Ares Capital’s total return has outperformed the market over the long term and should continue to do so.
Enbridge offers an attractive dividend, solid growth prospects, and stability.
Enterprise Products Partners is another resilient energy stock with a juicy and growing distribution.
10 stocks we like better than Enterprise Products Partners ›
I probably don’t fit the stereotype for someone who invests in stocks that pay exceptionally high dividend yields. I do not depend on my investments for income. I’m not planning to do that in the near future either.
However, my portfolio includes several ultra-high yielding dividend stocks. And I am adding to my positions in several of them. Here’s why I’m buying these three ultra-high-yielding dividend stocks heading into 2026.
Image source: Getty Images.
Ares Capital(NASDAQ: ARCC) is the largest publicly traded business development company (BDC). Its investment portfolio currently includes 587 companies, with almost a quarter of them in the software and services industry.
I am continuing to increase Ares Capital shares largely due to its attractive forward dividend yield of 9.5%. I like this juicy dividend because it should help BDC stock deliver market-beating total returns.
That’s what happened in the long run. Since its inception in 2004, Ares Capital’s total returns have easily beaten those of S&P 500(SNPINDEX: ^GSPC). I am concerned that this trend was not sustained in 2025? No. Ares Capital appears to be well positioned for the future.
The private loan market is growing. Ares Capital’s reputation, industry relationships and access to capital make it a source of financing for many middle market companies. I expect BDC’s investment approach will allow it to continue to make smart decisions that reward shareholders.
I am an optimist by nature. However, the strong market valuation and economic uncertainty are combining to make me more cautious than usual about which stocks to buy. Enbridge(NYSE: ENB) it is an ideal stock to buy, as it balances my optimism with my caution.
This energy company pays a forward dividend yield of 5.9%. In addition, it has strong growth prospects, particularly with increasing demand for natural gas as new data centers are built and as coal-fired power plants convert to natural gas.
Enbridge projects approximately $50 billion of growth opportunities through 2030. Almost half of them (about $23 billion) are for its gas transmission business.
The stock also satisfies my cautious side. Enbridge is the largest natural gas utility in North America based on volume. That’s as stable a business as you’ll find. Its 18,085 miles of crude oil pipeline and 70,140 miles of natural gas pipeline (including pipe owned by its DCP Midstream joint venture) generate steady cash flow.
Management describes Enbridge’s business model as “low-risk” and “utility-like.” I agree. Combined with its extraordinary dividend (which has risen for 30 consecutive years, by the way) and its attractive growth prospects, Enbridge is the kind of stock that perfectly aligns with my current investment goals.
My reasons for buying Enterprise Products Partners(NYSE: EPD) they are similar to why I am buying Enbridge. Enterprise is another midstream energy leader. It operates more than 50,000 miles of pipeline, storage facilities that hold more than 300 million barrels of liquids, and other energy infrastructure assets.
This limited liability partnership (LP) pays a quarterly distribution that yields 6.8%. Enterprise Products Partners has increased its distribution for 27 consecutive years. I don’t expect this impressive streak to end anytime soon.
Many of the same tailwinds that benefit Enbridge should also help Enterprise Product Partners. Demand for natural gas is increasing, driven by the growing adoption of artificial intelligence (AI) applications and other factors. Rising exports of crude oil, natural gas, ethane and liquefied petroleum gas (LPG) produced in the United States should also boost the Enterprise’s revenue.
Enterprise Products Partners offers stability as well. The LP has a long track record of generating reliable cash flows and double-digit returns on invested capital (ROIC). Some ultra-high yield dividend stocks are risky propositions, but I don’t think Enterprise is one of them.
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Keith Speights holds positions in Ares Capital, Enbridge, and Enterprise Products Partners. The Motley Fool has positions in and recommends Ares Capital and Enbridge. The Motley Fool recommends Enterprise Products Partners. The Motley Fool has a disclosure policy.
Why I’m Buying These 3 Hand Over Fist Ultra High Yield Dividend Stocks for 2026 was originally published by The Motley Fool
