Investing

Energy Sector Has Biggest Buying Since 2023: 4 Ultra-High-Yield Dividend Stocks Are on Fire

Lee Jackson

Published: June 24, 2025 7:04 am

Last Updated: June 24, 2025 7:18 am

Investors love dividend stocks, especially those with ultra-high yields, because they offer a significant income stream and have substantial total return potential. Total return includes interest, capital gains, dividends, and distributions realized over time. In other words, the total return on an investment or a portfolio consists of income and stock appreciation. Let’s take a closer look at the concept of total return. Imagine you purchase a stock at $20 that offers a 3% dividend. If the stock price rises to $22 within a year, your total return is 13%. This is calculated by adding the 10% increase in stock price to the 3% dividend.

24/7 Wall St. Key Points:

• The major oil benchmarks have rallied off lows not seen since 2021
• Volatility looks like it could be here to stay for at least the foreseeable future due to the attacks on Iran
• Ultra-high-yield energy stocks are a great idea for investors now, with the stock market back close to all-time highs
• Are energy stocks with huge dividends a good idea for you? Why not meet with a financial advisor near you for a complete portfolio review? Click here to get started finding one today. (Sponsored)

The energy sector in 2025 was experiencing a period of volatility and transition, influenced by fluctuating commodity prices, shifting demand patterns, and evolving geopolitical dynamics. Declining oil Prices were the big story until the U.S attack on the nuclear facilities in Iran. While prices initially jumped following the U.S. strikes on Iranian nuclear facilities, they quickly reversed course after Iran’s tepid response. What remains to be seen is whether Iran attempts to block the Strait of Hormuz, situated between the Persian Gulf and the Gulf of Oman, which provides the only sea passage from the Persian Gulf to the open ocean. It is one of the world’s most strategically important locations, and some on Wall Street believe that if Iran were to attempt to block passage, oil prices could surge as high as $120 a barrel. 

While some of the integrated super majors have posted solid results so far, it remains uncertain how the energy sector will perform in the second half of 2025. We screened our 24/7 Wall St. energy research database, looking for quality companies that have been sold off for various reasons, offer massive dividends, and have some excellent entry points.  Four look like incredible values now, and all are rated Buy at the top firms we cover on Wall Street.

Why do we cover ultra-high-yield energy stocks?

While not suited for everybody, those trying to build strong passive income streams can do exceptionally well with some of these top companies in their portfolios. Paired with more conservative blue-chip dividend giants, investors can employ a barbell approach to generate substantial passive income streams.

Mach Natural Resources

Mach Natural Resources L.P. (NYSE: MNR) is an independent upstream oil and gas company that acquires, develops, and produces oil, natural gas, and NGL. The company is focused on the acquisition, development, and production of oil, natural gas, and NGL reserves in the Anadarko Basin region, which spans Western Oklahoma, Southern Kansas, and the panhandle of Texas.

The company’s Resources assets are located throughout Western Oklahoma, Southern Kansas, and the panhandle of Texas and consist of approximately 5,000 gross operated proved developed producing (PDP) wells.

Additionally, it owns a portfolio of midstream assets that support its leases, including ownership in four processing plants with a combined processing capacity of 353 million cubic feet per day (MMcf/d), as well as 1,480 miles of gas-gathering pipelines. It also owns water infrastructure consisting of 880 miles of gathering pipeline and 88 disposal wells.

Despite missing Wall Street estimates, the company announced a massive $0.79 distribution for the quarter and reaffirmed its earnings outlook for the year. The shares won’t go ex-dividend again until August 22nd, so it will be important for investors to check if the $0.79 distribution is held or reduced. With prices much higher than they were before the last dividend, it could very well stay at that huge payout level.

Raymond James has assigned a Strong Buy rating with a target price of $25.

MPLX

MPLX L.P. (NYSE: MPLX) is a diversified, large-cap master limited partnership formed by Marathon Petroleum Corp. (NYSE: MPC). This company is one of the top holdings in the Alerian MLP Energy Exchange-Traded Fund and pays a healthy dividend. MPLX is primarily engaged in transporting crude oil and refined products, with termini in the U.S. Midwest and Gulf Coast regions, as well as natural gas gathering and processing in the Northeast, following its acquisition of MarkWest Energy in 2015.

The company’s assets include:

• Network of crude oil and refined product pipelines
• Inland marine business
• Light-product terminals
• Storage caverns
• Refinery tanks
• Docks
• Loading racks and associated piping
• Crude and light-product marine terminals

MPLX also owns:

• Crude oil and natural gas gathering systems
• Pipelines, natural gas, and NGL processing and fractionation facilities in key U.S. supply basins

Wells Fargo has set a $59 target to accompany its Overweight rating.

Plains All American Pipeline

This stock has been locked in a tight trading range, looks ready to break out, and pays a huge dividend. Plains All American Pipeline L.P. (NYSE: PAA), through its subsidiaries, engages in the pipeline transportation, terminalling, storage, and gathering of crude oil and natural gas liquids (NGL) in the United States and Canada.

The company operates in two segments:

• Crude Oil
• Natural Gas Liquids

The Crude Oil segment offers:

• Gathering and transporting crude oil through pipelines
• Gathering systems
• Trucks, barges, or railcars
• Terminalling, storage, and other facilities-related services and merchant activities

The Natural Gas Liquids segment provides:

• Gathering
• Fractionation
• Storage
• Transportation
• Terminalling activities
• Ethane, propane, normal butane, iso-butane, natural gasoline, and crude oil refining processes

Mizuho has an Outperform rating with a $22 target price objective.

TXO Partners

TXO Partners acquires, develops, optimizes, and exploits conventional oil, natural gas, and natural gas liquid reserves. With a massive dividend and trading near a 52-week low, TXO Partners L.P. (NYSE: TXO) is a master limited partnership that focuses on the acquisition, development, optimization, and exploitation of conventional oil, natural gas, and natural gas liquids (NGL) reserves in North America.

The company’s acreage positions are concentrated in three main areas:

•  Permian Basin of West Texas and New Mexico
•  San Juan Basin of New Mexico and Colorado
•  Williston Basin of Montana and North Dakota

Its assets consist of approximately 1,117,628 gross (549,229 net) leasehold and mineral acres located primarily in the Permian Basin, San Juan Basin, and Williston Basin. The assets include a 50% interest in Cross Timbers Energy, LLC, also known as Cross Timbers.

As an operator, it designs and manages the development, recompletion, or workover of all the wells it operates, and supervises operation and maintenance activities on a day-to-day basis. The Company markets the majority of the natural gas, NGL, crude oil, and condensate production from the properties on which it operates.

Stifel has a Buy rating with a $20 target price.