Investing
Dividend stocks are a favorite among investors for good reason. They provide a steady stream of passive income and offer a promising avenue for total return. Total return is a comprehensive measure of investment performance, which includes interest, capital gains, dividends, and distributions realized over time. At 24/7 Wall St., we have focused on dividend stocks for over 15 years because, despite the ups and downs that accompany the stock market, many people face the reality of needing solid passive income streams to supplement their income from employment or other sources. One item we have noticed over the years is that sometimes very well-known companies that pay big and dependable dividends fly under the radar screens, and for various reasons don’t get noticed.
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Off-the-radar high-yield dividend stocks are big total return candidates.
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With interest rates likely to remain unchanged for the rest of 2025, dividend stocks will remain popular.
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The stock market could remain volatile through the summer as tariffs are sorted out.
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Growth and income investors and those looking for dependable passive income should pivot to quality high-yield stocks that pay dependable quarterly dividends and offer solid growth potential. Four of our favorite high-yield dividend stocks are on sale and look like perfect ideas now. Many investors overlook these great companies, and all pay at least a 6% dividend.
Why do we cover dividend stocks?
Since 1926, dividends have contributed approximately 32% of the total return for the S&P 500, while capital appreciation has contributed 68%. Therefore, sustainable dividend income and capital appreciation potential are essential for total return expectations. A study by Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the 50 years from 1973 to 2023. Over the same timeline, this was more than double the annualized return for non-payers (3.95%).
Bloomin’ Brands
With a portfolio of well-known restaurants and a massive dividend, this is a solid idea for 2025. Bloomin’ Brands Inc. (NASDAQ: BLMN) owns and operates casual, upscale casual, and fine dining restaurants in the United States and internationally.
Its restaurant portfolio has four concepts:
- Outback Steakhouse, a casual steakhouse
- Carrabba’s Italian Grill, a casual Italian restaurant
- Bonefish Grill
- Fleming’s Prime Steakhouse & Wine Bar, a contemporary steakhouse
The company owns and operates more than 1,450 restaurants in 46 states, Guam, and 13 countries, some of which are franchise locations. Given the current trading level under $10 and the huge dividend, this could be an incredible 2025 total return idea.
Energy Transfer
Energy Transfer L.P. (NYSE: ET) is one of North America’s largest and most diversified midstream energy companies. This top master limited partnership is a safe way for investors looking for energy exposure and income, as the company pays a massive distribution. Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint in all of the major domestic production basins.
The company is a publicly traded limited partnership with core operations that include:
- Complementary natural gas midstream, intrastate, and interstate transportation and storage assets
- Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets
- NGL fractionation
- Various acquisition and marketing assets
After purchasing Enable Partners in December 2021, Energy Transfer owns and operates more than 114,000 miles of pipelines and related assets in 41 states, covering all major U.S. producing regions and markets. This further solidifies its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, formerly known as Energy Transfer Partners, the company also owns Lake Charles LNG, the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco, and the public partner interests and 39.7 million standard units of USA Compression Partners.
Franklin Resources
Better known as Franklin Templeton, this is one of the world’s largest investment managers. This company is a mutual fund powerhouse that pays a safe and secure dividend. Franklin Resources Inc. (NYSE: BEN) is among the most prominent global money managers.
The firm markets mutual funds and institutional separate accounts under the Franklin, Templeton, and Mutual Series brands. At times, 50% of its sales are from outside the United States, an advantage given the maturing U.S. market.
Franklin Resources offers its products and services under the brands of:
- Franklin
- Templeton
- Franklin Mutual Series
- Franklin Bissett
- Fiduciary Trust
- Darby
- Balanced Equity Management
- K2
- LibertyShares
- Edinburgh Partners
The 2023-2024 bull market was a strong tailwind for the company. While withdrawals from baby boomers may be a concern, the path forward for the balance of 2025 also looks solid.
Wendy’s
Trading at a reasonable 13 times trailing earnings, this company is one of America’s favorite fast-food destinations. Wendy’s Co. (NYSE: WEN) primarily operates, develops, and franchises a system of distinctive quick-service restaurants. The company’s menu includes made-to-order square hamburgers using beef, fan favorites like the Spicy Chicken Sandwich and nuggets, Baconator, and the Frosty dessert.
Its segments include:
- Wendy’s U.S
- Wendy’s International
- Global Real Estate & Development
Wendy’s U.S. includes operating and franchising its restaurants in the United States, while Wendy’s International includes operating and franchising its restaurants in countries and territories other than the United States.
Global Real Estate & Development includes real estate activity for owned sites and sites leased from third parties, which are leased and/or subleased to franchisees. It also contains its share of the income of its Canadian restaurant real estate joint venture (TimWen).
The company and its franchisees have over 7,000 restaurants worldwide.
Investors Are Buying High-Yield Stocks Hand-Over-Fist: 5 Favorites That Yield 7% or More
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