In the turbulent seas of the stock market, high-yield dividend stocks can potentially act as lifebuoys for investors.
These stalwarts usually provide a comforting revenue stream, ensuring you pocket healthy dividends even if the tides turn and share prices dive. However, investing in stocks boasting payouts above 5% is not without its risks.
Still, if you wager on high-yield dividend stocks, things could get incredibly lucrative over time.
With that said, I’ve used the GuruFocus Screener to identify seven stocks yielding over 5%, with 3-year dividend growth rates per share at more than 20%. Here is what I found.
Rio Tinto (RIO)
Rio Tinto (NYSE:RIO) emerges as a versatile powerhouse offering investors a smorgasbord of materials, spanning from iron, copper, aluminum, assorted minerals, and others.
The firm’s sails are set towards an anticipated upswing in material demand, pushing 5% more products through its channels in the first half of 2023 compared to the prior year. While material prices have ebbed, resulting in a 33% drop in sales, the undercurrents hint at a turnaround.
Significantly, the company’s sharpened focus on the iron ore sector underscored in its earnings report, signals confidence in building demand ahead. More importantly, for investors, the stock implied upside from current levels stands at a juicy 17% coupled with a stellar dividend profile.
Sporting a stellar 6.4% yield, Rio Tinto’s dividends have surged by almost 30% over three years. In the realm of materials, Rio Tinto is one of the high-yield dividend stocks that seems to be striking gold.
Clearway Energy (CWEN)
Despite riding the crest as a top-tier player in clean energy, Clearway Energy (NYSE:CWEN) has been wrestling with market headwinds of late.
Witnessing a drop of more than 23% in the first half of the year, at first glance, the stock seems to be floundering. However, a deeper dive reveals budding prospects on the horizon.
Furthermore, the firm has consistently expanded cash flows and bolstered its distribution. Highlighting its financial prowess, the company raised its payouts for the 12th consecutive quarter in May, reaching 38 cents.
Ambitiously, Clearway projects an annual dividend growth of 5% to 8%. Clearway has a 79% EBITDA and a 68% gross profit margin on a trailing twelve-month basis. Its dividend profile stands tall, offering a 6.1% yield complemented by a robust 21.3% growth over 3 years. That makes it one of the high-yield dividend stocks to keep your eye on.
Bancolombia (CIB)
Navigating the financial currents of Northern South America and Central America, Bancolombia (NYSE:CIB) stands as a beacon of resilience.
Though the stock has had its fair share of difficulties over the past decade, recent tides have favored the Colombian finance titan, pushing it up by 8% in the last six months.
Much of its share price turbulence over the year is linked to its home ground. Colombia and its neighboring countries continue to grapple with political unrest and street protests. However, these headwinds are already baked-in into the current valuation.
Delving beneath the surface, Bancolombia’s financials radiate strength. It outpaces its peers with a year-over-year sales growth of 9.8%, surpassing the sector’s median by 38.5%.
Equally impressive, its net income margin is 31%, leaving the median lagging by 21%. Cash from operations is a robust $3 billion. This is one of those high-yield dividend stocks you don’t want to miss out on.
For dividend enthusiasts, Bancolombia serves as a haven. With an unbroken two-decade-long dividend history, the past three years have seen its payouts grow by an incredible 42%, capped with a generous 9.4% yield.
Postal Realty Trust (PSTL)
Postal Realty Trust (NYSE:PSTL) may not seem like the flashiest contender in the investment universe, but it is arguably one of the best dividend stocks in its niche.
Specializing in leasing properties to the United States Postal Service, this REIT operates within a sector many might overlook. Yet, its position as the only publicly traded REIT focused on this industry places it in a prime position to capitalize on unique opportunities.
The firm’s strategy revolves around making accretive acquisitions of postal properties, serving up a dual benefit, property appreciation, and juicy payouts for its shareholders.
With a glowing average-funds-from-operations payout ratio of 66% over the past year and an EBIT margin of 21.2%, it’s clear that Postal Realty Trust is doing remarkably well financially.
And for those dividend-hungry investors, PSTL is quite the catch. A mouthwatering dividend yield of 6.6% is enhanced further by a staggering 66% dividend growth rate per share across the last three years.
OneMain Holdings (OMF)
In the sprawling landscape of financial lending, OneMain Holdings (NYSE:OMF) has carved out its unique niche, offering a lifeline to those overlooked by mainstream banks.
Born from the financial powerhouse Citigroup, OneMain isn’t just any other specialty lender. It’s a lending institution fortified with rich data and lending insights bolstered by its foray into digital product and distribution avenues.
However, rising concerns about loan repayments, given a gloomier macroeconomic scene, have shade on the stock’s performance. These headwinds will likely be temporary with the company tightening its lending reins and exhibiting positive course corrections.
Trading at a rather attractive 1.1 times forward sales, a whopping 50% below its peers, OneMain promises value. Its consistent dividend growth over the past three years culminates in a tempting yield of 9.6%, making it one of the high-yield dividend stocks to buy now.
ChipMos Technologies (IMOS)
ChipMos Technologies (NASDAQ:IMOS) is a semiconductor business that, beyond powering everyday computing needs, dives deep, offering an extensive range of back-end testing services for liquid crystal display drivers, high-density memory, and mixed-signal semiconductors.
It seamlessly bridges the gap between memory and display with top-notch lead frame and substrate-based assembly services.
Whether it’s the automotive or industrial sectors, the intricate world of medical devices, or the ever-evolving communication landscape, ChipMOS has its imprint everywhere.
Challenging operating conditions have weighed down recent financials.
In its second quarter, the company showcased a GAAP earnings-per-American-depository-share of 56 cents, and the revenue figures, although down year-over-year, surpassed expectations by a solid $7.72 million.
Financial stability is evident, with a free cash flow of $62.6 million in the year’s first half.
It trades at a mere 1.2 times forward sales, yielding a solid 6.3%, with a remarkable three-year payout growth surpassing 50%.
Pangaea Logistics Solutions (PANL)
In the bustling world of maritime transportation, Pangaea Logistics Solutions (NASDAQ:PANL) stands as an intriguing investment.
Though the shipping sector grapples with fluctuating dry bulk rates and heightened geopolitical risks primarily due to the Russia-Ukraine conflict, Pangaea’s unique strategy offers a glimmer of resilience.
This small-cap gem boasts a flexible chartered-in strategy, ensuring full fleet utilization and leveraging long-term contracts to safeguard sales.
With a time-charter-equivalent soaring 49% above the market average in the second quarter, Pangaea’s 25 owned vessels are in top form, and there’s more on the horizon.
A recovering Chinese economy and growing U.S. infrastructure spending signal a bright forecast for Pangaea’s dry bulk operations. Trading at a mere 0.5 times forward sales and offering a hefty 7% yield, Pangaea presents itself as a solid income stock.
On the date of publication, Muslim Farooque 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