Seeking 10% Dividend Yield? Jefferies and BTIG Suggest 2 Dividend Stocks to Buy

TipRanks

Sun, May 11, 2025, 10:48 AM 6 min read

High-yield dividend stocks can be a powerful way to generate steady income – and a few are offering payouts that crush the market average.

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Investment firms Jefferies and BTIG have recently pointed to two such names that stand out. Both offer dividend yields approaching 10% – about seven times higher than the S&P 500 average.

However, diving into high-yield stocks calls for extra diligence. While they can offer attractive income, they may also come with increased risks, such as potential dividend cuts or underlying business challenges.

That’s why we turned to the TipRanks database to see whether the rest of Wall Street is backing these picks. Here’s what we found.

Blue Owl Capital Corporation (OBDC)

We’re starting with a BDC – short for Business Development Company. These companies step in where traditional banks often won’t, offering capital and credit to growing businesses that power the U.S. economy. Blue Owl Capital Corporation (OBDC) is a key player here, providing financing and credit services to the kinds of firms that have long served as the country’s economic engine.

OBDC is managed by Blue Owl Credit Advisors, an arm of Blue Owl Capital Inc., and it specializes in financing middle-market companies. The firm takes a debt-first approach, with a selective eye toward equity, building a portfolio that now spans 236 businesses with a combined fair value of $17.7 billion. The average investment size is $75 million.

Looking at the drill-downs, we find that the company’s portfolio is made up mainly of first-lien senior secured loans, at ~76% of the total. Common equity makes up ~12%, and second-lien senior secured loans make up ~5%. Of the total portfolio, 96.5% of the assets are floating rate, and the remainder are fixed. OBDC invests in a wide range of business sectors, and more than half of its investments are in the Southern and Western regions of the US.

Financially, the company reported adjusted net investment income of $0.39 per share in Q1 2025. That came in below expectations, missing forecasts by 4 cents.

The regular dividend was declared at 37 cents per share, and was accompanied by a supplemental payment of 1 cent per share. The regular dividend annualizes to $1.48 per share and gives a forward yield of 10.7%.

Jefferies analyst Matthew Hurwit covers this BDC, and he is impressed by the company’s potential to deliver returns.