5 Dividend Stocks Yielding 5% or More to Buy Right Now for Passive Income

Investing in high-yielding dividend stocks can be a great way to generate passive income. While the S&P 500's dividend yield of around 1.2% is near its record low, many companies offer much higher-yielding dividends. Here are five with yields of 5% or more that you can buy right now to generate passive income.

Clearway Energy

Clearway Energy's (NYSE: CWEN)(NYSE: CWEN.A) dividend yield is just over 5%. The clean power company generates very stable cash flow by selling the bulk of its electricity under long-term, fixed-rate power purchase agreements with utilities and large corporations. The company aims to pay out around 70% of its stable cash flow in dividends, while retaining the rest to invest in additional income-producing clean power generation assets.

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The company currently has the financial capacity and secured investments to support its expectations of delivering 7% to 8% compound annual cash flow per share growth through 2030. Meanwhile, Clearway believes it can grow its cash flow by 5% to 8%+ annually in 2031 and beyond. That steady growth should support continued dividend increases.

NNN REIT

NNN REIT (NYSE: NNN) has a more than 5.5% dividend yield. The real estate investment trust (REIT) invests in single-tenant, triple-net-leased (NNN) real estate, primarily retail and service properties (e.g., car washes, convenience stores, and restaurants). These properties produce very stable rental income because tenants cover all property operating costs.

The REIT pays out about 70% of its stable cash flow in dividends, retaining the remainder to reinvest in income-producing retail properties. It also boasts a conservative balance sheet, giving it additional flexibility to invest in new properties. It typically buys properties via sale-leaseback transactions secured through existing tenant relationships. These deals grow its income, enabling NNN REIT to steadily increase its dividend, which it has done for 36 consecutive years.

Oneok

Pipeline giant Oneok (NYSE: OKE) has a 5.5% dividend yield. The company also generates very stable cash flow, with the bulk coming from long-term, fixed-rate contracts or government-regulated rate structures. That has enabled the company to deliver over a quarter century of dividend stability and growth.

Oneok has invested heavily in expanding its midstream operations in recent years, including making several acquisitions. The company is still working to capture several hundred million dollars of cost savings and commercial synergies from these deals. Additionally, it has several organic expansion projects in the backlog, which it expects to complete through the middle of 2028. It has ample financial flexibility to support its growth thanks to its healthy post-dividend free cash flow and a top-notch balance sheet. Oneok's growth drivers and financial strength support its plan to increase its dividend by 3% to 4% annually.

Verizon

Verizon (NYSE: VZ) has a more than 7% dividend yield. The telecom giant generates lots of recurring revenue as customers pay their wireless and internet bills. Verizon uses that money to invest in maintaining and expanding its networks, pay its lucrative dividend, and maintain its strong balance sheet.

The company recently closed its $20 billion acquisition of Frontier to expand its broadband network and enhance its ability to cross-sell mobile and internet services to more customers. That deal strengthens the company's ability to continue growing its already robust cash flows. This continued growth should enable Verizon to support future dividend increases. The company extended its growth streak to 19 years in a row last fall.

VICI Properties

VICI Properties' (NYSE: VICI) dividend yield is over 6%. The REIT supports its payout with the stable cash flows produced by its portfolio of market-leading gaming, hospitality, wellness, entertainment, and leisure destinations. It owns properties secured by long-term NNN leases and invests in loans backed by experiential real estate.

An increasing percentage of VICI's long-term leases escalate rents at rates tied to inflation (46% in 2026, up from 42% last year, and rising to 90% by 2030). The company also routinely invests in additional income-producing experiential properties. Last November, it secured a $1.2 billion sale-leaseback transaction with Golden Entertainment to buy seven gaming assets across Nevada. It also agreed to provide up to $510 million in development funding for a casino in California and invest $450 million into a mezzanine loan to support a luxury mixed-use development project in California. These investments should support continued dividend increases. VICI Properties has grown its payout at a 6.6% compound annual rate since the end of 2018.

Top-notch, income-producing stocks

Clearway Energy, NNN REIT, VICI Properties, Oneok, and Verizon stand out for their high dividend yields. Each company backs its well-above-average dividend with stable cash flows and rock-solid financial profiles. That puts their payouts on a sustainable level, while giving them the capacity to continue expanding their businesses and increasing their dividends. This combination of high yields and growth, backed by lower risk profiles, makes them ideal stocks to buy and hold for passive income.

Matt DiLallo has positions in Clearway Energy, NNN REIT, Verizon Communications, and Vici Properties. The Motley Fool has positions in and recommends NNN REIT. The Motley Fool recommends Oneok, Verizon Communications, and Vici Properties. The Motley Fool has a disclosure policy.