In the fast-paced world of investing, high-yield dividend stocks are becoming a beacon for those craving both stability and robust returns. Amid a financial landscape punctuated by unpredictable layoffs and persistent inflation, these dividend giants offer a silver lining.
Basically, their capacity to provide consistent passive income positions them distinctly in an investor’s portfolio. But like every treasure hunt, this one requires discernment. While tempting yields beckon, not all generous passive-income providers are created equal.
Navigate the intricacies and rewards of these analyst-backed high-yield dividend stocks and give your portfolio the boost it deserves.
VAALCO Energy (EGY)
Based in Houston, Texas, VAALCO Energy (NYSE:EGY) specializes in hydrocarbon exploration. Sure, the industry itself incurs questions given the increasing focus on clean and renewable energy sources. However, geopolitical forces again reared their ugly head, leading to by major producers. Thus, by pure cynicism, EGY deserves some consideration for high-yield dividend stocks.
Now, part of the challenge associated with Vaalco is that it hasn’t performed as well as many of its peers. Still, the red ink may offer an . For example, EGY trades at a price/earnings-to-growth (PEG) ratio of 0.36x. In contrast, the sector median comes in at 0.82x. Also, it’s worth pointing out that at the end of August, .
Regarding passive income, TipRanks points out that Vaalco offers a . That’s noticeably higher than the energy sector’s average yield of 3.75%. Just as well, with a $8.30 price target, implying 113% upside.
Genesis Energy (GEL)
Also based in Houston, Genesis Energy (NYSE:GEL) is a world-class midstream services provider. In contrast to the upstream (exploration and production) component, midstream players primarily focus on the storage and transportation of energy commodities. While GEL offers many advantages as one of the high-yield dividend stocks, it’s also a master limited partnership (MLP). Thus, it’s subject to more complex .
Unlike many other energy-related enterprises, Genesis just hasn’t performed remarkably well in the charts this year. And to be quite blunt, you’re also taking a risk financially. Its balance sheet isn’t the most confidence-inspiring. Further, it could use some work in the long-term revenue growth department. That said, some speculators will appreciate that in August, a .
Heading over to passive income, Genesis offers a . It’s been growing its payout since 2020. Lastly, RBC Capital’s Elvira Scotto pegs GEL a buy with a , implying over 31% growth.
Gaming and Leisure (GLPI)
While the energy sector offers some of the most tempting high-yield dividend stocks, investors can look elsewhere for robust passive income. Case in point is Gaming and Leisure (NASDAQ:GLPI), a real estate investment trust (REIT) specializing in casino properties. Fundamentally, Gaming provides an enticing backdrop because of the revenge travel phenomenon. While removed from the worst of the crisis, people are still exercising away their cabin fever.
Cynically, Gaming could provide a cheaper form of entertainment. Yes, I’m sure we’d all love to take that exotic vacation to someplace halfway around the world. But domestic casinos and resorts facilitate much bang for the buck. Plus, circumstances such as mass layoffs may inspire folks to vacation responsibly.
If so, GLPI could rank among the high-yield dividend stocks to buy. It’s consistently profitable and many investors will appreciate the that have been occurring since March of this year. Notably, GLPI runs a . It also benefits from a consensus with a $54.21 target, implying 19% upside.
Apple Hospitality (APLE)
Another REIT, Apple Hospitality (NYSE:APLE) focuses on upscale, rooms-focused hotels in the U.S. , Apple’s portfolio consists of 220 hotels with more than 28,900 guest rooms located in 87 markets throughout 37 states. Chart-wise, APLE has been disappointing since the start of this year, if we’re going to be honest. Still, if you’re a believer in travel sentiment, Apple could be intriguing.
Admittedly, retailers have been reporting for several weeks that
. However, it’s also clear that people are still prioritizing experiences. Listen, if young music fans are finding ways to fork over hundreds if not thousands of dollars to see Taylor Swift live, revenge travel may still be going strong.
If so, APLE could be one of the high-yield dividend stocks to buy. Don’t take it from me. Rather, the . Plus, its is mighty tempting. And yes, analysts give the nod to APLE, targeting $18 or nearly 20% up.
KeyCorp (KEY)
In an effort to diversify the names on this list of high-yield dividend stocks, I’m going to include KeyCorp (NYSE:KEY). A financial institution, KeyCorp has suffered badly amid the regional banking crisis. Since stumbling sharply in early March of this year, KEY stock has yet to recover from the malaise. Those betting on it will be taking a shot in the dark.
Financially, one area that’s not sitting well with me is the . In the second quarter, KeyCorp posted $978 million, down conspicuously from the $1.1 billion in the year-ago quarter. Cynically, in part, because interest rates skyrocketed, this metric should be experiencing growth, as is the case with other banks.
Still, I’m going to give credit where it’s due. In August, an insider bought a significant number of shares. Also, people looking for robust passive income may find it difficult to ignore KeyCorp’s . In closing, analysts rate KEY a with a $13.25 target, implying about 30% upside.
FAT Brands (FAT)
A multi-brand restaurant operator, FAT Brands (NASDAQ:FAT) is best known for its . As well, it owns Round Table Pizza and Johnny Rockets. As a fast food or fast-casual operator, Fat Brands should largely benefit from the trade-down effect; that is, consumers may trade down from pricey restaurants to more affordable alternatives.
In fairness, Fat Brands is also liable to become a victim of the tradedown. Honestly, if circumstances get truly awful, consumers can elect to stop eating out altogether, instead electing to cook at home. However, based on the latest hotter-than-expected , that magnitude of abstinence may not be on the books just quite yet.
Now, in the spirit of full disclosure, FAT doesn’t enjoy the most sterling financials. For example, its balance sheet leaves much to be desired. Still, since May of this year. It also sports an . Lastly, analysts peg FAT as a with a $20 target, implying 209% growth.
Hannon Armstrong (HASI)
Closing out this discussion of high-yield dividend stocks with a mortgage REIT, Hannon Armstrong (NYSE:HASI) delivers a distinct market opportunity. Primarily, the trust focuses on . Per Motley Fool, Hannon generates cash flow through these assets, which are typically backed by long-term power agreements. Moreover, the relevance of the underlying industry provides HASI with a likely long runway.
Now, it’s imperative that I mention how risky the enterprise is. Just in the week ended Oct. 6, HASI fell more than 31%. That’s alarming no matter what the circumstances. Still, I suppose you can make the argument that HASI is priced more attractively, given its .
As for the positives, insiders gobbled up HASI stock in August. That’s a great sign because it appears they’re unfazed by the volatility. Also, HASI offers a . Considering the passive income, the payout ratio isn’t all that bad at 77.23%. Finally, analysts peg HASI as a with a $35.67 target, implying over 147% upside.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
