I have invested in dividends for 10 years—These ultra-high-yield stocks are my top picks

Dividend stocks are a cornerstone strategy for long-term investors, offering a reliable income stream and potential for capital appreciation. By investing in companies that consistently pay dividends, investors can harness the power of compounding, reinvesting payouts to grow wealth over decades. 

This approach suits those with a long-term mindset, as dividends often signal financial stability and disciplined management, providing a buffer against market volatility. For those seeking passive income, dividends deliver cash flow without selling assets, preserving principal while funding lifestyle needs.

However, chasing ultra-high-yield stocks carries risks, such as unsustainable payouts or declining stock prices, often reflecting underlying financial distress or sector challenges. These pitfalls can erode returns if dividends are cut or the company falters. Yet, certain high-yield stocks stand out as excellent investments when chosen carefully—those with strong cash flows, manageable payout ratios, and resilient business models in stable industries. 

By prioritizing quality over the highest yields, investors can mitigate risks while securing steady income and growth. I’ve been a dividend growth investor for a decade, and the following two robust dividend payers remain uniquely positioned to capitalize on the strengths of a regular income stream and stock price appreciation, so long as they align with your goals and risk tolerance.

Enbridge (ENB)

Leading North American energy infrastructure company Enbridge (NYSE:ENB) is a compelling high-yield stock for 2025, boasting a forward dividend yield of approximately 6.0%, four times greater than the average yield of the S&P 500. 

Operating extensive oil and natural gas pipelines, including the Canadian Mainline system, and owning North America’s largest gas utility, Enbridge generates stable cash flows from its 98% contracted or regulated revenue streams. This resilience, coupled with a 30-year streak of annual dividend increases, makes it a reliable choice for income-focused investors. 

Enbridge’s diversified portfolio — 50% liquids pipelines, 30% gas transmission, 15% gas utilities, and 4% renewables — help mitigate commodity price volatility and ensures dividend sustainability.

Its 2025 projected EBITDA of $19.4 billion to $20 billion Canadian, up around 15% from the midpoint of guidance from 2024, reflects growth from recent U.S. gas utility acquisitions and a $7 billion capital program. 

The midstream energy company’s enterprise-value-to-EBITDA ratio of 13 is in line with its average over the past few years, but is low compared to its historical 10-year average. Coupled with its investment-grade balance sheet and 3% distributable cash flow per share growth forecast through 2026, Enbridge can support ongoing dividend hikes. For conservative investors, its shift toward natural gas and renewables aligns with global energy trends, enhancing long-term value. While market volatility poses risks, its stable cash flows and high yield make it a premier pick. 

Verizon (VZ)

The second high-yield dividend stock to buy is Verizon (NYSE:VZ). With a forward dividend yield of approximately 6.8%, the telecom giant appeals to income-focused investors. It generates stable cash flows from its expansive 5G network and broadband services, supporting its 18-year streak of dividend increases. 

Trading at a forward P/E of 8.44, well below the S&P 500’s 24.2, Verizon is undervalued, offering both income and potential capital appreciation. It has a sustainable free cash flow (FCF) payout ratio of 59% as it has been growing FCF at around 3.8% annually for the past decade, ahead of the 2.3% compound annual growth rate of its dividend. Over the trailing 12 months, Verizon produced $18.7 billion in cash profits.  

Bolstered by growth in wireless subscriptions and fixed wireless broadband, Verizon’s focus on cost-cutting and debt reduction strengthens its investment-grade balance sheet. That mitigates risks from interest rate fluctuations. For conservative investors, its defensive nature — telecom services remain essential regardless of economic conditions — makes it a resilient choice amidst 2025 market volatility. 

While competition and regulatory pressures pose challenges, Verizon’s scale and infrastructure investments position it for steady growth. Its high yield and low valuation make it a compelling pick for those seeking reliable income. 

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