highest dividend yield stocks 2025: Guide

Highest Dividend Yield Stocks (2025)

As an income-focused investor evaluating options from the U.S. listed market, understanding the highest dividend yield stocks 2025 is essential. This article explains what the phrase means, how yields are measured, which security types (common stocks, REITs, BDCs, MLPs, CEFs and dividend/option-income ETFs) often produced the largest yields in 2025, the screening methods used by major publishers, associated risks, and practical due diligence steps.

As of December 31, 2025, according to Fidelity (December 2025), many screens and curated lists identified a mix of financial BDCs, mortgage REITs, energy midstream names and closed-end funds among the highest-yielding securities. As of November 30, 2025, according to Morningstar (November 2025), some high-yield lists delivered strong total returns while others showed elevated volatility and dividend cuts; these mixed outcomes illustrate the difference between headline yield and sustainable income.

Definition and measurement of dividend yield

Dividend yield is a simple ratio that expresses income from dividends relative to the security's market price. The standard formula is:

Annual dividend per share ÷ Current price per share = Dividend yield

There are two practical yield measures investors encounter:

• Trailing twelve-month (TTM) yield: the sum of dividends actually paid in the past 12 months divided by the current price. It reflects historical payouts.
• Forward (or indicated) yield: the next 12 months’ expected dividends (based on announced rates or company guidance) divided by the current price. Forward yield projects income but depends on management guidance or declared rates.

Analysts and screeners also display distribution yield for funds and REITs, and SEC yield for bond-like funds. For closed-end funds (CEFs) and ETFs the reported yield may include realized/unrealized gains, return-of-capital (ROC), or option-premium income; parsing the components is important to judge sustainability.

Market context in 2025

The macro and market environment in 2025 shaped headline yields and investor appetite for income.

• Interest-rate backdrop: After several years of central-bank rate normalization, short- and intermediate-term rates remained elevated for most of 2025 relative to the very low-rate era earlier in the decade. Higher interest rates put upward pressure on yields demanded by investors and pressured prices for rate-sensitive sectors like REITs and utilities.

• Sector rotation: Equity flows moved between cyclical value sectors (energy, materials) and defensive income sectors (utilities, consumer staples, REITs), depending on growth expectations and commodity cycles. That rotation produced pockets of higher yields where share prices moved lower.

• Credit and liquidity: Tighter credit spreads at times supported dividend distributions; conversely, sector-specific credit stress (for example in some mortgage REITs or struggling BDCs) led to dividend cuts and higher headline yields on remaining names.

As of October 20, 2025, according to Kiplinger (Oct 2025), S&P 500 high-yielders tended to cluster in tobacco, telecom, and some large-cap energy and consumer staples names, while the highest headline yields overall were often in niche, levered structures outside the S&P 500.

Types of high-yield income securities

High yield in 2025 appeared across several security types. Understanding their structure and payout mechanics is key.

• Common equities with high cash dividends: Publicly traded corporations that pay regular cash dividends from earnings or retained cash. Examples in 2025 included large-cap dividend payers and select smaller firms.

• Real Estate Investment Trusts (REITs): REITs must distribute a large percentage of taxable income to shareholders, which often creates higher yields. There are equity REITs (own property) and mortgage REITs (mREITs) that finance property. mREITs typically have higher leverage and higher headline yields but also higher risk.

• Business Development Companies (BDCs): BDCs provide financing to small- and mid-sized private companies and distribute most taxable income. BDC yields can be attractive but may reflect credit cycles and portfolio losses.

• Master Limited Partnerships (MLPs) and midstream energy: MLPs historically provided large distribution yields tied to energy transport and storage cash flows. Tax treatment differs because distributions can include return-of-capital components.

• Closed-end funds (CEFs): CEFs often use leverage or option strategies to boost distributions. Their market price can trade at a premium or discount to net asset value (NAV), and reported yields may reflect realized gains or ROC.

• Dividend and option-income ETFs: Some ETFs pursue high income by holding high-yielding equities, employing covered-call overlays, or using option strategies; these ETFs present diversified exposure but can have variable distribution drivers.

Tax treatment, payout regularity and disclosure practices differ across these types; REITs, MLPs and BDCs often have non-qualified distributions or ROC, which affects after-tax income for investors in taxable accounts.

Common sectors and sources of high yields

Certain sectors consistently produced many of the highest-yielding securities in 2025:

• Financials and BDCs: Specialty finance companies and BDCs that lend to private companies often yielded above market averages due to portfolio yields and pass-through distribution policies.

• Mortgage REITs and finance REITs: mREITs often showed some of the largest headline yields, reflecting high leverage and sensitivity to interest rates.

• Energy and midstream infrastructure: Pipelines, storage and transport companies and MLP-like structures often paid sizable distributions tied to commodity throughput and fee-based contracts.

• Utilities and telecom: Large-cap regulated utilities and mature telecom firms sometimes offered elevated but steadier yields, attracting income investors seeking lower volatility.

• Consumer staples and select industrials: Defensive, cash-generative companies occasionally offered above-average yields in late-cycle or rotating markets.

Sector dynamics matter: commodity-dependent payouts rise and fall with commodity cycles, while leveraged finance and mREIT yields respond acutely to funding costs and balance-sheet stress.

Notable 2025 high-yield lists and sample names

Several major publishers and research firms published curated high-yield lists during 2025. These lists relied on screens and editorial judgment. Below are short descriptions and representative examples drawn from those lists. As of the noted dates, reported examples appeared frequently across screens.

Fidelity — Potentially highest paying dividend stocks in 2025

As of December 15, 2025, according to Fidelity (Dec 15, 2025), Fidelity’s curated screens focused on diversified income sources including BDCs, finance REITs and select dividend-paying common stocks. Representative tickers that appeared on Fidelity lists included names like Prospect Capital, FS KKR Capital, Oxford Square Capital, Armour Residential REIT and OFS Capital. Fidelity’s approach often highlighted payout coverage, distribution type and whether dividends were sourced from core earnings or capital return.

Kiplinger — Highest-yielding dividend stocks in the S&P 500

As of January 10, 2026, referencing Kiplinger’s January coverage of 2025 yields (Jan 10, 2026), Kiplinger emphasized S&P 500 constituents with higher-than-average yields. Examples commonly cited in late 2025 included large-cap payers like Verizon, Altria, LyondellBasell, Conagra, Pfizer and several REITs included in the S&P 500 such as Healthpeak Properties and Realty Income.

The Motley Fool — Top high-yield picks for 2025/2026

The Motley Fool compiled longer watchlists and editors’ picks as of November 20, 2025, highlighting dividend growth and total-return potential. Their 20-stock lists commonly included AbbVie, Duke Energy, Enterprise Products Partners, Enbridge, Healthpeak Properties, Pfizer, Realty Income and Verizon among others.

Morningstar — Top-performing dividend stocks of 2025

As of November 30, 2025, according to Morningstar (Nov 30, 2025), Morningstar’s lists focused on year-to-date performance combined with income sustainability. Sample outperformers in 2025 that also offered attractive yields included CVS Health, Invesco’s certain fund shares, Hasbro and, in some months, rising-energy service names.

Screens and databases (WallStreetZen, ModestInvestor, Dividend.com, Barchart, SureDividend)

These platforms provided broad screens and ranked lists for high yields. As of December 2025, they highlighted many repeat names: mortgage REITs and BDCs such as BlackRock TCP Capital, Horizon Technology Finance, WhiteHorse Finance and OFS Capital; midstream names like Enterprise Products Partners; and high-yield CEFs and option-income ETFs. SureDividend also published variants of the Dogs of the Dow for 2025, applying classic low-price-high-yield selection rules.

Note: Sample names above illustrate recurring appearances across multiple 2025 high-yield screens. Headline yields and ranking positions were time-sensitive and changed with price moves and declared distributions.

How yield screens are constructed (methodologies)

In 2025, common screening filters and methodology components included:

• Minimum yield threshold: Many screens started at 4%–6% and pushed higher (8%+) for “high-yield” categories.
• Payout history: Filters for consecutive years of dividends, recent increases or absence of cuts.
• Payout ratio limits: Maximum payout ratio by earnings or cash flow (often 60%–90% depending on sector).
• Market-cap and liquidity: Minimum market-cap and average daily trading volume to avoid illiquid microcaps.
• Listing and jurisdiction: Screens often limited to U.S.-listed securities or ADRs.
• Sector and industry caps: To avoid overconcentration in cyclical or high-risk sectors.
• Fund-specific metrics: For ETFs/CEFs, screens included discount/premium to NAV, leverage ratio, option overlay strategy, and historical distribution sources (income vs ROC).

Platforms combined quantitative filters (yield, payout ratio, coverage metrics) with qualitative checks (management commentary, recent filings) to produce curated lists. Investors should note that default screener outputs may include names with temporarily inflated yields due to recent share-price drops.

Metrics for assessing dividend sustainability

High yield alone is an incomplete signal. Key metrics to assess sustainability include:

• Payout ratio (earnings-based): Dividends ÷ net income (useful but subject to accounting variations).
• Payout ratio (cash-flow-based): Dividends ÷ operating cash flow or free cash flow (often more conservative and informative).
• Free cash flow (FCF) trend: Positive and growing FCF supports continued distributions.
• Dividend coverage: Number of times earnings or FCF covers the dividend.
• Interest coverage and leverage: EBITDA-to-interest-expense, debt/EBITDA ratios; high leverage increases cut risk.
• Portfolio credit quality (for BDCs): Weighted-average credit rating and non-accrual levels.
• Occupancy and rent collections (for REITs): For equity REITs, occupancy, lease roll and tenant credit matter.
• Distribution sources (for CEFs): Percentage of distribution funded by realized income vs return-of-capital.

No single metric suffices; combining these indicators with qualitative assessment of management policy and sector conditions yields a more robust view.

Risks and common pitfalls (yield traps)

Very high headline yields can reflect elevated risk rather than dependable income. Common pitfalls include:

• Share-price collapse inflating yield: When price falls sharply, the dividend ÷ price ratio rises even if dividend is unchanged. The underlying cause may be deteriorating fundamentals.
• Dividend cuts/suspensions: Firms under cash stress may reduce or suspend distributions; BDCs, mREITs and high-leverage CEFs were most vulnerable in 2025.
• Return-of-capital masking: Some funds distribute ROC to maintain headline yield while eroding NAV.
• Sector-specific cyclicality: Energy distributions can fall with commodity prices; mortgage REITs respond to interest-rate spreads.
• Liquidity and market-cap risk: Illiquid small caps can offer high yield but present execution and price-risk for investors.

A careful reader of 2025 high-yield lists observed many examples where headline yield outpaced sustainable cash generation, highlighting the need for conservative screening.

Investment strategies and use-cases in 2025

Investors applied different approaches to high-yield opportunities:

• Income-oriented buy-and-hold: Prioritize names with stable coverage and long payout histories for consistent cash flow.
• Dividend-growth focus: Seek moderate-yield names with a history of increases to grow income over time.
• Yield-chasing with active risk management: Use position sizing, stop-loss rules, and diversified exposure across sectors.
• Dogs of the Dow and value-yield strategies: Classic low-price-high-yield selections reappeared in 2025 as a value-income approach.
• Covered-call overlays and option-income strategies: Some investors used covered-call ETFs or wrote covered calls on stock positions to boost income at the expense of upside.
• Use of ETFs and CEFs as wrappers: For convenience and diversification, investors used high-yield ETFs/CEFs to access BDCs, REITs and income strategies rather than selecting single names.

Each strategy has trade-offs between yield, risk and liquidity. Diversification across security types and sectors can reduce idiosyncratic dividend risk.

Tax and distribution considerations

Tax treatment varies by security type and can materially affect after-tax yield:

• Qualified vs non-qualified dividends: Qualified dividends receive favorable tax rates for most U.S. taxpayers; many REIT, MLP and BDC distributions are non-qualified and taxed as ordinary income or ROC.
• REITs and MLPs: Often return-of-capital components reduce current taxable income but lower cost basis for future gains; MLPs have partnership tax forms and K-1 reporting complexity.
• CEFs and ETFs: Distributions can include ordinary income, qualified income, capital gains and ROC. The presence of ROC reduces current tax but can indicate return of principal.
• Account placement: High-tax distributions are often better held in tax-advantaged accounts (IRAs, 401(k)s) to improve after-tax outcomes.

Tax rules and investor circumstances vary; consult a tax professional for specific guidance.

Performance outcomes and empirical observations (2025 lens)

Empirical takeaways from 2025 included:

• Not all high-yield lists outperformed: Some curated lists (for example, Morningstar’s top-performing dividend stocks of 2025) showed outperformance, but other high-yield trackers exhibited volatility and dividend reductions.
• Yield alone did not predict total return: Names with very high yields often returned negative price performance that offset income, while moderate-yield, dividend-growth names sometimes delivered better total returns.
• Sector effects were strong: High-yield energy and midstream names benefited when commodity prices rose, while mortgage REITs outperformed when rate spreads compressed.

As of November 30, 2025, according to Morningstar (Nov 30, 2025), some of the best total-return outcomes among dividend lists combined reliable distributions with capital appreciation rather than yield alone.

Due diligence checklist before buying

Before allocating capital to any name identified on a “highest dividend yield stocks 2025” list, run this checklist:

• Confirm the current yield and whether it is trailing or forward.
• Review the company’s most recent filings (10-Q/10-K) for cash-flow and payout details.
• Check payout ratios on both earnings and cash-flow bases.
• Examine balance-sheet leverage and interest-coverage ratios.
• For funds, review distribution sources (income vs ROC) and leverage level.
• Assess sector outlook and macro risks (commodity prices, rate sensitivity, tenant demand for REITs).
• Check management commentary and any upcoming votes or restructuring actions.
• Verify average daily trading volume and market-cap to ensure liquidity.
• Review analyst coverage and recent credit ratings where applicable.
• Consider tax treatment and account placement (taxable vs tax-advantaged).

A methodical checklist reduces surprises and helps distinguish durable income from headline yields that reflect short-term repricing.

Tools, screeners and data sources used in 2025

Investors and writers in 2025 relied on a mix of vendor screeners and research platforms. Commonly used tools included proprietary brokerage screeners (e.g., Fidelity’s), editorial lists from Kiplinger, The Motley Fool and Morningstar, and large databases from WallStreetZen, Dividend.com, Barchart, ModestInvestor and SureDividend. Data inputs included exchange filings, company investor-relations releases, NAV reports for funds, and market-data providers.

When using these tools, confirm the date of the yield calculation and whether the platform shows forward or trailing yield. As of December 15, 2025, according to Fidelity (Dec 15, 2025), their income-focused screener displayed indicated yield alongside trailing yield to aid investor comparison.

Notable regulatory, accounting, or market events affecting dividends in 2025

Key events in 2025 that influenced dividend policy and payouts included:

• Sector-specific credit events: Several specialty finance names and some mortgage REITs experienced higher non-accruals earlier in 2025, prompting dividend reductions.
• Tax and accounting updates: No single industry-wide tax reform dramatically changed dividend treatment in 2025; however, heightened regulatory scrutiny in credit-focused sectors led to enhanced disclosure requests.
• Corporate restructurings and M&A: Some large-cap dividend payers revised payout ratios in response to acquisitions or restructuring activity, affecting their reported yields.

Investors tracking the highest dividend yield stocks 2025 observed that material corporate events could rapidly change yield profiles and sustainability.

See also

• Dividend yield
• Dividend aristocrats
• Real Estate Investment Trusts (REITs)
• Business Development Companies (BDCs)
• Dividend investing strategies
• Dogs of the Dow

References and further reading

The article compiles observations and methodologies from multiple 2025 sources. Representative references include:

• Fidelity — Potentially highest paying dividend stocks in 2025 (Dec 2025)
• Kiplinger — Highest-Yielding Dividend Stocks in the S&P 500 (Oct–Jan 2025/2026 coverage)
• The Motley Fool — 20 High-Yield Dividend Stocks to Buy in 2025/2026 (Nov 2025)
• Morningstar — 10 Top-Performing Dividend Stocks of 2025 (Nov 30, 2025)
• WallStreetZen — Highest Dividend Yield Stocks to Buy (2025 screens)
• ModestInvestor — Top 100 High-Yield Dividends (Stocks, REITs & ETFs) (2025)
• SureDividend — 2025 Dogs Of The Dow list and 2026 high dividend stock lists (2025–2026)
• Dividend.com — Top High-Yield Dividend Stocks, ETFs, Funds (2025)
• Barchart — Best High-Yield Dividend Stocks to Buy for 2025 and Beyond (2025)

All references above were used as background for screening methods, sample names and sector observations. For the most current yields and distribution details consult company filings and platform data as yields change daily.

Practical next steps and how Bitget can help

If you track income securities and want a consolidated workflow, consider using platform screeners and watchlists to monitor yield changes, ex-dividend dates and distribution announcements. For investors who use web3 wallets or bridges in their broader portfolio, Bitget Wallet provides custody and management tools. For trading and market access, consider platforms that match your regulatory jurisdiction and product needs.

Explore more research tools, set alerts for ex-dividend dates and distribution changes, and maintain a diversified income allocation aligned with your risk tolerance.

Further explore our resources to compare screener outputs and to build a repeatable income-investment checklist that fits your objectives.

Note: This article is informational and neutral in tone. It does not provide personalized investment advice. Market values, yields and distributions referenced were time-sensitive in 2025; always verify current data before making investment decisions.