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Seeking Income Into 2026? 3 High-Yield Stocks to Buy Now
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Key Takeaways
PAGP gains from crude-focused pipeline assets and an EPIC buyout aimed to generate stable cash flows.
AES is expanding its renewables portfolio while backing EBITDA guidance and dividend payments.
Telefnica launched a multi-year growth plan targeting cost savings, revenue growth, and sustained dividends.
Economic uncertainty, easing interest rates and increasing geopolitical tensions continue to be key concerns as investors head into the new year. These factors are compelling investors to focus on investment strategies that deliver a steady income stream rather than cyclical upside.
In the current environment, dividend-paying stocks, especially those offering yields of more than 5%, are a keystone of building strong portfolios that balance income generation with long-term wealth creation. Dividend stocks typically act as a hedge against economic uncertainty by offering downside protection with consistent payouts.
Some of the most dependable income opportunities are found in businesses tied to core infrastructure like utilities, telecom and pipelines. These industries may not be flashy, but they are deeply integrated into everyday life. Electricity, telecom/mobile connectivity, and energy transportation are essential services and not discretionary purchases. As a result, these companies witness predictable demand, largely shielded from economic ups and downs.
They have resilient business models, allowing them to generate steady operating cash flows and sustain dividend payouts across economic cycles.
Plains GP Holdings, L.P. ((PAGP - Free Report) ) is a holding company and the controlling entity of Plains All American Pipeline, L.P. (PAA). It holds an indirect non-economic controlling general partner interest and an indirect limited partner interest in PAA.
Plains All American Pipeline, a publicly traded master limited partnership, is involved in the transportation, storage, and marketing of crude oil and natural gas liquids (NGL) and refined products in the United States and Canada. It has a disciplined investment strategy to support the expansion of its operations through organic and inorganic growth initiatives. Earlier this year, PAA completed the acquisition of a 100% equity interest in EPIC Crude Holdings, LP, which owns and operates the EPIC Crude Oil Pipeline. The company is also selling its NGL business and redeploying the sale proceeds into crude-focused assets that it believes will provide more stable cash flows.
PAGP pays a quarterly dividend of 38 cents ($1.52 annualized) per share, with an 8.09% yield at the current stock price. The five-year dividend growth rate of 20.2%. The company currently sports a Zacks Rank #1 and has an industry rank in the top 44%.
The AES Corporation ((AES - Free Report) ) is a global energy company with a wide-ranging portfolio across hydro, wind, natural gas, solar, coal and battery storage assets. The company is taking advantage of the global transition to renewable energy by making strategic investments in clean energy solutions such as energy storage and utility-scale renewables, which offer a long-term growth opportunity. The second key catalyst is accelerating power demand from data centers, amid rapid AI and cloud computing proliferation.
Management reaffirmed its 2025 adjusted EBITDA guidance of $2.65-$2.85 billion, driven mainly by contributions from new renewables projects, rate base expansion across U.S. utilities, and the realization of cost savings. It expects to pay more than $500 million in dividends in 2025 while investing aggressively ($1.8 billion) in renewables and utilities growth.
AES pays out a quarterly dividend of 17.59 cents (70 cents annualized) per share, with a 5% yield at the current stock price. AES’ payout ratio is 34%, with a five-year dividend growth rate of 4.3%. The company currently carries a Zacks Rank #2 and has an industry rank in the top 31%.
Telefónica, S.A. ((TEF - Free Report) ) provides mobile and fixed communication services in Europe and Latin America. Recently, Telefonica launched Transform & Grow, a five-year strategy designed to drive sustainable growth, strengthen its leadership in Spain, Germany, the U.K. and Brazil, and accelerate its technological and operational evolution. The plan focuses on delivering a best-in-class customer experience, expanding B2C convergence and digital services, scaling its B2B and public-sector business, advancing network and IT capabilities, simplifying its operating model and developing top talent.
Telefonica targets up to €2.3 billion in savings by 2028 and €3 billion by 2030 through efficiency and digital transformation. Financial goals include 1.5-2.5% revenue and EBITDA CAGR through 2028, accelerating to 2.5-3.5% from 2028-2030, alongside stronger, de-risked free cash flow and continued investment-grade strength. The company confirmed a €0.30 per share dividend for 2025, set €0.15 per share for 2026 and plans to allocate 40-60% of free cash flow to dividends for 2027-2028.
TEF has a 6.2% yield at the current stock price, with a payout ratio is 76%. The company currently carries a Zacks Rank #2 and has an industry rank in the top 40%.
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Seeking Income Into 2026? 3 High-Yield Stocks to Buy Now
Key Takeaways
Economic uncertainty, easing interest rates and increasing geopolitical tensions continue to be key concerns as investors head into the new year. These factors are compelling investors to focus on investment strategies that deliver a steady income stream rather than cyclical upside.
In the current environment, dividend-paying stocks, especially those offering yields of more than 5%, are a keystone of building strong portfolios that balance income generation with long-term wealth creation. Dividend stocks typically act as a hedge against economic uncertainty by offering downside protection with consistent payouts.
Some of the most dependable income opportunities are found in businesses tied to core infrastructure like utilities, telecom and pipelines. These industries may not be flashy, but they are deeply integrated into everyday life. Electricity, telecom/mobile connectivity, and energy transportation are essential services and not discretionary purchases. As a result, these companies witness predictable demand, largely shielded from economic ups and downs.
They have resilient business models, allowing them to generate steady operating cash flows and sustain dividend payouts across economic cycles.
Stocks Worth Considering for 2026
With the help of the Zacks Stock Screener, we have narrowed down on three high-yield dividend stocks (with yields of 5% and above) that sport a Zacks Rank #1 (Strong Buy) or #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Plains GP Holdings, L.P. ((PAGP - Free Report) ) is a holding company and the controlling entity of Plains All American Pipeline, L.P. (PAA). It holds an indirect non-economic controlling general partner interest and an indirect limited partner interest in PAA.
Plains All American Pipeline, a publicly traded master limited partnership, is involved in the transportation, storage, and marketing of crude oil and natural gas liquids (NGL) and refined products in the United States and Canada. It has a disciplined investment strategy to support the expansion of its operations through organic and inorganic growth initiatives. Earlier this year, PAA completed the acquisition of a 100% equity interest in EPIC Crude Holdings, LP, which owns and operates the EPIC Crude Oil Pipeline. The company is also selling its NGL business and redeploying the sale proceeds into crude-focused assets that it believes will provide more stable cash flows.
Plains Group Holdings, L.P. Dividend Yield (TTM)
Plains Group Holdings, L.P. dividend-yield-ttm | Plains Group Holdings, L.P. Quote
PAGP pays a quarterly dividend of 38 cents ($1.52 annualized) per share, with an 8.09% yield at the current stock price. The five-year dividend growth rate of 20.2%. The company currently sports a Zacks Rank #1 and has an industry rank in the top 44%.
The AES Corporation ((AES - Free Report) ) is a global energy company with a wide-ranging portfolio across hydro, wind, natural gas, solar, coal and battery storage assets. The company is taking advantage of the global transition to renewable energy by making strategic investments in clean energy solutions such as energy storage and utility-scale renewables, which offer a long-term growth opportunity. The second key catalyst is accelerating power demand from data centers, amid rapid AI and cloud computing proliferation.
Management reaffirmed its 2025 adjusted EBITDA guidance of $2.65-$2.85 billion, driven mainly by contributions from new renewables projects, rate base expansion across U.S. utilities, and the realization of cost savings. It expects to pay more than $500 million in dividends in 2025 while investing aggressively ($1.8 billion) in renewables and utilities growth.
The AES Corporation Dividend Yield (TTM)
The AES Corporation dividend-yield-ttm | The AES Corporation Quote
AES pays out a quarterly dividend of 17.59 cents (70 cents annualized) per share, with a 5% yield at the current stock price. AES’ payout ratio is 34%, with a five-year dividend growth rate of 4.3%. The company currently carries a Zacks Rank #2 and has an industry rank in the top 31%.
Telefónica, S.A. ((TEF - Free Report) ) provides mobile and fixed communication services in Europe and Latin America. Recently, Telefonica launched Transform & Grow, a five-year strategy designed to drive sustainable growth, strengthen its leadership in Spain, Germany, the U.K. and Brazil, and accelerate its technological and operational evolution. The plan focuses on delivering a best-in-class customer experience, expanding B2C convergence and digital services, scaling its B2B and public-sector business, advancing network and IT capabilities, simplifying its operating model and developing top talent.
Telefonica targets up to €2.3 billion in savings by 2028 and €3 billion by 2030 through efficiency and digital transformation. Financial goals include 1.5-2.5% revenue and EBITDA CAGR through 2028, accelerating to 2.5-3.5% from 2028-2030, alongside stronger, de-risked free cash flow and continued investment-grade strength. The company confirmed a €0.30 per share dividend for 2025, set €0.15 per share for 2026 and plans to allocate 40-60% of free cash flow to dividends for 2027-2028.
Telefonica SA Dividend Yield (TTM)
Telefonica SA dividend-yield-ttm | Telefonica SA Quote
TEF has a 6.2% yield at the current stock price, with a payout ratio is 76%. The company currently carries a Zacks Rank #2 and has an industry rank in the top 40%.