Seeking Up to 12% Dividend Yield? Analysts Recommend 2 Dividend Stocks to Buy

As investors continue to navigate volatile markets, high dividend yields remain an attractive feature for income-oriented portfolios. Two dividend stocks, Annaly Capital Management (NLY) and AGNC Investment (AGNC), have caught the attention of analysts due to their high yields and potential for growth. Both stocks have yields above 12%, making them appealing options for investors seeking substantial income.



Annaly Capital Management (NLY) is a mortgage real estate investment trust (REIT) with a current yield of 12.5%. The company invests in mortgage-backed securities (MBSs) and generates income through the spread between the interest it earns on its investments and the interest it pays on its borrowings. As the Federal Reserve begins a rate-easing cycle, NLY is well-positioned to benefit from lower borrowing costs and potentially higher yields on its MBS portfolio. Additionally, NLY's dividend payout ratio of around 90% suggests that the company is distributing a significant portion of its earnings as dividends.

AGNC Investment (AGNC) is another mortgage REIT with an even higher yield of 13.9%. AGNC invests primarily in agency MBSs, which are backed by the U.S. government or a U.S. government-sponsored entity. Like NLY, AGNC is likely to benefit from lower borrowing costs and potentially higher yields on its MBS portfolio as the Fed eases monetary policy. AGNC's dividend payout ratio of approximately 80% indicates that the company is retaining more of its earnings for reinvestment, which can support future dividend growth.



Both NLY and AGNC have faced challenges in recent years due to rising interest rates, which have compressed their net interest margins. However, as the Fed shifts to a dovish monetary policy, these mortgage REITs are well-positioned to outperform and maintain their high dividend yields. Investors seeking up to 12% dividend yields should consider adding NLY and AGNC to their portfolios, as these stocks offer attractive income and potential for growth.

In conclusion, high dividend yields remain an attractive feature for income-oriented portfolios, and investors should consider adding Annaly Capital Management (NLY) and AGNC Investment (AGNC) to their watchlists. Both stocks have yields above 12% and are well-positioned to benefit from the Fed's rate-easing cycle. As always, investors should conduct thorough research and consider their own risk tolerance before making any investment decisions.