Why LTC Properties Inc. (LTC) is Among the Best Stocks That Pay Monthly Dividends in 2024

LTC Properties Inc. (NYSE: LTC) has consistently been one of the top choices for investors seeking monthly dividend stocks. With a record of 235 consecutive monthly dividend payments and a current yield of nearly 6%, LTC offers a strong return for all investors, particularly retirees on fixed incomes. In this article, we will explore why LTC is among the best stocks that pay monthly dividends in 2024.

Consistent Dividend History and Growth

LTC Properties has a proven track record of maintaining and growing its dividend payments. The company's consistent cash flow, generated from its diversified portfolio of seniors housing and healthcare properties, enables it to distribute a steady and predictable income stream to shareholders. This consistency is a testament to LTC's financial stability and reliability, making it an attractive option for income-oriented investors.

Stable Cash Flow and Dividend Payments

LTC's investments in seniors housing and healthcare properties play a significant role in its stable cash flow and dividend payments. The company's diversified portfolio, which is approximately 50% seniors housing and 50% skilled nursing properties, provides a steady stream of rental income. This income is generated through sale-leasebacks, mortgage financing, joint-ventures, and structured finance solutions, including preferred equity and mezzanine lending.

LTC's investment strategy focuses on acquiring properties with strong operating partners and stable cash flows. As of 2024, the company's investment portfolio consists of 201 properties in 26 states, with 29 operating partners. This diversification helps mitigate risks associated with relying on a single property or operator, further contributing to the stability of LTC's cash flow.

Balance Sheet Strength and Financial Flexibility

LTC Properties' balance sheet strength and financial flexibility support its ability to maintain and grow its monthly dividends. As of 2024-12-29, LTC has a strong balance sheet with a market capitalization of $1557876608 and a current stock price of $34.42 USD. The company's investment portfolio is diversified, consisting of approximately 50% seniors housing and 50% skilled nursing properties across 201 properties in 26 states, with 29 operating partners.

LTC's financial flexibility is evident in its cash position, with total cash of $35040000 as of the same date. This cash position allows the company to meet its dividend obligations and invest in growth opportunities. Additionally, LTC's operating cash flow for the period ending 2024-09-30 was $117350000, indicating a strong cash-generating ability that supports its dividend payments.

Dividend Coverage Ratio

LTC's dividend coverage ratio is 1.8x, which is higher than the average dividend coverage ratio of other REITs and the broader market. This indicates that LTC has a strong ability to cover its dividend payments with its earnings, providing additional assurance to investors that the company's dividend is sustainable.

Conclusion

LTC Properties Inc. (LTC) is among the best stocks that pay monthly dividends in 2024 due to its consistent dividend history and growth, stable cash flow and dividend payments, balance sheet strength and financial flexibility, and strong dividend coverage ratio. The company's investments in seniors housing and healthcare properties, diversified portfolio, and focus on acquiring properties with strong operating partners and stable cash flows contribute to its ability to maintain and grow its dividend payments. LTC's strong balance sheet, cash position, and cash flow generation further support its dividend-paying capacity. With a current yield of nearly 6%, LTC offers a strong return for investors, particularly retirees on fixed incomes.