The S&P 500 index (SNPINDEX: ^GSPC) has a miserly yield of roughly 1%. That fact highlights just how difficult it is to find attractive dividend stocks in 2026. But if you are an income investor, you can still find yield; you just have to do a little digging. However, don’t just examine dividend yield. Pay close attention to the sustainability of the dividend, too.
Enterprise Products Partners (NYSE: EPD), for example, has a lofty 5.6% yield and a distribution growth streak of 27 years. Realty Income‘s (NYSE: O) yield is 4.9%, and its dividend has increased for 31 years. Here’s a look at each of these attractive passive income stocks.
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Enterprise sidesteps commodity risk
Enterprise’s lofty distribution yield is notable given that it operates in the energy sector, an industry known for volatility. But it operates in the midstream segment, which is actually very stable. Essentially, Enterprise owns energy infrastructure assets that transport oil and natural gas worldwide. It charges fees for the use of its assets, so commodity prices aren’t that impactful on its cash flows. That is how it has managed to achieve such an impressive streak of distribution growth.
The downside is that the lofty 5.6% yield will likely account for the lion’s share of an investor’s return over time. The pipelines and storage assets that Enterprise owns are large, time-consuming, and expensive to build. Slow and steady growth is the norm. That said, this particular midstream business also emphasizes fiscal conservatism. It has an investment-grade-rated balance sheet, and its distributable cash flow covers the distribution by a very solid 1.7x.
Most investors should have some exposure to the energy sector, given its importance in the global economy. Enterprise is a great way to do it in 2026, a year marked by energy sector volatility.
Realty Income is built to be boring
Realty Income is the largest net-lease real estate investment trust (REIT), with a portfolio of over 15,500 properties. It focuses on single-tenant retail properties, which make up roughly 80% of its portfolio. This is one of the most liquid areas of the institutional property market. And since the net lease structure requires tenants to pay for most property-level costs, Realty Income’s cost structure and risks tend to be lower than those of REITs that don’t use net leases. The rest of the portfolio is spread across industrial assets and more unique property types, such as casinos and data centers. The company also has notable geographic diversification, with around 20% of its rents coming from Europe.
Like Enterprise, Realty Income is a bit of a tortoise. The 4.9% yield will be a big part of an investor’s return over time. And dividend growth will likely be slow. However, the REIT is highly reliable, noting its 31-year dividend growth streak. It also has an investment-grade-rated balance sheet. That said, being large, reliable, and financially strong gives Realty Income an edge over smaller peers.
REITs have to pay out 90% of taxable earnings as dividends to maintain their REIT status. This results in them having to frequently raise capital in the markets, via stock and bond sales. Companies like Realty Income tend to have an easier time doing that, meaning that its cost of capital is generally relatively low. It may be big and slow-growing, but conservative dividend investors will likely find its advantaged business highly appealing in any market.
Build your income foundation even in a low-yield world
Enterprise and Realty Income are both foundational high-yield investments. Financially strong, boring businesses that just keep spitting out income year in and year out. Although both are slow-growing businesses, they allow you to ramp up your portfolio’s yield. And, for more aggressive investors, they can allow you the leeway to add higher-growth dividend stocks to the portfolio that may have lower yields. In other words, Enterprise and Realty Income should interest all dividend investors, not just those looking to maximize their passive income stream.
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Reuben Gregg Brewer has positions in Realty Income. The Motley Fool has positions in and recommends Realty Income. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.
2 High-Yield Dividend Stocks Worth Buying Before 2026 Ends was originally published by The Motley Fool
Disclaimer : This story is auto aggregated by a computer programme and has not been created or edited by DOWNTHENEWS. Publisher: finance.yahoo.com
