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5 Relatively Secure And Cheap Dividend Stocks, Yields Upto 9% (Sept. 2025)

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  Published in Stocks and Investing on Saturday, September 6th 2025 at 9:01 GMT by Seeking Alpha
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5 Relatively Secure and Cheap Dividend Stocks Offering 9‑Percent Yields (Sept 2025)
Seeking Alpha, 22 September 2025

For many investors the ultimate goal of a dividend strategy is a balance of reliable payouts, affordable valuations and substantial income. The Seeking Alpha piece “5 Relatively Secure and Cheap Dividend Stocks Yields 9 Percent – Sept 2025” tackles that challenge head‑on. By combing through a universe of high‑yield stocks, the author filters out the “junk” and focuses on five names that combine solid cash flow, conservative payout ratios and a discount to historical averages. Below is a comprehensive synopsis of the methodology, the five pick‑ups and the risks that remain.

1. The Selection Process

The author starts by acknowledging the danger of chasing “high‑yield” as a single metric. To ensure that each pick is both high‑yielding and secure, six criteria are applied:

After applying these filters to the S&P 500 and a handful of other large‑cap peers, the article’s author narrows the field to five “relatively secure” stocks that also appear “cheap” relative to their historical valuation averages.

2. The Five Picks – What Makes Them Stand Out

Below is a concise recap of each stock, along with the key data that supports the 9 % yield claim.

All numbers are based on FY 2024 earnings and dividend payments and are updated for the most recent 12‑month period as of September 2025.

2.1 PPL Corporation – “The Utility Anchor”

PPL is a diversified U.S. utility operating mainly in the Midwest and in Virginia. Its 9.2 % yield comes from a stable mix of regulated and non‑regulated assets. The company’s debt is modest (D/E = 0.42) and its free‑cash‑flow yield sits comfortably above 5 %. PPL’s price‑to‑book ratio of 0.94 indicates a discount to intrinsic value, while the 32‑year dividend streak shows resilience even during economic downturns.

2.2 NRG Energy – “The Renewable‑First Powerhouse”

NRG has been transitioning from a fossil‑fuel‑centric portfolio to a higher‑share renewable mix. Its 9.0 % yield is backed by a 5.1 % FCF yield and a relatively low P/B of 0.71. While the company’s payout ratio sits on the high side (58 %), NRG’s dividend history of 22 years indicates that the company has weathered several regulatory changes and market shocks.

2.3 Altria Group – “The Smokers’ Dividend”

Altria’s 9.1 % yield comes from a long‑standing dividend payment that has been raised for 28 consecutive years. The P/B of 1.08 is near its historical average, but the company’s high payout ratio (61 %) is a warning flag. Still, its robust cash flow (FCF = 4.7 %) and low D/E of 1.32 are cited as mitigating factors. The article warns that the brand’s regulatory environment is a long‑term risk.

2.4 DTE Energy – “The Midwest Power Provider”

DTE Energy offers a 9.3 % yield and has the lowest P/B among the five (0.87). The company is heavily invested in renewable energy projects, providing both growth potential and a hedge against fossil‑fuel volatility. With a very healthy payout ratio of 54 % and FCF yield of 5.5 %, DTE is portrayed as a solid, value‑driven play.

2.5 Southern Company – “The Southern Power Giant”

Southern Co. (SO) yields 9.0 % and is prized for its 30‑year dividend history. The company’s P/B of 0.76 and FCF yield of 5.0 % make it a “cheaper” relative to the sector. Its debt load is moderate (D/E = 0.45). The article highlights Southern’s focus on expanding solar capacity and its strategic investments in the “energy transition” space.

3. Risk Signals & Mitigations

The author does not shy away from discussing the caveats. For each pick a few red‑flag points are listed:

• Regulatory Risk: Utility companies can face tariff changes or stricter emissions rules.
• Commodity Price Exposure: Energy firms like NRG and Southern are sensitive to natural‑gas prices.
• Dividend Sustainability: A payout ratio above 60 % (Altria) suggests limited room for cuts if earnings dip.
• Interest‑Rate Sensitivity: Higher rates can inflate the cost of capital, impacting the value of utilities and energy firms.

To hedge these risks, the author recommends:

1. Diversification across sectors (utilities, energy, consumer staples).
2. Monitoring free‑cash‑flow and earnings growth quarterly.
3. Staggering entry points to capture different valuation waves.

4. Take‑away for the Income‑Seeker

The article’s central thesis is that you do not have to sacrifice security for high yield. By applying a rigorous filter that checks both fundamental health and valuation, it is possible to identify high‑yielding stocks that are also cheap relative to their long‑term averages. Each of the five picks offers:

• A sustainable dividend supported by solid free‑cash‑flow.
• A valuation discount that provides a margin of safety.
• A diversified business model (utilities, renewable energy, consumer staples) that reduces the concentration of sector risk.

For an income‑focused portfolio, the article suggests a tactical approach: buy each stock at a 10–15 % discount to its 52‑week high, and hold through at least a full fiscal year to capture any dividend hikes or share‑price appreciation.

5. Conclusion

While a 9 % yield may sound almost too good to be true, the Seeking Alpha piece provides a disciplined framework that demonstrates how those figures can be achieved without courting excessive risk. By focusing on yield, sustainability, valuation and dividend history, the five stocks identified offer a credible path to a higher income floor in a market where many investors are content with 3‑4 % yields.

As always, the “cheapest” price point is just one part of a long‑term strategy; diligent monitoring of earnings, cash flow and regulatory developments remains essential. For investors looking to increase their passive income while keeping downside exposure in check, these five utilities and energy names deserve serious consideration.