The U.S. stock market is at an uncertain juncture right now. Trade- and government-induced volatility has dragged the Dow Jones Industrial Average and S&P 500 down 3.3% and 3.5% since the start of May. The Nasdaq has had it even worse, falling 5.9% over that same period of time.
Market uncertainty can make people crave steady income-producing investments, and that’s exactly where dividend stocks come into play. Investors don’t necessarily buy these companies for their explosive profit potential – they instead buy them because they offer stable, passive income during unstable times.
The best place to start is by searching for stocks with a high dividend yield, which is the ratio of a company’s dividend compared to the share price. These stocks are often beaten down, but the low share price only means investors can get the most bang for their buck in the form of dividend payments. High yielders are a prime component of any well-rounded portfolio, and serious investors should consider buying them now while most of the market trades at a discount.
Here are five of the highest-yielding companies on the stock market, with dividend yields measured as of the closing bell on Thursday, June 6…
No. 5: Pacific Coast Oil Trust (ROYT)
Pacific Coast is a California-based firm that produces and sells oil to refineries across the state. It owns several high-volume properties, including Orcutt properties in the Santa Maria Basin, as well as the West Pico, East Coyote, and Sawtelle properties in the Los Angeles Basin. As of the end of last year, Pacific Oil had proven reserves of 19.0 million barrels of oil equivalent.
ROYT provides a yearly dividend of $0.37 per share against the current share price of $2.04, giving the stock a yield of 18.35%. For comparison, that’s nearly 10 times the tiny 1.9% average dividend yield across all S&P 500 stocks.
No. 4: Arlington Asset Investment Corp. (AI)
As is the case with many high-yield stocks, they lack the bells and whistles typical of the more tantalizing sectors like technology. High yielders are often boring in every area of their business besides the generous levels of passive income they distribute to shareholders. Arlington perfectly fits the bill – it’s an investment firm that buys and holds mortgage-related assets like real estate. The firm is classified as a real estate investment trust (REIT), allowing it to reap special tax breaks from the government and subsequently redistribute the extra money from those breaks in the form of dividends.
With an annual payout of $1.50 per share against a share price of $6.75, AI stock currently boasts a yield of 22.2%. That makes it one of the highest-yielding mortgage-related REITs on the entire stock market right now.
No. 3: Washington Prime Group Inc. (WPG)
Washington Prime Group is another REIT, but this one operates in the highly leveraged retail sector. The firm specifically invests in shopping centers across the U.S., including 14 properties in Florida alone. While the retail apocalypse continues to push retailers out of these locations, there’s no denying the inherent property value of these large shopping centers situated near highly populated areas. The value of all U.S. retail space – including shopping centers and shopping malls – totals about $2.1 trillion, or roughly 36% of the total value of all U.S. commercial real estate.
Shares of WPG currently price at $3.99 and offer a yearly payout of $1, making for a generous dividend yield of 25.1%.
No. 2: Foresight Energy LP (FELP)
Foresight is a coal miner and producer that sells coal to utility companies across the eastern United States. The company primarily conducts longwall mining, which is when an underground wall of coal is mined in a single slice or panel. Its main properties include two mining complexes with three longwall mining systems in West Virginia’s Williamson field and Illinois’s Sugar Camp. According to recent financials, Foresight controls about 2 billion tons of coal reserves in the Illinois Basin alone.
FELP just closed at $0.76 per share with an annual dividend of $0.24. That gives the stock an incredible dividend yield of 31.6%.
No. 1: Consolidated Communications Holdings Inc. (CNSL) The top income play on the list is Consolidated Communications, an Illinois-based telecom firm that provides a range of Internet and phone services. Last year, Consolidated said it operates roughly 36,000 miles of fiber-optics routes throughout 23 states, making it one of the top 10 leading broadband providers in the country. The firm also boasts dominance in other telecom service areas; it reported approximately 902 thousand voice connections, 779 thousand data connections, and 93 thousand video connections