Get Yields of 4.9% from These 2 Restaurant Stocks

Did you know that you could earn passive income from some of Canada’s most popular restaurant brands by investing in public entities that own their trademarks? Let’s take a closer look at two that you could buy now.

Pizza Pizza Royalty Corp.

Pizza Pizza Royalty Corp. (TSX:PZA) owns certain trademarks associated with the Pizza Pizza and Pizza 73 brands in Canada. It licenses these properties for use in operating restaurants in exchange for a royalty of 6% of sales at Pizza Pizza restaurants and 9% of sales at Pizza 73 restaurants. As of March 31, there are 751 restaurants in its royalty pool, including 651 Pizza Pizza restaurants and 100 Pizza 73 restaurants.

PPRC pays a monthly dividend of $0.0713 per share, equal to $0.856 per share annually, giving it a 4.9% yield. It’s also important to note that the company’s 2.4% dividend increase in June 2016 has it positioned for 2017 to mark the sixth straight year in which it has raised its annual dividend payment.

Keg Royalties Income Fund

Keg Royalties Income Fund (TSX:KEG.UN) indirectly owns certain trademarks associated with The Keg restaurant brand in North America. It licenses these properties for use in operating restaurants in exchange for a royalty of 4% of sales. As of March 31, there are 100 restaurants in its royalty pool.

The Fund pays a monthly distribution of $0.0918 per unit, equal to $1.1016 per unit annually, giving it a 4.9% yield. Investors should also note that the company’s two distribution increases in 2016, including its 2% increase in August, have it positioned for 2017 to mark the third straight year in which it has raised its annual distribution.