discount to the fund’s net asset value, those seeking a substantial monthly income with growth potential should consider purchasing these shares now.
DNP Select Income Fund
While off the radar, this stock offers a more conservative approach to investing and a very dependable 8% dividend. DNP Select Income Fund (NYSE: DNP) is a closed-end diversified management investment company. The primary investment objectives of the fund are to generate current income and achieve long-term growth of income. Capital appreciation is a secondary objective.
The fund seeks to achieve its investment objectives by investing primarily in a diversified portfolio of equity and fixed income securities of companies in the public utilities industry.
It invests more than 65% of its total assets in securities of public utility companies engaged in the production, transmission, or distribution of electric energy, gas, or telephone services.
DNP Select Income invests in master limited partnerships, which make distributions that are primarily attributable to the return of capital. The fund’s policy of concentrating its investments in the utilities industry has been developed to capitalize on the characteristics of securities of companies in that industry. The investment advisor of the Fund is Duff & Phelps Investment Management.
Horizon Technology Finance
This is a venture lending platform that provides structured debt products to life sciences and technology companies. With a gigantic dividend, this stock has tremendous upside potential. Horizon Technology Finance Corp. (NASDAQ: HRZN) is a business development company that specializes in lending and investing in development-stage companies.
It focuses on making secured debt and venture lending investments to venture capital-backed companies in these industries:
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Technology
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Life science
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Healthcare information and services
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Cleantech
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Sustainability
Horizon Technology Finance is a leading venture lending platform that offers structured debt products to life science and technology companies. Its experienced investment and operations team has provided debt capital to some of the most exciting companies for decades.
PermRock Royalty Trust
PermRock Royalty Trust (NYSE: PRT) acquires, develops, and operates oil and natural gas properties in the Permian Basin. With a substantial dividend, this energy trust makes sense as spot oil prices appear poised to rebound. This statutory trust owns a net profits interest representing the right to receive 80% of the net profits from the sale of oil and natural gas production from the underlying properties. T2S Permian Acquisition II owns and operates the underlying properties.
The underlying properties comprise about 31,354 gross (22,394 net) acres in the Permian Basin, which extends over 75,000 square miles in West Texas and southeastern New Mexico.
The underlying properties consist of four operating areas.
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The Permian Clearfork area consists of about 2,434 net acres on the Central Basin Platform of the Permian Basin in Hockley and Terry Counties, Texas.
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Permian Abo area consists of about 1,667 net acres on the Central Basin Platform of the Permian Basin in Terry and Cochran Counties, Texas.
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The Permian Shelf area consists of 14,390 net acres on the Eastern Shelf of the Permian Basin.
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The Permian Platform area consists of 3,903 net acres.
Five Stocks Paying 7% and Higher Dividends That Nobody Ever Talks About
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