The Tax-Free Financial savings Account (TFSA) means that you can purchase and maintain certified investments and profit from tax-free returns for all times. These investments embrace shares, bonds, mutual funds, exchange-traded funds, and extra.

TFSA holders ought to take into account gaining publicity to high quality dividend shares and profit from a gradual stream of passive revenue in addition to long-term capital positive aspects. On this article, I’ve recognized a high-dividend inventory with a month-to-month payout that you could take into account proudly owning in September 2025.

So, let’s see how a $25,000 TFSA funding on this dividend inventory may aid you earn $190 in month-to-month revenue.

Is that this TSX dividend inventory a great purchase on your TFSA?

Valued at a market cap of $630 million, Timbercreek Monetary (TSX:TF) gives shorter-duration structured financing options to Canadian industrial actual property buyers. It focuses on lending in opposition to income-producing actual property properties, akin to multi-residential, retail, and workplace properties, primarily in city markets.

Timbercreek Monetary delivered stable second-quarter (Q2) outcomes with distributable revenue of $0.18 per share. Given a quarterly dividend of $0.174 per share, the corporate has a payout ratio exceeding 90%, leading to a yield of 9.2%.

The industrial actual property lender has demonstrated resilience regardless of ongoing macro uncertainties, with the portfolio rising 11% 12 months over 12 months to $1.1 billion.

Notably, Timbercreek has made progress in resolving “downside loans,” clearing practically $83 million in Stage 2 and Stage 3 belongings because the earlier earnings name.

This portfolio cleanup gives capital for brand new investments whereas decreasing focus danger. Administration expects continued progress on remaining staged loans by way of year-end, with a number of belongings shifting towards decision by way of entitlement approvals and lively gross sales processes.

Timbercreek’s strategic deal with multifamily residential actual property, comprising 55% of the portfolio, gives a defensive moat throughout financial uncertainty. The corporate maintains disciplined underwriting with a 66% weighted common loan-to-value ratio and advantages from fee flooring on 87% of floating-rate loans, defending revenue throughout fee cuts.

The pending credit score facility renewal represents a key catalyst, that includes substantial upsize and improved margin phrases that can assist development towards the $1.3 billion portfolio goal by year-end. This enhanced capability, mixed with Canada Mortgage and Housing Company-approved lender standing, positions Timbercreek advantageously within the bridge and building lending market.

Nonetheless, challenges tied to tariff insurance policies have created transaction delays and borrower uncertainty. The weighted common rate of interest declined to eight.6% from 9.8% 12 months over 12 months, because the Financial institution of Canada’s fee cuts took impact. Nonetheless, administration expects to keep up ample spreads above funding prices.

Analysts monitoring the TSX dividend inventory forecast adjusted earnings to increase from $0.56 per share in 2024 to $0.72 per share in 2026. Bay Road stays bullish and forecasts Timbercreek inventory to realize 7.3%, given consensus worth targets. If we modify for dividends, cumulative returns might be greater than 16%.

At present buying and selling ranges, the TSX inventory trades at a 16% low cost to e-book worth whereas providing a considerable yield premium over bonds.

The Silly takeaway

For income-focused buyers in search of publicity to Canadian industrial actual property with cycle-tested administration, Timbercreek presents compelling worth regardless of near-term headwinds from coverage uncertainty and fee normalization pressures.

A $25,000 funding in Timbercreek inventory would aid you purchase 3,276 shares of the corporate. Given its month-to-month dividend of $0.058 per share, buyers will earn $190 in month-to-month dividends or $2,280 yearly.

Canadian TFSA holders ought to establish different such high quality dividend payers and diversify their portfolio, which lowers general danger.