Top High-Yield Stocks: Stable Investment Choices
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy BTI?
Source: Fool
- British American Tobacco: British American Tobacco (BTI) offers a 5.5% dividend yield, and despite declining cigarette volumes, its smokeless portfolio now accounts for over 18% of total revenue, indicating strong growth potential; the company aims to reduce its leverage to between 2 to 2.5 times by year-end, enhancing its appeal as a stable dividend stock.
- Verizon Communications: Verizon (VZ) boasts a 5.6% dividend yield and is shifting from a technology-driven approach to a customer service-focused strategy, which is expected to reduce churn and drive growth; the company is also executing a $25 billion stock buyback, bolstering its financial stability and shareholder returns.
- Realty Income: Realty Income (O) is known for its 5.3% dividend yield and has raised its dividend for over 30 consecutive years, with its core business leasing properties to recession-resistant retailers; as interest rates and cap rates decline, the value of its real estate portfolio is expected to increase, further enhancing its investment appeal.
- Energy Transfer: Energy Transfer (ET) offers a 7% dividend yield and operates one of North America's largest midstream systems, with several large growth projects underway to meet rising natural gas demand; the company anticipates growing its payout at a rate of 3% to 5% moving forward, showcasing strong growth potential.
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Analyst Views on BTI
About BTI
British American Tobacco p.l.c. is a global multi-category consumer goods business company. The Company provides tobacco and nicotine products. Its segments include the United States, Asia Pacific Middle East and Africa, and Americas and Europe. Its product categories include Vapor, Heating Products (HPs), Modern Oral, Traditional Oral, and Combustible cigarettes. Vapor products are handheld, battery-powered devices that heat a liquid to produce an inhalable aerosol, known as vapor. HPs are devices that use heat to generate a nicotine-containing aerosol, which the user inhales. This category includes Tobacco Heated Products and Herbal Products for Heating (HPH). Modern Oral products are smoke-free oral nicotine products called nicotine pouches, designed for use in the mouth. Traditional oral products include snus and snuff. Its brands include Vuse, glo, Velo, Grizzly, Dunhill, Kent, Lucky Strike, Pall Mall, Rothmans, Newport, Natural American Spirit, Camel, and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Tobacco Industry Faces Challenges and Transformation
- Cigarette Volume Pressure: The tobacco industry is facing significant challenges with a notable decline in cigarette sales due to inflation and changing consumer preferences, with traditional cigarettes still being a major revenue source, making the ongoing sales decline a considerable threat to the industry.
- Cost Increase Risks: Industry participants are under pressure from high costs associated with key inputs such as tobacco leaf, energy, and labor, while simultaneously increasing investments in the research, development, and commercialization of smoke-free products, further squeezing profit margins.
- Popularity of Smoke-Free Products: With rising health awareness and stricter regulatory frameworks, consumers are increasingly shifting towards smoke-free alternatives like heated tobacco, vapor products, and oral nicotine, driving a gradual transformation in the industry's revenue mix.
- Market Performance Weakness: Despite the tobacco industry growing by 16.1% over the past year, it still underperformed compared to the S&P 500's 18.7% growth, indicating relative weakness within the overall market.
See More
Top High-Yield Stocks: Stable Investment Choices
- British American Tobacco: British American Tobacco (BTI) offers a 5.5% dividend yield, and despite declining cigarette volumes, its smokeless portfolio now accounts for over 18% of total revenue, indicating strong growth potential; the company aims to reduce its leverage to between 2 to 2.5 times by year-end, enhancing its appeal as a stable dividend stock.
- Verizon Communications: Verizon (VZ) boasts a 5.6% dividend yield and is shifting from a technology-driven approach to a customer service-focused strategy, which is expected to reduce churn and drive growth; the company is also executing a $25 billion stock buyback, bolstering its financial stability and shareholder returns.
- Realty Income: Realty Income (O) is known for its 5.3% dividend yield and has raised its dividend for over 30 consecutive years, with its core business leasing properties to recession-resistant retailers; as interest rates and cap rates decline, the value of its real estate portfolio is expected to increase, further enhancing its investment appeal.
- Energy Transfer: Energy Transfer (ET) offers a 7% dividend yield and operates one of North America's largest midstream systems, with several large growth projects underway to meet rising natural gas demand; the company anticipates growing its payout at a rate of 3% to 5% moving forward, showcasing strong growth potential.
See More
Top High-Yield Stock Recommendations
- British American Tobacco Growth: British American Tobacco (BTI) is showing strong momentum in the defensive tobacco sector, with its smokeless product portfolio now accounting for over 18% of total revenue, particularly driven by extraordinary growth in Velo Plus nicotine pouches, despite volume declines in its cigarette business.
- Telecom Transformation: Verizon (VZ) is shifting from a technology-driven approach to a customer service focus, which is expected to reduce churn and drive growth, while the company is also executing a $25 billion stock buyback to enhance shareholder returns.
- REIT Stability: Realty Income (O) has raised its dividend for over 30 consecutive years, with its core business focused on leasing properties to recession-resistant retailers, and is expanding into data centers and industrial sectors to diversify its market and increase its total addressable market.
- Energy Transition Opportunities: Energy Transfer (ET) operates one of the largest midstream systems in North America and is pursuing several large growth projects to meet rising natural gas demand from AI data centers, with plans to grow its distribution at a pace of 3% to 5% moving forward, making it one of the best high-yield stocks in the energy sector.
See More
5 High-Yield Stocks to Protect Your Portfolio During Turbulent Times
Stock Market Trends: The stock market has recently dipped below its 200-day moving average, with the S&P 500 ETF experiencing significant declines, raising concerns about a potential correction as it sits nearly 5% negative year-to-date.
Investor Sentiment: Amidst rising inflation and geopolitical tensions, investors are questioning whether to move to cash or invest in high-yield dividend stocks that can provide income protection during volatile periods.
High-Yield Dividend Stocks: British American Tobacco, Pfizer, Kraft Heinz, Verizon, and MPLX are highlighted as attractive high-yield dividend stocks, offering solid returns and appealing fundamentals, making them suitable for income-focused investors.
Market Uncertainty: The current market environment is characterized by uncertainty, prompting investors to seek defensive stocks that can generate meaningful income while navigating potential downturns.
See More
Smart Investing: Three High Dividend Stocks to Buy Now
- Oil Price Rebound: Occidental Petroleum, despite being affected by recent Middle East conflicts, remains below its 2022 highs with a current market cap of $56 billion and a dividend yield of 1.7%; as oil prices rise, it is expected to generate outsized profits, enhancing portfolio resilience against inflation.
- Digital Banking Recovery: Ally Financial offers a 3.3% dividend yield; although it has not increased dividends in recent years due to rising interest rates, its net income is nearing $1 billion, and management plans to resume stock buybacks, which is likely to drive gradual dividend growth and attract long-term investors.
- Tobacco Industry Transformation: British American Tobacco boasts a 5.4% dividend yield and is actively expanding into new product categories like e-cigarettes and nicotine pouches, with revenue expected to grow 3% to 5% by 2026, positioning it as a strong cash generator in the future.
- Long-Term Investment Value: While Occidental Petroleum, Ally Financial, and British American Tobacco may not be as exciting as today's hottest AI stocks, their stable earnings power suggests they will be excellent dividend stocks for long-term investment portfolios.
See More
SMITH THOMAS W Significantly Reduces Yelp Holdings
- Share Reduction Details: According to an SEC filing dated February 17, 2026, SMITH THOMAS W reduced its position in Yelp by 96,280 shares during Q4, resulting in a $4.09 million decline in value, reflecting both the sale and stock price changes, indicating a cautious outlook on Yelp's future performance.
- Remaining Stake Proportion: After the reduction, SMITH THOMAS W's remaining stake in Yelp constitutes only 0.22% of its 13F AUM, suggesting a significant loss of confidence in Yelp's investment potential, which may influence market perceptions of the company.
- Top Holdings Analysis: As of February 17, 2026, SMITH THOMAS W's top holdings include CACC valued at $42.08 million (38.9% of AUM), W at $23.81 million (22.0% of AUM), and BTI at $22.51 million (20.8% of AUM), demonstrating a diversified investment strategy and preference for other companies.
- Yelp Market Performance: As of February 17, 2026, Yelp's stock price stood at $20.68, down 45.7% over the past year, underperforming the S&P 500 by 56.53 percentage points, reflecting the challenges it faces in a competitive market environment.
See More
Tobacco Industry Faces Challenges and Transformation
- Cigarette Volume Pressure: The tobacco industry is facing significant challenges with a notable decline in cigarette sales due to inflation and changing consumer preferences, with traditional cigarettes still being a major revenue source, making the ongoing sales decline a considerable threat to the industry.
- Cost Increase Risks: Industry participants are under pressure from high costs associated with key inputs such as tobacco leaf, energy, and labor, while simultaneously increasing investments in the research, development, and commercialization of smoke-free products, further squeezing profit margins.
- Popularity of Smoke-Free Products: With rising health awareness and stricter regulatory frameworks, consumers are increasingly shifting towards smoke-free alternatives like heated tobacco, vapor products, and oral nicotine, driving a gradual transformation in the industry's revenue mix.
- Market Performance Weakness: Despite the tobacco industry growing by 16.1% over the past year, it still underperformed compared to the S&P 500's 18.7% growth, indicating relative weakness within the overall market.
See More
Top High-Yield Stocks: Stable Investment Choices
- British American Tobacco: British American Tobacco (BTI) offers a 5.5% dividend yield, and despite declining cigarette volumes, its smokeless portfolio now accounts for over 18% of total revenue, indicating strong growth potential; the company aims to reduce its leverage to between 2 to 2.5 times by year-end, enhancing its appeal as a stable dividend stock.
- Verizon Communications: Verizon (VZ) boasts a 5.6% dividend yield and is shifting from a technology-driven approach to a customer service-focused strategy, which is expected to reduce churn and drive growth; the company is also executing a $25 billion stock buyback, bolstering its financial stability and shareholder returns.
- Realty Income: Realty Income (O) is known for its 5.3% dividend yield and has raised its dividend for over 30 consecutive years, with its core business leasing properties to recession-resistant retailers; as interest rates and cap rates decline, the value of its real estate portfolio is expected to increase, further enhancing its investment appeal.
- Energy Transfer: Energy Transfer (ET) offers a 7% dividend yield and operates one of North America's largest midstream systems, with several large growth projects underway to meet rising natural gas demand; the company anticipates growing its payout at a rate of 3% to 5% moving forward, showcasing strong growth potential.
See More
Top High-Yield Stock Recommendations
- British American Tobacco Growth: British American Tobacco (BTI) is showing strong momentum in the defensive tobacco sector, with its smokeless product portfolio now accounting for over 18% of total revenue, particularly driven by extraordinary growth in Velo Plus nicotine pouches, despite volume declines in its cigarette business.
- Telecom Transformation: Verizon (VZ) is shifting from a technology-driven approach to a customer service focus, which is expected to reduce churn and drive growth, while the company is also executing a $25 billion stock buyback to enhance shareholder returns.
- REIT Stability: Realty Income (O) has raised its dividend for over 30 consecutive years, with its core business focused on leasing properties to recession-resistant retailers, and is expanding into data centers and industrial sectors to diversify its market and increase its total addressable market.
- Energy Transition Opportunities: Energy Transfer (ET) operates one of the largest midstream systems in North America and is pursuing several large growth projects to meet rising natural gas demand from AI data centers, with plans to grow its distribution at a pace of 3% to 5% moving forward, making it one of the best high-yield stocks in the energy sector.
See More
5 High-Yield Stocks to Protect Your Portfolio During Turbulent Times
Stock Market Trends: The stock market has recently dipped below its 200-day moving average, with the S&P 500 ETF experiencing significant declines, raising concerns about a potential correction as it sits nearly 5% negative year-to-date.
Investor Sentiment: Amidst rising inflation and geopolitical tensions, investors are questioning whether to move to cash or invest in high-yield dividend stocks that can provide income protection during volatile periods.
High-Yield Dividend Stocks: British American Tobacco, Pfizer, Kraft Heinz, Verizon, and MPLX are highlighted as attractive high-yield dividend stocks, offering solid returns and appealing fundamentals, making them suitable for income-focused investors.
Market Uncertainty: The current market environment is characterized by uncertainty, prompting investors to seek defensive stocks that can generate meaningful income while navigating potential downturns.
See More
Smart Investing: Three High Dividend Stocks to Buy Now
- Oil Price Rebound: Occidental Petroleum, despite being affected by recent Middle East conflicts, remains below its 2022 highs with a current market cap of $56 billion and a dividend yield of 1.7%; as oil prices rise, it is expected to generate outsized profits, enhancing portfolio resilience against inflation.
- Digital Banking Recovery: Ally Financial offers a 3.3% dividend yield; although it has not increased dividends in recent years due to rising interest rates, its net income is nearing $1 billion, and management plans to resume stock buybacks, which is likely to drive gradual dividend growth and attract long-term investors.
- Tobacco Industry Transformation: British American Tobacco boasts a 5.4% dividend yield and is actively expanding into new product categories like e-cigarettes and nicotine pouches, with revenue expected to grow 3% to 5% by 2026, positioning it as a strong cash generator in the future.
- Long-Term Investment Value: While Occidental Petroleum, Ally Financial, and British American Tobacco may not be as exciting as today's hottest AI stocks, their stable earnings power suggests they will be excellent dividend stocks for long-term investment portfolios.
See More
SMITH THOMAS W Significantly Reduces Yelp Holdings
- Share Reduction Details: According to an SEC filing dated February 17, 2026, SMITH THOMAS W reduced its position in Yelp by 96,280 shares during Q4, resulting in a $4.09 million decline in value, reflecting both the sale and stock price changes, indicating a cautious outlook on Yelp's future performance.
- Remaining Stake Proportion: After the reduction, SMITH THOMAS W's remaining stake in Yelp constitutes only 0.22% of its 13F AUM, suggesting a significant loss of confidence in Yelp's investment potential, which may influence market perceptions of the company.
- Top Holdings Analysis: As of February 17, 2026, SMITH THOMAS W's top holdings include CACC valued at $42.08 million (38.9% of AUM), W at $23.81 million (22.0% of AUM), and BTI at $22.51 million (20.8% of AUM), demonstrating a diversified investment strategy and preference for other companies.
- Yelp Market Performance: As of February 17, 2026, Yelp's stock price stood at $20.68, down 45.7% over the past year, underperforming the S&P 500 by 56.53 percentage points, reflecting the challenges it faces in a competitive market environment.
See More
