Investors love high-yield dividend stocks, especially the blue chip variety, because they offer a significant income stream and have massive total return potential. ...

UPS is turning the corner, but uncertainties remain in the new year.High-yield dividend stocks are an excellent means of participating in the stock market while generating passive income. But even the highest-yielding stock in the S&P 500 -- LyondellBasell Industries (yielding 12.6%) -- couldn't keep up with recent S&P 500 gains on dividends alone. At the time of this writing, the index is up 16.6% year to date after gaining more than 20% in both 2023 and 2024.The best reason to buy high-yield dividend sto ...

Interest rate cuts make high-yield dividend stocks more attractive by reducing competition from fixed-income investments and lowering companies' borrowing costs, thereby supporting both dividend sustainability and stock price appreciation. ...

Core Viewpoint - The energy sector offers high dividend yields, with sustainable payouts exceeding 7% from quality companies, particularly pipeline companies structured as master limited partnerships (MLPs) [1]. Group 1: Enterprise Products Partners - Enterprise Products Partners (EPD) has a dividend yield of 7.1% and is recognized as one of the best-managed MLPs [2]. - The company charges fees for the transportation and storage of crude oil, natural gas, and refined products, generating significant cash flow [3]. - Over the past decade, Enterprise has increased its operational cash flow by more than 90% and is currently completing major expansion projects, including the 550-mile Bahia Pipeline [5][6]. Group 2: MPLX - MPLX offers a higher dividend yield of 7.4% and is similarly well-managed, with a strong capacity to cover its payouts [7]. - The company has ongoing construction of natural gas pipelines, including the Eiger Express pipeline with a capacity of 2.5 billion cubic feet per day, and has made significant acquisitions, such as a $2.4 billion sour gas treatment business [9].

Group 1 - The Invesco High Yield Equity Dividend Achievers ETF (NASDAQ: PEY) is designed for long-term investors seeking to invest in often overlooked dividend stocks while also allowing for opportunistic investments [1][2] - This ETF tracks the Nasdaq US Dividend Achievers 50 Index, which includes stocks that have increased dividends for at least 10 consecutive years, excluding real estate investment trusts and limited partnerships [2][3] - The index weights its holdings by yield rather than market capitalization, meaning that higher-yielding stocks have a greater impact on performance, which may lead to a focus on out-of-favor stocks [4] Group 2 - The ETF's portfolio is primarily composed of utility and financial stocks, sectors known for higher yields, which can enhance diversification for investors [6] - The index rebalances quarterly and undergoes an annual complete revamp, helping to mitigate risks associated with holding high-yield and out-of-favor stocks [5]

Group 1 - The article discusses the preference for reliable, sustainable income over high-risk trades, highlighting that not all investors share the same risk appetite [1] - It emphasizes the availability of tools like Barchart's Stock Screener to identify high-yield dividend stocks without relying on unverified sources [2] - The author outlines a systematic approach to screening for high-yield dividend stocks, focusing on specific filters to ensure safety and security [3] Group 2 - The screening criteria include a current analyst rating ranging from 3.5 (Moderate Buy) to 5 (Strong Buy), indicating positive expectations for stock performance over the next 12 months [4] - The market capitalization filter is set to a minimum of $3 billion, targeting mid-cap stocks and larger for greater stability and liquidity [4] - The dividend payout ratio is capped at 100%, allowing for the inclusion of REITs and BDCs, which typically distribute a significant portion of their earnings as dividends [4] - The annual forward dividend yield is set to a minimum of 10%, ensuring that only top dividend payers are considered [4]

Core Viewpoint - Investors are particularly attracted to dividend stocks, especially those with high yields, due to their ability to provide a significant income stream and substantial total return potential [1] Group 1 - Dividend stocks are favored by investors for their income generation capabilities [1] - High-yield dividend stocks are noted for their potential to deliver substantial total returns [1]

Core Viewpoint - Investing in high-yielding dividend stocks, particularly Realty Income, is an effective strategy for generating passive income due to its strong financial profile and consistent dividend growth [1][14]. Company Overview - Realty Income is a real estate investment trust (REIT) that offers a high-yielding dividend, currently exceeding 5.5%, significantly higher than the S&P 500's yield of less than 1.5% [4]. - The REIT has a robust financial foundation, supported by a diverse portfolio of over 15,600 rental properties across various sectors, including retail, industrial, and gaming [5][12]. Financial Performance - Realty Income generates approximately 91% of its rental income from industries that are resilient to economic downturns, ensuring stable cash flow [6]. - The company has maintained a conservative payout ratio of about 75% of its adjusted funds from operations (FFO), allowing it to retain nearly $1 billion in excess free cash annually for further investments [7]. Dividend History - Realty Income has a remarkable track record of dividend payments, having declared 660 consecutive monthly dividends since its public listing in 1994, with no suspensions or reductions [9]. - The REIT has increased its dividend payment 131 times since going public, achieving 30 consecutive years of dividend growth at a compound annual growth rate of 4.2% [11]. Growth Potential - Realty Income has expanded its total addressable market (TAM) to $14 trillion by diversifying into various property types, including industrial and gaming, and is targeting $4 billion in acquisitions this year [12][13]. - The company is also developing a credit investment platform and a U.S. private capital fund, which will further enhance its growth opportunities [13].

Core Insights - High-yield dividend stocks can provide attractive income but often come with higher risk profiles [1] - Enbridge is highlighted as a more reliable option for dividend income compared to Ford and UPS, which face uncertainties [2][11] Enbridge - Enbridge operates a diversified energy infrastructure platform with stable utility and pipeline operations, generating 98% of its cash flow from cost-of-service or contracted frameworks [4] - The company has maintained its annual financial guidance for 19 consecutive years, demonstrating resilience through economic downturns [4] - Enbridge pays out 60% to 70% of its stable cash flow in dividends and has a strong investment-grade balance sheet, allowing for significant annual investment capacity [5] - The company has a multibillion-dollar backlog of expansion projects and expects to grow cash flow per share at a rate of 3% to 5% annually, supporting continued dividend increases [5] Ford - Ford has a history of inconsistent dividend payments, having suspended its dividend twice in the past due to adverse market conditions [7] - The company aims to return 40% to 50% of its adjusted free cash flow to investors, but its cash flow is projected to decline from $6.7 billion to between $3.5 billion and $4.5 billion this year [8] - Analysts predict that Ford may cut its dividend to $0.12 per share as early as the next quarter due to its uncertain financial outlook [9] UPS - UPS has a strong track record of maintaining or increasing dividends since going public in 1999, emphasizing its commitment to dividend payments [10] - However, UPS's free cash flow has decreased from $2.3 billion to $1.5 billion year-over-year, raising concerns about its ability to sustain its nearly $1.4 billion dividend outlay [10] - The loss of business with Amazon to FedEx has further pressured UPS's margins and earnings growth, making it a riskier option for income-focused investors [10]