Investing $10,000 in Each of These 5 Ultra-High-Yield Dividend Stocks Could Make You Nearly $4,000 in Passive Income

Investing in stocks and farming are similar in some ways. Farmers plant seeds in hopes that they’ll grow and produce plenty of fruit. Investors essentially do the same thing.

But buying stocks can be much easier than farming, which requires a lot of hard work. And the right stocks can produce “fruit” regularly that allows you to kick back and watch the money flow in. What are some good stocks to buy? Investing $10,000 in each of these five ultra-high-yield dividend stocks could make you nearly $4,000 in annual passive income.

1. Ares Capital

Ares Capital (NASDAQ: ARCC) is the largest publicly traded business development company (BDC). It focuses primarily on providing financing alternatives to the upper end of the middle market. The BDC industry has grown significantly because many banks have shied away from these opportunities.

As a BDC, Ares Capital must return at least 90% of its taxable income to shareholders in the form of dividends. With its dividend currently yielding 9.5%, investing $10,000 in the stock would generate $950 in annual passive income.

You should be able to count on this dividend income. Ares Capital continues to generate solid profits and has paid stable or increasing dividends every quarter for 14 consecutive years.

2. Energy Transfer

Energy Transfer (NYSE: ET) is a large midstream energy company that operates pipelines, storage facilities, and more. It has grown both organically and through acquisitions, most recently closing on the buyout of Crestwood Equity Partners in November 2023.

The company’s distribution yield stands at 8.6%. If you invested $10,000 in Energy Transfer, you would rake in $860 in passive income over a year at that level.

Income investors looking to buy and hold will probably like Energy Transfer. The limited partnership (LP) expects to increase its distribution by 3% to 5% annually over the long term.

3. Enterprise Products Partners

Enterprise Products Partners (NYSE: EPD) is another midstream energy leader that’s a great pick…