7 best cheap dividend stocks under $10:
- Annaly Capital Management Inc. (NLY)
- Chimera Investment Corp. (CIM)
- Equitrans Midstream Corp. (ETRN)
- Itaú Unibanco Holding SA (ITUB)
- Prospect Capital Corp. (PSEC)
- UWM Holdings Corp. (UWMC)
- Yamana Gold Inc. (AUY)
Tap into yields as high as 20% with these cheap dividend stocks
Finding cheap dividend stocks was a little easier earlier this year. However, there are fewer cheap stocks now than there were previously because the S&P 500 has increased by more than 15% from its summer lows and inflationary fears appear to be subsiding. The following list of seven firms, which all trade for under $10 per share and yield as much as 15% in yearly dividends at present prices, may be of interest to discerning investors who are ready to take on a little extra risk in cheap dividend stocks.
These names face some difficulties in the future, but it is difficult to find a cheap company that is selling at a low value in the midst of sensational headlines. Consider buying one of these inexpensive dividend stocks right away if you aren’t afraid of a little volatility. As of August 22, the trailing 12-month method is used to calculate all dividends.
Annaly Capital Management Inc. (ticker: NLY)
If the name of the company didn’t make it clear, it is an investing firm called Annaly Capital Management. Using mortgage-backed debt and other comparable products, it invests its cash largely in residential and commercial real estate. The stock dropped during the epidemic as investors worried that the market would cool off, but it swiftly recovered.
It has also been under pressure in 2022 due to worries that increasing rates will hurt its business, but as a result of how well it has weathered the storm, it is only down a few percentage points more than the larger S&P 500 index. The cherry on top is a sizable 22 cent quarterly dividend, which results in a mind-blowing yield.
Dividend yield: 13.6%
Chimera Investment Corp. (CIM)
Another specialty finance firm that makes investments in commercial mortgages and residential mortgage-backed securities is Chimera. It functions as a real estate investment trust, or REIT, despite not actually owning any real estate. This unique kind of stock receives advantageous tax status for its business activities but is required to return 90% of its taxable income to its shareholders. That implies a requirement for substantial dividends.
Uncertainty in the housing market and rising rates, which have hampered its operations, have both recently affected CIM’s share price. However, the business is still anticipated to earn $1.38 per share this year, which will more than cover its incredible dividend, which works out to $1.32 per share.
Dividend yield: 15%
Equitrans Midstream Corp. (ETRN)
Due to its “midstream” operations, which are protected from the ups and downs in crude oil markets, ETRN is an appealing but reasonably priced energy company, barely making the cut at $9 and change as of this writing. ETRN runs storage, processing, and pipelines for natural gas. Although it has lower margins than the oil and gas explorers who made money earlier this year as a result of rising energy prices, it is also much less volatile.
Even while other oil sector equities have fallen in value over the past few months, ETRN has registered a modest loss year to date in 2022. That’s because its revenue is consistent, and Equitrans will benefit if and when the economy overcomes its prior inflationary issues and consumption picks up again.
Dividend yield: 6.4%
Itaú Unibanco Holding SA (ITUB)
Although Brazilian bank Ita Unibanco may not be well-known in the United States, at $50 billion it would rank higher than both insurance The Traveler’s Cos. Inc. and Capital One Financial Corp. (COF) in the top 25 U.S. financial firms by market value (TRV). The comprehensive range of business and consumer banking services offered by ITUB includes liability insurance, mortgage lending, credit cards, and checking accounts.
In addition to this local bank’s 36% increase since January 1st, Brazil’s economy has been rebounding in 2022. Even though it doesn’t pay as much in dividends as other companies on this list, its consistent monthly payouts and inexpensive share price make it worthwhile to check into.
Prospect Capital Corp. (PSEC)
A business development company, or BDC, is Prospect Capital. This unique class of stock functions more like a publicly traded private equity firm that makes money through investments and financing decisions than from running a conventional corporation. According to PSEC’s investment strategy, “middle market” businesses with EBITDA between $5 million and $150 million are considered to be eligible.
This covers expansion investments as well as turnaround and bridge transactions for struggling businesses. The 6-cent monthly dividend adds up to an excellent return on top of PSEC’s modest year-to-date loss, but the stock is up an amazing 40% or more from its summer lows.
Dividend yield: 9.1%
UWM Holdings Corp. (UWMC)
UWM Holdings is a residential mortgage lending company that creates loans for homebuyers, including mortgages that are backed by the government through the Federal Housing Administration. UWMC, which was established in 1986 and has its headquarters in Michigan, has developed into the top wholesale mortgage lender in the country, which means that it outsources customer interaction and application processing to a network of independent brokers while handling the loan’s actual transaction.
The main conclusion is that UWMC is a lean organisation that has learned from many previous real estate issues and offers a double-digit yield as a hedge against future volatility, despite concerns of the housing market dropping off.
Dividend yield: 10.6%
Yamana Gold Inc. (AUY)
There is much to be said for investing in a miner like Yamana Gold in a time of raging inflation. The Canadian corporation has 111 million ounces of silver and over 14 million ounces of known gold reserves. Depending on market pricing, manufacturers of precious metals like this one are prone to volatility, but it is evident that the inflation of commodity prices is benefiting this miner.
In addition to the dividend, shares are up roughly 11% year to far, and even if precious metal prices decline, there is still enough gold and silver in the ground to ensure Yamana continues to pay investors for many years to come.
Dividend yield: 2.5%