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These are three stocks with some of the highest dividend yields. Are they worth investing in?

Jessie Ramsdale
2. 4. 2023
6 min read

High Dividend. Who wouldn't want to get back 10% or even 15% of their investment every year, right? But you might think at first glance that it's not that simple!

This stock has one of the highest dividends

A high dividend is tempting, but you should automatically pay attention. After all, it's rare that an extremely high payout doesn't hide some danger, or at least an upraised finger. It's not necessarily unsustainable, but it will likely require much more care and control on your part.

A dividend is the amount a company pays out to shareholders from its profits. This would sound good on the face of it - it has high profits, so it is doing well. Not necessarily. In fact, a high dividend may indicate that the company has limited opportunities to invest its profits in growth and development.

In addition, a high dividend may also signal that the company may be unsure of its future returns and wants to retain its shareholders. If the company fails to maintain its profitable performance, it may be forced to reduce or even eliminate the dividend, which may have a negative impact on the share price.

Another reason may be the unusually (and probably short-term) good situation in the sector. As an example, take the energy sector this autumn, where the situation unexpectedly improves. It may then pay an extra dividend and that will boost the yield. But such a situation may not last forever. That will be the case for example with $PBR-0.5%, which we will also look at here.

For this reason, investors should carefully consider whether a higher dividend in a given company represents an acceptable risk for them and whether this dividend is sustainable in the long term. A thorough analysis of a company and its sector should be made before deciding to invest in a high dividend stock.

Pioneer Resources$PXD+0.7%

Pioneer Resources is an Australian mining company focused on exploration and production of gold, nickel and copper. It was founded in 2002 and has its main projects in Western Australia, including the Sinclair Nickel Project, which is one of the country's largest and most significant nickel projects.

In addition, Pioneer Resources conducts gold and copper exploration in Western Australia and Queensland. The company prides itself on its advanced technology and innovative approaches to mining, giving it a competitive advantage in the marketplace.

It has one of the highest average dividend payouts in the index based on a trailing 12-month look back. However, these payouts include extraordinary and special dividends that frankly may not realistically last. Keep in mind, however, that there is no guarantee that the large yield will last through 2023.

Petróleo Brasileiro S.A $PBR-0.5%

Petrobras, full name Petróleo Brasileiro S.A., is a Brazilian multinational oil company headquartered in Rio de Janeiro. The company specializes in the extraction, processing and distribution of oil and natural gas, and is one of the largest oil producers and natural gas producers in the world.

Petrobras has extensive oil and gas fields in Brazil and abroad, and owns refineries and distribution networks in Brazil and several countries in Latin America. The company also focuses on the development of alternative fuels and renewable energy sources. Petrobras has faced a number of problems in the past, including corruption scandals and financial difficulties that have led to a decline in its valuation by investors. However, the company has managed to restructure and improve its performance and financial stability in recent years.

Currently, Petrobras is focusing on reducing its costs and improving efficiency, as well as developing its offshore oil fields, which could lead to further growth and improved company performance.

Analysis of Petroleo Brasiliero: Can it maintain a 70% dividend and a P/E below 2?

Overall, Petrobras is a major player in the oil market, with extensive assets and development potential. However, investors should be aware of the risks associated with investing in this company, including the impact of oil and gas prices on its performance, as well as the potential for fluctuations in Brazilian politics and regulations.

I have covered PBR extensively here. In fact, it currently has an incredible dividend of between 50% and 70% and a P/E of under two, which looks incredibly good. However, it's important to keep in mind that due to geopolitics and an above-average past year, these numbers may be heavily skewed.

Its dividend frenzy may be over, assuming the new government focuses on building new refining capacity. Even if the dividend gets cut for one reason or another, shareholders would still be left with dividends well above the market average, it seems .

The company has recently been using its excellent earnings and excess cash flow to retire debt. The company is expected to reduce its debt further if it does not overspend on capital expenditures.

The dividend has jumped quite significantly. But even before that, it wasn't the lowest

The P/E ratio is particularly important here. The P/E is extremely low, currently at just over 1.8. Such a ratio is not just generally low. It is also low in the case of Petrobras, especially if we look at the company's P/E history charts. By the numbers, Petrobras is one of the largest companies with a record low P/E. It is indeed very difficult to find large, profitable and cheap companies these days.

When it comes to the state of the world economy and the future of oil prices, there are many reasons to be concerned. Investor concerns about Brazilian politics may also be justified. At the same time, PBR's financials, its excellent dividend yield and close ties to the Brazilian government can be seen as positives.

Personally, despite the unsustainable dividend situation, I like the company. however, this is an EXTREMELY risky bet and should be kept in mind.

Altria Group Inc. $MO-0.6%

Altria, the company behind Marlboro cigarettes, Black & Mild pipe and cigar products, and Copenhagen and Skoal smokeless tobacco, is a "sin stock" that has posted very reliable earnings despite the fluctuations of the past year. There is not much growth potential in a product category that is undeniably harmful, but it is clear that Altria dominates the U.S. market for those looking for a nicotine fix. And in terms of investment income, the company has seen more than 50 consecutive years of dividend increases, so it boasts a sustainable and generous payout that is very attractive to investors in risk-free quotes. That, coupled with a yield that's about five times that of a typical stock in the S&P 500, makes this dividend stock worthy of attention.

Altria has also been stable over the long term in terms of share price

Do you have a favorite high-yield stock? Or do you prefer to avoid them and go the route of lower and more proven titles instead?

Disclaimer: This is by no means an investment recommendation. It is purely my summary and analysis based on data from the internet and other sources. Investing in the financial markets is risky and everyone should invest based on their own decisions. I am just an amateur sharing my opinions.

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