Passive Income Lovers: 3 Ultra-High Yielding Dividend Stocks To Buy Now

By Omor Ibne Ehsan Published Mar 20, 10:38AM EDT

Key Points

Investors are turning to dividend stocks to anchor their portfolios as uncertainty increases.
And these ultra-yield dividend stocks are solid in that department.
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Market uncertainty and volatility have knocked down most growth bets. Investors are now looking for dividend stocks in anticipation of escalating trade wars. Treasury yields have peaked out and have retreated a little in the past few months, and if this trend continues, dividend stocks are going to become even more popular as the hunger for yield kicks in.

UMich’s recent projection shows inflation at 4.9% a year out. This contrasts sharply with the Federal Reserve’s expectations of 3.1%. If the Fed ends up lowering rates, especially with pressure from the Trump administration, and the higher inflation projection becomes a reality, investors will have nowhere but dividend stocks to turn to for yield.

This can be a good opportunity to grab some ultra-high-yielding dividend stocks before such a scenario. The pendulum may have started to swing the other way, and investors will rotate more of their gains into these dividend stocks if rates go down sharply.

Civitas Resources (CIVI)

Civitas Resources (NYSE:CIVI | CIVI Price Prediction) is an energy production company. It is a carbon-neutral oil and gas producer that can benefit significantly from the Trump administration while being a good pick for ESG investors. It also pays solid dividends.

The stock was one of the best-performing names in the post-COVID era, and it also benefited from the shake-up in the energy industry that happened after February 2022. However, the stock started trending down in late 2023 after it focused more on acquisition and expansion instead of shareholder-friendliness. It also took on a lot of debt.

That said, it still maintains solid buybacks and has a dividend yield of 11.59%. The previous acquisitions have caused the company’s top-line growth to trend up significantly, and the 3-year revenue growth rate sits at 28.6% annually.

Moreover, the 3-year EBITDA growth rate is at 40.2%, and the company’s 3-year dividend growth rate is at 62.3%. All these metrics are significantly above industry averages.

Analysts think that the stock could bottom out soon due to the Trump administration being friendly to oil exploration companies and its growth investments starting to pay off. Both EPS and revenue are expected to decline this year before making a recovery starting next year.

The consensus price target of $67.17 implies a 93.26% upside.

Western Union (WU)

Western Union (NYSE:WU) has been an even bigger laggard in the stock market, but it has been basically flat this year. It’s hard to see the stock trade lower than the $10 floor since you’re paying just 6 times forward earnings at current prices.

This is a good rebound play, and you can sit on its 8.9% dividend yield as it recovers. The company’s woes are mostly due to a decline in its core business as it struggles to compete with more cutting-edge fintech competitors. This has led to revenue declining continuously since 2019. The only year when it did grow was in 2021, mostly due to the ultra-loose stimulus back then.

Nonetheless, the company has managed to keep its bottom line somewhat intact and has kept on paying dividends while doing routine buybacks. The 3-year buyback ratio is at 5%. And given the cash flow, it should be able to keep paying dividends comfortably.

Analysts expect EPS to finally start growing again starting this year. They expect revenue to decline by 1.29% this year, but it is expected to grow and accelerate starting next year. Western Union itself expects 1% adjusted revenue growth this year. If the company plays its cards right, its digital operations could boost growth significantly in the long run. It is shifting its revenue mix to do just that, but declining legacy operations have masked the solid growth in its Branded Digital segment. That segment reported 8% adjusted revenue growth in Q4.

Once Western Union’s top-line decline reverses, analysts should be much more comfortable paying more for WU stock.

Western Midstream Partners LP (WES)

Western Midstream Partners LP (NYSE:WES) didn’t end the previous decade on a positive note, but the 2020s have been solid. The stock is up 698.48% in the past five years.

As the name suggests, this is a master limited partnership that operates midstream energy assets. Midstream companies are some of the most consistent since they are not exposed to the energy market’s ups and downs. That stability translates into the stock too. It did miss Q4 2024 estimates, but analysts are still optimistic due to it exceeding guidance.

Full-year 2024 adjusted EBITDA of $2.344 billion was above the midpoint of its $2.2-2.4 billion guidance range. The company also surpassed the high end of its $1.05-1.25 billion free cash flow guidance. On top of that, the 2025 outlook is very positive. EBITDA is expected to come in between $2.35-2.55 billion, with FCF between $1.275-1.475 billion.

Analysts expect the company’s revenue growth to remain stable at around 4-5%.

WES stock has a dividend yield of 8.3%.

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About the Author Omor Ibne Ehsan →

Omor Ibne Ehsan is a writer at 24/7 Wall St. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks.