The Middle East's Highest-Yielding Dividend Stocks for May 2025 – And the Risks to Watch

The Middle East’s equity markets have long been synonymous with oil-driven economies, but a quieter revolution is underway: a wave of dividend-paying stocks offering investors compelling yields amid shifting regional priorities. From Saudi Arabia’s tech-focused Vision 2030 to Dubai’s real estate boom, the region’s companies are increasingly prioritizing shareholder returns. Yet, with geopolitical risks and oil price volatility lingering, discernment is critical. Here’s what to watch in May 2025.

Top Dividend Plays: Yield vs. Sustainability

The Middle East’s dividend landscape is a mix of high returns and uneven fundamentals. Here are the standouts:

1. Saudi Telecom Company (SASE:7010) – 9.22% Yield

The region’s highest-yielding stock, Saudi Telecom, is a telecom titan benefiting from Saudi Arabia’s digital transformation. Its payout ratio remains below 100%, suggesting dividends are earnings-backed. However, investors should monitor its exposure to the kingdom’s broader economic shifts.

Why it’s risky: Telecom infrastructure projects could strain margins if demand lags.

2. Emaar Properties PJSC (DFM:EMAAR) – 8.3–8.66% Yield

Dubai’s real estate giant is riding the post-Expo 2020 boom. First-quarter sales surged 30% year-over-year to AED142.7 billion, underpinning its dividend sustainability. Yet, the real estate market’s reliance on tourism and corporate investment could waver if regional economic growth slows.

Why it’s a buy: Strong sales momentum and a strategic focus on mixed-use developments.

3. National Bank of Ras Al-Khaimah (ADX:RAKBANK) – 8.08% Yield

This UAE-based bank offers a solid yield with a “reasonable” payout ratio. However, its 3.5% non-performing loan ratio hints at credit risks in smaller emirates.

Why it’s tricky: Profitability hinges on UAE’s broader economic health.

The High-Risk, High-Yield Club

Some stocks promise sky-high yields but come with significant caveats:

Computer Direct Group Ltd. (TASE:CMDR) – 9.73% Yield

An Israeli IT services firm with a payout ratio exceeding 150%, CMDR’s dividends are funded by cash flow rather than earnings. This makes it a speculative bet on its ability to maintain cash generation amid rising tech competition.

Why it’s risky: Overleveraged and prone to volatility in tech demand cycles.

National Bank of Umm Al-Qaiwain (ADX:NBQ) – 8.33% Yield

A UAE bank with a weak balance sheet (58% coverage ratio for bad loans) and exposure to smaller emirates’ fiscal challenges. A “high-reward, high-risk” play for contrarian investors.

Sustainable Dividend Stars

For investors prioritizing stability:

Qatar National Bank (QNB) – 5% Yield

Backed by Qatar’s energy wealth and infrastructure spending, QNB offers a 5% yield with a low payout ratio. While not the highest yield, it’s a defensive pick in a volatile region.

Yapi ve Kredi Bankasi (IBSE:YKBNK) – 4.9% Yield

A Turkish banking stalwart with a 24.5% payout ratio, ensuring dividends are comfortably covered. However, its 3% non-performing loan ratio requires monitoring.

Key Risks to Monitor

• Oil Prices: Falling crude prices could pressure energy-linked stocks and Gulf economies.
• Geopolitical Tensions: Regional conflicts or sanctions could disrupt corporate earnings.
• Payout Ratios: Stocks with ratios over 100% (e.g., Computer Direct Group) risk dividend cuts if earnings falter.

Conclusion: The Best Bets for May 2025

Investors should prioritize Saudi Telecom Company (9.22%) and Emaar Properties (8.3%) for their combination of high yield and earnings-backed dividends. For stability, Qatar National Bank (5%) and Akmerkez Gayrimenkul (6.1%) offer sustainable payouts. High-risk options like Computer Direct Group (9.73%) demand close scrutiny of cash flow trends and sector-specific risks.

The data underscores a critical takeaway: yield is not enough. A payout ratio under 100%, robust cash flows, and exposure to resilient sectors like real estate or banking—rather than oil—are the true markers of sustainable income. With oil prices hovering around $70 per barrel and regional GDP growth expected to slow to 2.5% in 2025, investors must balance ambition with caution.

Final word? Focus on the fundamentals. The Middle East’s dividend story is real—but only for those who dig deeper.