3 Ultra-High-Yield Dividend Stocks That Yield Over 8% (And Beat the SPY!)

Instead of tossing aside high-yield dividend stocks in favor of the hottest growth stocks, it’s a better idea to hold both, especially if you are older. The market can swing significantly, and the next time the cycle changes, dividend stocks will presumably outperform their growth peers.

Yields on some Treasuries have slipped below 4%, and some companies are now paying over twice that yield. Companies in utilities, financials, and other cash-flow-rich sectors can afford to do this sustainably, and the appeal will only grow as interest rates come down later this year.

Below are three dividend stocks to look into, each yielding over 8%.

Blue Owl Capital (OBDC)

Blue Owl Capital (NYSE:OBDC) is one of the largest business development companies (BDCs) by assets. It makes senior secured loans to private-equity-backed middle-market companies, and it currently manages a portfolio of roughly 236 borrowers.

BDC companies pay some of the highest dividend yields and can do so sustainably by using returns from their loans and investments. Their borrowers pay high interest rates, and this has allowed Blue Owl Capital to post $0.41 in net investment income per share in Q1 2025 vs. dividends of $0.37 per share.

The company posted higher NII figures in recent years, so it has plenty of pent-up undistributed income to rely on if there is short-term underperformance.

Put simply, Blue Owl Capital is earning a double-digit yield on its assets, paying out most of that to shareholders, while keeping debt and credit losses at manageable levels. It’s a very appealing pick in this environment.

The forward dividend yield is 10.13%, with two consecutive years of dividend increases. There are obviously caveats with double-digit yields, which is that the forward payout ratio is 97.48%. This may lead to slight dividend cuts down the line if NII declines, but the yield will remain generous. The 5-year total return (dividends reinvested) of 112.16% beats the SPY’s total.

USA Compression Partners (USAC)

USA Compression Partners (NYSE:USAC) provides natural gas compression services and owns a large fleet of compression units to help with moving gas through pipelines.

The company’s earnings are not affected by the gyrations in the energy market, and this lets it generate stable and consistent cash flow. Revenue mostly comes from long-term fee-based contracts that charge customers a fixed rate regardless of capacity.

The company reported $245.2 million in Q1 2025 revenue, up from $229.3 million in the year-ago quarter. Distributable cash flow also rose to $88.7 million, up from $86.6 million. Distributable Cash Flow Coverage was 1.44x.

Unlike BDCs and financial companies, USAC is a more durable way to derive ultra-high yield dividends. That’s because the clients themselves are quite stable. Midstream companies are its main customers, and the compression services provided by USA Compression Partners are essential.

USAC comes with an 8.69% forward dividend yield. The stock itself is up 109.3% over the past five years. Dividends reinvested, the 5-year total return is 247.37%. That’s almost twice as good as the QQQ.

Ares Capital (ARCC)

Ares Capital (NASDAQ:ARCC) is the largest business development company in the U.S.

The company just reported its Q2 earnings, with core net investment income of $0.50 per share, down from $0.61 a year ago but still ahead of the $0.48 quarterly dividend. GAAP net income was $0.52 per share. The board has now raised or held the regular dividend flat since 2010.

ARCC’s loans are almost all senior secured and first lien, so the average yield on the portfolio remained above 11%.

Analysts are bullish going forward despite the slight miss, as there’s plenty of undistributed income carried over. Plus, the pipeline is expanding again. After a lull tied to tariff-related caution, management says transaction activity is “recovering to pre-tariff levels.” Commitments already signed or in the backlog total about $2.6 billion, which should keep portfolio yields from sliding too far as older loans reprice lower.

ARCC stock comes with a forward dividend yield of 8.51%. It has also received some price target upgrades post-earnings. ARCC stock is up 7.3% in the past year and 62% in the past five years, so the 5-year total return (with dividends) is 159.11%.

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