Small-cap dividend stocks are an excellent way for investors to get a steady stream of income while also participating in the growth potential of companies that have not yet reached their full potential. While small-cap stocks can be more volatile than larger, more established companies, there are several small-cap dividend stocks that could be worth considering for those looking to diversify their portfolio.
One such company is Atrion Corporation (ATRI). This medical device manufacturer has a market cap of just over $1 billion and has consistently paid dividends since 2002. The current yield for ATRI is around 0.85%, which may seem low, but its track record of consistent payouts should appeal to long-term investors.
Another small-cap company with a solid history of paying dividends is Computer Services Inc. (CSVI), a provider of banking software and technology solutions. CSVI has been paying dividends since 1971 and currently yields around 2%. Despite being in the highly competitive tech industry, CSVI’s focus on niche markets has allowed it to remain profitable year after year.
For those interested in the healthcare sector, Cerner Corporation (CERN) may be worth considering. With a market cap just over $22 billion, CERN isn’t exactly small-cap compared to some other options on this list, but it still offers plenty of growth potential. The company provides electronic health records and other technology solutions for healthcare organizations and currently pays out a modest yield of about 0.6%.
Moving away from healthcare and into real estate investment trusts (REITs), we have EPR Properties (EPR). This REIT focuses on investing in entertainment properties like movie theaters and ski resorts as well as educational facilities like charter schools and private universities. EPR has consistently paid out dividends since going public in 1997 with a current yield around 5%.
Another REIT option is National Health Investors Inc.(NHI), which specializes in senior housing and healthcare properties. NHI has a market cap just under $4 billion and currently yields around 5%. The company has been paying dividends since 1992 and has increased its payout every year for the past decade.
Moving on to the energy sector, we have Holly Energy Partners LP (HEP), a midstream energy company that specializes in transporting petroleum products. HEP pays out an impressive yield of over 9% and has consistently paid dividends since going public in 2004. While the energy sector can be volatile, HEP’s focus on transportation rather than exploration or production makes it less susceptible to fluctuations in oil prices.
Another small-cap option in the energy sector is Valero Energy Partners LP (VLP), a midstream company focused on pipelines and terminals for crude oil and refined petroleum products. VLP offers a current yield around 6% with consistent dividend payouts since its initial public offering in late 2013.
Finally, we have Westwood Holdings Group Inc.(WHG), an investment management firm with a market cap just over $130 million. WHG currently yields around 7%, making it one of the higher-yielding options on this list. The company mainly provides investment advisory services to institutional clients but also manages mutual funds available to retail investors.
Overall, small-cap dividend stocks can offer investors both income potential as well as growth opportunities. However, it is essential to do your own research before investing in any individual stock or group of stocks, especially those that may be more volatile due to their size or industry focus. As always, diversification across different sectors and asset classes is key when building an investment portfolio that meets your personal financial goals.