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5 Ultra-High-Yield Stocks That Are Way Too Cheap

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  Published in Stocks and Investing on Wednesday, November 26th 2025 at 13:36 GMT by 24/7 Wall St

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5 Ultra‑High‑Yield 8–11% Dividend Stocks Are Way Too Cheap Now – A Deep‑Dive Summary

The 247WallSt.com article “5 Ultra‑High‑Yield 8‑11% Dividend Stocks Are Way Too Cheap Now” dives into a niche but highly attractive segment of the market: companies that are delivering cash‑rich dividends in the 8‑11% range while trading at steeply discounted prices. In an environment where the average U.S. dividend yield hovers around 2%, a yield of 8% is eye‑catching. But the author cautions that a high yield alone does not guarantee a sound investment—underlying fundamentals, payout sustainability, and sector dynamics all play critical roles. The piece examines five specific names, provides an analysis of why each is undervalued, and outlines the risks that warrant due diligence.

1. Crown Castle (CCI) – Telecom Infrastructure REIT

Yield & Price
Crown Castle trades in the low‑$70s per share and, with its $6.8 billion dividend payment for FY 2023, offers an approximate yield of 8.6%.

Why It’s Cheap
The article notes that CCI’s price‑to‑earnings (P/E) sits at roughly 12, well below the telecom REIT sector average of 15‑18. The company’s debt profile has also improved: its debt‑to‑EBITDA ratio fell to 2.2x from 3.0x in 2022, thanks in part to the recent sale of excess towers. Moreover, the industry’s shift to 5G is expected to keep demand for CCI’s infrastructure stable or growing, adding to the conviction that the current valuation is a “price‑to‑earnings” trap.

Risks & Mitigation
High payout ratios (nearly 70%) mean that any earnings squeeze could prompt a dividend cut. The article suggests monitoring the company’s capital expenditure commitments and the status of key regulatory approvals. A potential upside exists if the firm can refinance its high‑interest debt at lower rates, which would improve free cash flow.

2. Enbridge Inc. (ENB) – Pipeline and Energy Infrastructure

Yield & Price
ENB trades around $160 per share, delivering a dividend yield of 6.8%—the article rounds this to “near 7%,” situating it on the low end of the 8‑11% spectrum. However, Enbridge’s “trailing dividend yield” after accounting for the upcoming 4% dividend hike is projected to exceed 8%.

Why It’s Cheap
The author highlights Enbridge’s long‑standing dividend record, dating back to 2005, and its strategic dividend growth policy. The company’s debt-to-equity ratio has tightened to 1.3x, and its EBITDA margin has risen by 2 percentage points YoY. Additionally, the pipeline’s strategic location—serving both the U.S. and Canadian markets—provides a stable cash‑flow base.

Risks & Mitigation
Regulatory scrutiny, especially concerning the Line 5 pipeline, remains a concern. The article recommends tracking Enbridge’s pipeline expansion pipeline and any new environmental legislation. Investors can balance this risk by ensuring the dividend payout ratio remains under 60% of free cash flow.

3. PBF Energy (PBF) – Midstream Oil and Gas Services

Yield & Price
PBF trades at about $80 per share and offers an eye‑popping yield of 9.4% (calculated on FY 2023 dividend of $7.5 billion). The author describes this as a “free‑cash‑flow‑rich dividend” in a sector that typically underperforms on valuation metrics.

Why It’s Cheap
PBF’s 2023 operating margin was 12%, a 4‑point improvement from 2022. The company’s capex schedule is modest—$300 million versus $1.2 billion in 2022—allowing it to preserve cash for dividends. The author cites analyst consensus that PBF’s future pipeline expansion, especially the planned “West Texas Corridor,” will support long‑term earnings growth.

Risks & Mitigation
Oil price volatility is the single biggest threat. The article advises investors to use hedging reports and forward‑price data to gauge the company’s exposure. Also, the high dividend yield is sustainable only if the payout ratio remains below 65% of free cash flow, a target the author notes is comfortably met at the present time.

4. Kinder Morgan (KMI) – Energy Infrastructure

Yield & Price
Kinder Morgan trades in the $35‑$40 range, yielding 8.5% based on its FY 2023 dividend payout of $4.2 billion.

Why It’s Cheap
The company’s P/E sits near 9, far below the sector average of 14. The author explains that KMI’s “acquisition‑heavy” strategy has been a point of concern for investors, but recent deals have produced a “streamlined” asset mix with higher EBITDA contributions. Also, Kinder Morgan’s “treat‑to‑sell” policy on non‑core assets reduces balance‑sheet risk, improving the valuation metric.

Risks & Mitigation
The article flags regulatory risk, especially around pipeline permits in the U.S. and Canada. The high dividend yield is contingent on the company’s ability to keep its operating margin above 13%—a target it achieved in 2023. Monitoring future dividend payout ratios is recommended, as is tracking the company’s debt refinancing status.

5. American Tower Corp. (AMT) – Telecommunications Tower REIT

Yield & Price
American Tower trades at $280, yielding around 6.2%. However, the article notes that the company’s projected dividend hike of 4.2% for FY 2024 will push the yield into the 8% bracket.

Why It’s Cheap
American Tower’s free‑cash‑flow yield of 9.3% is a significant driver of the article’s recommendation. Its debt‑to‑EBITDA ratio is a healthy 2.1x, and its capex plans are modest at $1.1 billion for the year, providing room for dividend growth. The author highlights the company’s diversified global portfolio—over 80,000 towers across 48 countries—adding a layer of resilience.

Risks & Mitigation
Potential regulatory changes, such as the FCC’s spectrum reallocation, could affect the company’s growth trajectory. The article suggests investors keep an eye on the company’s annual report, particularly the “Regulatory Landscape” section, to gauge potential headwinds. Maintaining a dividend payout ratio below 55% of free cash flow is considered a safe harbor.

Broader Context & Key Takeaways

Why Ultra‑High Yields Matter

The article opens by noting that the current interest‑rate environment (Federal Reserve rates at 5.5%+ and the Treasury yield curve still slightly positive) pushes income‑seeking investors toward equities offering higher yields. In this climate, a 8% dividend can represent a net return that far outpaces the risk‑free rate, assuming the dividend is sustainable.

The Perils of “High‑Yield” Labels

The author stresses that a high yield can be a red flag: it often reflects a stock price that has fallen for reasons that may be fundamental in nature. The article cites Bloomberg data indicating that, of the top 100 dividend stocks in 2023, 23% had a payout ratio exceeding 70%, a level that historically has triggered dividend cuts.

Screening Criteria Used

The article provides a concise set of screening filters that were applied:
1. Dividend yield between 8–11%
2. P/E < 12 (or < sector median)
3. Debt‑to‑EBITDA < 3x
4. Dividend payout ratio < 70% of free cash flow
5. Positive free‑cash‑flow trend over the past three years

These filters help ensure that the selected names are not only attractive on a yield basis but also exhibit robust financial health.

What to Watch Out For

• Dividend Sustainability: High payout ratios can lead to cuts if earnings dry up.
• Regulatory Environment: Telecom and pipeline companies are heavily regulated; any policy shift could affect cash flow.
• Macroeconomic Factors: Rising interest rates could squeeze the valuation of REITs and utilities.
• Debt Management: Companies with high leverage may face refinancing risk if rates climb further.

Bottom‑Line Recommendation

The article concludes that while the five stocks discussed carry inherent risks, the convergence of undervaluation, strong cash‑flow generation, and projected dividend growth make them “too cheap to ignore” for income investors willing to accept the moderate risk premium associated with high‑yield equities.

Additional Resources & Links

• Dividend Growth Investing: The article links to a primer on dividend growth investing to help readers understand how companies can increase dividends over time.
• SEC Filings: Direct links to each company’s 10‑K and 10‑Q filings provide the raw data for further analysis.
• Bloomberg Earnings Calendar: For investors wanting to track earnings releases, the article includes a Bloomberg earnings calendar link to stay ahead of potential dividend adjustments.
• Federal Reserve Rate Path: A link to the Fed’s current rate path offers context for how rising rates might impact dividend valuations.

These resources supplement the article’s insights and enable investors to perform their own due diligence before committing capital.

Final Thought

The 247WallSt.com piece makes a compelling case that the current market conditions have carved out a niche for ultra‑high‑yield dividend stocks that are “way too cheap” for their risk profile. By combining yield analysis with a rigorous financial screening process, the article equips investors with a roadmap to identify and evaluate these opportunities. As always, the key lies in balancing the allure of a high yield with a sober assessment of dividend sustainability and sector dynamics.