My 2 Favourite Stocks for Monthly Passive Income
These two monthly dividend stocks could help investors build a steadier stream of passive income.
Posted by Jitendra Parashar
Published June 9
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- Monthly dividend stocks could help investors turn a portfolio into a steadier passive-income source.
- Canadian Apartment Properties Real Estate Investment Trust (TSX:CAR.UN) offers monthly income backed by a large rental-housing portfolio.
- Peyto Exploration & Development (TSX:PEY) pairs a 5.6% yield with strong production growth and disciplined hedging.
Monthly dividend stocks could be really useful for Foolish investors who want their portfolios to feel more like a steady income source than a long-term savings bucket. More frequent cash distributions increase their appeal, making it easier to plan, reinvest, or gradually build a more reliable passive-income stream, instead of waiting for quarterly payouts.
However, that does not mean you can jump on any monthly payer without paying attention to its business fundamentals. They still need to have durable business models, manageable payout profiles, and enough growth potential to support income in the long haul.
Let me highlight two of my favourite TSX stocks I like for investors seeking monthly passive income.
Canadian Apartment Properties REIT stock
For investors who want monthly income tied to an essential real estate niche, Canadian Apartment Properties Real Estate Investment Trust (TSX:CAR.UN) could be a natural place to start. This real estate investment trust (REIT) owns and manages roughly 45,500 residential apartment suites and townhomes across Canada and the Netherlands, giving it a large rental-housing platform with geographic diversification.
The company focuses on maximizing occupancy and responsibly growing occupied average monthly rent (AMR), which has helped support its operating performance. In the March 2026 quarter, Canadian Apartment Properties REIT’s operating revenues were $247.9 million, while its net operating income (NOI) came in at $155 million, down 1.9% year-over-year (YoY). Even so, its same-property NOI rose 2% YoY to $146.3 million, pointing to stable underlying demand across its portfolio.
The REIT also completed the privatization of European Residential REIT (ERES) for $98.7 million, acquiring the publicly held units it did not already own. That move gives it more control over its European assets and the timing of future portfolio decisions.
Moreover, Canadian Apartment Properties REIT remains focused on upgrading the quality and diversification of its property portfolio through repositioning and capital recycling. With a 4.5% dividend yield and monthly distributions, Canadian Apartment Properties REIT offers investors a practical mix of recurring income and long-term rental-housing exposure.Zoom1M3M6MYTD1Y5Y10YALL
Peyto Exploration & Development stock
The second stock brings a very different kind of monthly income stream to investors. Peyto Exploration & Development (TSX:PEY) gives investors exposure to Alberta natural gas, oil, and natural gas liquids production, along with a dividend yield that is notably higher than that of many large-cap income stocks.
At the time of writing, PEY stock traded at $25.22 per share with a market cap of $5.2 billion. The stock has climbed 31% over the last year while offering a 5.6% dividend yield, making it an appealing option for income investors comfortable with the natural volatility of the energy sector.
Peyto recently posted record first-quarter results, with its production averaging 147,513 barrels of oil equivalent per day (boe/d), up 10% YoY. Similarly, its funds from operations jumped 20% sequentially to $293 million.
The company’s hedging strategy remains an important part of its plan. Peyto’s mechanistic hedging program secured $715 million in revenue for April–December 2026 and $510 million for 2027, helping reduce some of the uncertainty that could come with commodity price volatility.
More importantly, Peyto plans to invest $450–$500 million in 2026 to add 43,000–48,000 boe/d of new production by year-end. It also expects to operate four to five rigs for the remainder of the year, with a focus on liquid-rich opportunities in the Cardium and Falher formations.
Foolish takeaway
Together, Canadian Apartment Properties REIT and Peyto offer two very different paths to monthly passive income. One is backed by rental housing and recurring real estate cash flow, while the other offers higher income potential from a disciplined energy producer. For investors building a TSX portfolio focused on consistent cash flow, both monthly dividend stocks deserve a closer look today.
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