Should You Invest in the Top Three Dividend Stocks with the Highest Yields in the S&P 500?

Exploring High-Yield Dividend Stocks in the S&P 500

The S&P 500 is not only a benchmark for the stock market but also a rich source of dividend-paying companies. Recent figures from S&P Dow Jones Indices reveal that 409 out of the 500 stocks in the index offer dividends to their shareholders.

With such a large pool, investors have plenty of options. Yield is a key consideration for those seeking income, so let's focus on the three highest-yielding dividend stocks in the S&P 500: Conagra Brands (NYSE: CAG), LyondellBasell Industries (NYSE: LYB), and Healthpeak Properties (NYSE: DOC). Are these stocks worth adding to your portfolio? Here’s my perspective on each.

1. Conagra Brands (Dividend Yield: 7.5%)

While Conagra Brands may not be a familiar name to everyone, its products are staples in many American households. Specializing in packaged foods, Conagra owns a wide array of brands such as Hunt’s sauces, Birds Eye vegetables, and Slim Jim snacks.

Packaged and frozen foods were once a mainstay for many consumers, but changing tastes and a shift toward healthier eating habits have reduced their appeal. As a result, Conagra has seen its annual revenue decline for two consecutive years, and its profitability has suffered. The company’s most recent quarter showed a 35% drop in net income (excluding GAAP adjustments), and its forecast for the current fiscal year suggests flat or slightly declining sales.

Despite its strong presence in the packaged food sector, Conagra’s prospects for growth appear limited. For those seeking high-yield dividend stocks, there may be better opportunities elsewhere.

2. LyondellBasell Industries (Dividend Yield: 7.2%)

LyondellBasell, a major player in the chemical industry, recently made a significant change by nearly halving its dividend. Although the new, lower payout will take effect soon, the current yield is still based on the previous amount.

The high yield was largely a result of the stock’s poor performance last year—when share prices fall, yields rise. Recent geopolitical events, such as conflict in the Middle East, have impacted crude oil supplies and prices. This is important because European and Asian chemical companies rely on naphtha, a crude derivative, while American firms like LyondellBasell use alternatives such as ethane from natural gas. The ongoing conflict has also disrupted chemical supplies from the region.

Is LyondellBasell now overpriced due to renewed interest? I don’t believe so. The stock’s steep decline last year was driven by issues like tariffs, global oversupply, and competition from lower-cost Asian producers. Even if the conflict is resolved soon, improvements in these areas could help the company’s fundamentals and share price recover. The new dividend, at $0.69 per share, still offers a solid yield of 4.1%. While the stock carries risks due to volatility, it may appeal to investors willing to take on more uncertainty.

3. Healthpeak Properties (Dividend Yield: 7%)

Healthpeak Properties is a real estate investment trust (REIT) specializing in healthcare-related properties, including medical offices, laboratories, and senior housing. By the end of 2025, Healthpeak owned 689 properties across the United States.

Earlier this year, Healthpeak announced plans to spin off its senior living assets into a new REIT, Janus Living, which it will manage externally. This transition is expected to be completed through an IPO by the end of the second quarter.

The company leases its medical and lab properties under triple-net agreements, meaning tenants cover not only rent but also expenses like taxes, insurance, and maintenance. This approach helps keep Healthpeak’s costs low, especially given its large portfolio.

Annual rent increases are built into these leases, providing steady growth. In the fourth quarter of 2025, Healthpeak reported a 3% year-over-year rise in revenue to $719 million, and funds from operations—a key profitability metric for REITs—increased 7% to $333 million.

The healthcare sector is poised for continued expansion as the population ages, and Healthpeak’s monthly dividend payments add to its appeal. With disciplined management and a strong business model, Healthpeak stands out as a reliable investment.

Is Conagra Brands a Good Buy Right Now?

Before investing in Conagra Brands, consider this:

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Eric Volkman does not own shares in any of the companies discussed. The Motley Fool suggests investing in Healthpeak Properties. For more information, see our disclosure policy.