3 High-Yield Dividend Stocks Poised for Growth Amid Market Volatility

As markets oscillate between optimism and caution, income-seeking investors are turning to dividend-paying stocks for stability and growth. Today, we spotlight three undervalued high-yield champions—Dominion Energy (NYSE: D), Western Midstream Partners (NYSE: WES), and Chevron (NYSE: CVX)—each offering robust yields, fortress-like balance sheets, and catalysts to fuel future growth. These stocks aren't just safe havens; they're engines of passive income in an uncertain world.

Dominion Energy (D): A Utility Giant Rebuilding for Growth

With a dividend yield of 4.9%, Dominion Energy stands out in the conservative utility sector, where average yields hover around 2.9%. While its payout ratio remains elevated as the company transitions into a pure-play electric utility, management has a clear plan: reduce leverage, simplify operations, and resume dividend growth by 2026–2027.

Why It's Undervalued:
Dominion's debt-to-equity ratio has fallen to 1.94 (from 3.31 in 2017) after offloading non-core assets like pipelines and natural gas operations. This deleveraging, paired with a BBB+ credit rating, positions it to capitalize on infrastructure investments. The company is pouring $3.6–$4.0 billion annually into grid modernization and renewable projects, driving 5–7% earnings growth in its core regulated markets.

Catalyst to Watch:
The completion of its $1.2 billion Dominion Energy Advanced Clean Energy Park in Virginia by 2027 will solidify its leadership in clean energy, while regulatory approvals for rate hikes in North Carolina and South Carolina ensure steady cash flows.

Western Midstream Partners (WES): A 9.5% Yield with Bulletproof Cash Flows

Western Midstream's 9.5% dividend yield is a rarity in any sector, let alone energy. Backed by $1.3–$1.5 billion in annual free cash flow, its payout ratio is comfortably covered, even as it invests in high-return midstream projects.

Balance Sheet Fortitude:
With a debt-to-equity ratio below 3.0x (well under its 3.0x target), WES has the flexibility to acquire assets and expand its footprint. Its focus on fee-based contracts with majors like Occidental Petroleum shields it from commodity price swings.

Growth on the Horizon:
The partnership with Occidental to develop the West Delta 32 platform in the Gulf of Mexico and its recent $500 million acquisition of Permian Basin midstream assets will boost distributable cash flow by low-to-mid single digits annually.

Note: WES's K-1 tax forms require careful handling, making it ideal for tax-advantaged accounts like IRAs.

Chevron (CVX): A 5% Yield Anchored by Oil Resilience

Chevron's 5% dividend yield reflects its 38-year streak of annual hikes, a testament to its financial discipline. Despite a 20% stock dip in late 2024 due to oil price volatility, its 40% payout ratio remains comfortably covered by free cash flow.

Why It's a Buy Now:
Chevron's A- credit rating and debt-to-equity ratio of 0.16 (among the lowest in its sector) give it a critical edge. With oil prices stabilized near $70/barrel, Chevron is poised to generate $9 billion in incremental free cash flow by 2026, funding both dividends and its $15 billion share buyback program.

Catalyst to Watch:
The pending $2.4 billion acquisition of Hess will add 2 billion barrels of oil equivalent in Guyana's Stabroek Block, a world-class asset with production costs as low as $15/barrel. This deal alone could lift Chevron's reserves by 10%, ensuring dividend sustainability for decades.

Why These Stocks Excel in Volatile Markets

1. Dividend Safety: All three have payout ratios well within safe ranges and balance sheets strengthened by deleveraging or conservative borrowing.
2. Valuation Discounts: Dominion trades at 10x forward earnings (vs. its 5-year average of 14x), WES at 8x, and Chevron at 9x, all below historical norms.
3. Sector Catalysts: Utilities benefit from rising infrastructure spending, midstream plays thrive on energy demand, and Chevron's oil exposure is hedged by long-term contracts and cost discipline.

Final Call to Action

For income investors, Dominion Energy, Western Midstream, and Chevron are rare gems: high-yield stocks with proven dividend safety, balance sheets that can weather storms, and growth trajectories that ignore market noise.

• Dominion Energy (D): Buy for 5–7% earnings growth and a resumed dividend hike by 2027.
• Western Midstream (WES): Ideal for tax-advantaged accounts seeking 9.5% yields and acquisition-driven growth.
• Chevron (CVX): A 5% yield with $9 billion in free cash flow growth and a fortress balance sheet.

The market's next downturn could be your entry point—act now to lock in these yields before the next rally.