3 Dividend Stocks Offering Yields As High As 7.8%

As the market continues to navigate volatile conditions, investors are seeking stable and high-yielding dividend stocks to add to their portfolios. While the S&P 500 index has experienced a challenging year, certain sectors have shown resilience, and healthcare is one of them. In this article, we will explore three dividend stocks offering yields as high as 7.8%, providing investors with a combination of income and growth potential.



1. Altria Group (MO)
Altria Group, a tobacco company with a long history of dividend growth, currently offers a yield of 7.8%. The company's dividend payout ratio of 66.9% indicates that the dividend is sustainable, given its strong cash flow and earnings growth prospects. Altria's expansion into oral tobacco and nicotine pouches has shown promise, providing a stable and growing cash flow source. The company's shares are valued at less than 9 times forecast EPS in 2025, making it an attractive investment for income seekers.



2. Verizon Communications (VZ)
Verizon Communications, a telecommunications company, offers a high yield of 6.78%. The company's dividend payout ratio of 115% may raise concerns about the sustainability of the dividend, but its improving cash flow and network spending trends suggest that the dividend may be more secure than the payout ratio implies. Verizon's free cash flow has surged over the past 36 months, indicating the stability and growth of its cash flow sources. The company's 18-year streak of dividend increases demonstrates its commitment to shareholders.



3. Pfizer (PFE)
Pfizer, a pharmaceutical company, offers a yield of 6.72%. The company's dividend payout ratio is around 50%, indicating a comfortable level of sustainability for its dividend. Pfizer's acquisition of Seagen in December 2023 has expanded its product portfolio and oncology pipeline, driving future earnings growth. The company's shares are valued at less than 9 times forecast EPS in 2025, making it an attractive investment for income seekers.

In conclusion, Altria Group, Verizon Communications, and Pfizer offer high-yielding dividends with varying degrees of sustainability. While Altria's and Pfizer's dividend payout ratios suggest a high degree of sustainability, Verizon's improving cash flow and network spending trends indicate that its dividend may be more secure than its payout ratio implies. Investors seeking stable and high-yielding dividend stocks should consider these three companies, as they offer a combination of income and growth potential in the healthcare sector.