High-Yield Income Plays: Three Stocks Delivering Double-Digit Returns at 13.6% and Beyond

Why Income Investors Are Turning to High-Dividend Alternatives

The broader stock market presents a challenge for income-focused investors. With the S&P 500 trading at a dividend yield of approximately 1.2%, far below historical norms, savvy portfolio managers are increasingly seeking alternative opportunities. A select group of companies, however, continues to deliver exceptional yields—some approaching 13.6% and higher—making them worth examining for investors who can tolerate elevated risk levels.

Three Income Powerhouses Leading the Pack

AGNC Investment: A 13.6% Dividend Play with Consistent Payments

AGNC Investment (NASDAQ: AGNC) stands out as one of the market’s most generous income sources, currently offering a 13.6% yield that dwarfs traditional S&P 500 returns. As a real estate investment trust, this company pursues a focused strategy centered on residential mortgage-backed securities guaranteed by government-sponsored entities like Freddie Mac.

The mechanics are relatively simple: AGNC acquires pools of mortgage loans and enhances returns through leveraged financing structures, primarily via repurchase agreements. This amplification magnifies both profit potential and risk exposure. The REIT’s current return on equity sits in the mid-to-high teens range, aligning closely with its cost of capital structure—a balance crucial for sustaining its dividend. Since early 2020, AGNC has maintained a consistent monthly payout rate. However, this stability depends on market conditions remaining favorable. Historical precedent shows the company has adjusted its distribution when economic headwinds pressured returns below operational costs, as occurred in 2020.

Delek Logistics: 51 Quarters of Rising Payouts at 10.1%

Delek Logistics Partners (NYSE: DKL), structured as a master limited partnership, provides investors with a 10.1% yield supported by midstream energy infrastructure. The company’s portfolio encompasses pipelines, processing facilities, and storage operations—assets that generate predictable revenue streams backed by long-term commercial agreements.

What distinguishes Delek is its demonstrated commitment to distribution growth: the MLP just extended its streak of consecutive quarterly increases to 51 quarters. This consistency reflects operational strength—the partnership currently expects to generate sufficient cash flow to cover its distribution by 1.3 times over, providing adequate safety margin while reinvesting surplus capital into expansion. Recent initiatives include completing the Libby 2 gas processing facility and expanding water infrastructure through acquisitions. This disciplined reinvestment approach positions the company to sustain both operational expansion and payout increases.

Ares Capital: 16 Years of Stable Distributions at 9.6%

Ares Capital Corporation (NASDAQ: ARCC) rounds out this trio, offering a 9.6% dividend yield through its business development company structure. The firm invests in private-company debt and equity, maintaining exposure across nearly 600 portfolio companies. Secured loans comprise 71% of assets, providing income stability.

The investment track record merits attention: Ares has achieved zero cumulative net realized losses since inception—an exceptional achievement. Quarterly dividend distributions flow from interest and investment gains generated by this portfolio. The company has maintained its current quarterly dividend rate since 2022 while sustaining stable or increasing payments for over 16 consecutive years. Recent capital activity reinforces distribution sustainability: the BDC raised $1 billion in fresh capital during Q3 and committed $3.9 billion toward 80 investment opportunities (35 new companies and 45 existing positions). Simultaneously, it exited $2.6 billion in investments, generating additional deployment capacity for income-generating loans.

Evaluating the Risk-Return Proposition

These three companies collectively demonstrate that substantial income remains accessible in today’s market. AGNC Investment at 13.6%, Delek Logistics at 10.1%, and Ares Capital at 9.6% all boast multi-year track records of dividend consistency or growth. Yet elevated yields inherently reflect elevated risks—interest rate volatility affects mortgage REITs, energy infrastructure depends on commodity cycles and regulatory environments, and private credit faces economic downturn exposure.

For risk-tolerant investors seeking meaningful cash flow, these securities merit portfolio consideration alongside appropriate risk management and position sizing strategies.