As high inflation continues to take a toll on the purchasing power of Canadian consumers, dividend stocks could offer some relief. Dividend stocks usually provide a steady stream of income that could help offset the rising cost of living and also boost your long-term returns. Moreover, if you invest in dividend stocks that pay monthly, you can enjoy a more regular cash flow and reinvest your dividends more frequently.

In this article, I’ll talk about three of the best TSX dividend stocks that pay monthly and have strong fundamentals to support their payouts.

Paramount Resources stock

Paramount Resources (TSX:POU) is a Calgary-based energy company with a market cap of $4.3 billion and a strong portfolio of long-term petroleum and natural gas assets in Canada. Its stock currently trades at $29.41 per share after rallying by 207% in the last three years. At the current market price, this monthly dividend stock offers a decent 5.1% annualized dividend yield.

Despite a weakness in the prices of energy products in 2023, Paramount’s total revenue in the last five years has gone up by 72%, which has helped its adjusted annual earnings jump 214%. Given the strong well performance in the Grande Prairie and Kaybob regions, the energy firm’s production is likely to increase gradually in the coming years, which should help it maintain robust, healthy cash flows and drive its share prices even higher.

Sienna Senior Living stock

Sienna Senior Living (TSX:SIA) is another fundamentally strong monthly-paying dividend stock in Canada you can buy on the Toronto Stock Exchange now. This Markham-based company provides a variety of assisted and independent living options to seniors across Canada. It currently has a market cap of $956.5 million as its stock trades at $13.03 per share after surging by nearly 19% in the last year. SIA stock has an attractive 7.2% annualized dividend yield at the current market price and distributes these payouts every month.

Last year, Sienna’s financial growth trends improved, with its same property net operating income rising by 16.5% YoY (year over year) and adjusted funds from operations growing by around 2.5% YoY. As the average occupancy at its long-term-care communities remains solid, the company’s financials could witness further improvement in the years to come and help its share prices trade on a firm note.

Chartwell Retirement Residences stock

As the demand for seniors’ living options is likely to surge at a fast pace over the next two decades, I expect the shares of companies in this domain to benefit significantly from this trend. Given that, Chartwell Retirement Residences (TSX:CSH.UN) could be another attractive dividend stock to buy now. Like Sienna, Chartwell also offers a range of services to cater to the diverse needs of its senior residents. It currently has a market cap of $3.1 billion as its stock trades at $12.63 per share after rallying by more than 48% in the last year. It has a 4.8% annualized yield at this market price.

Last year, Chartwell’s funds from continuing operations jumped by roughly 20% YoY to $122.2 million due mainly to higher adjusted net operating income and stronger management fee revenue. Moreover, the company has been investing in enhancing its portfolio quality and improving its operational efficiency, which could fuel its business growth over the long term and help it increase dividends.