Here are the highest-yielding equity stocks from the FTSE 100 and S&P 500
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When stocks come with a 9% dividend yield, it’s almost always a sign that investors are worried about something. But the market isn’t always fair – and when it isn’t, it can be a huge opportunity.
Both the FTSE 100 as well as S&P 500 have profitable stocks that are currently attracting attention. And investors looking for long-term income should take a closer look at both.
LyondellBasell Industries
At 9.5%, LydonellBasell Industries (NYSE:LYB) has the highest dividend yield in the S&P 500. It’s also a classic for investors – the yield is high because the stock is low, so is the dividend safe?
This company is a chemical business in bad shape. Weak demand due to stagnant industrial activity has limited supply, but the biggest problem has been supply competition from China.
Over the past 12 months, the company’s free cash flow has never been close to enough to cover its dividends. And that means there’s a real risk of under-spreading – and the market knows it.
Profit cuts are not guaranteed, and there are reasons for positivity. The first is that there are signs of recovery in US industrial activity from January’s ISM Manufacturing PMI data.
Source: Trade Economics
The figure reached 52.6, the highest level in three years and a strong sign of growth. And to add more weight to this, the supply side of the equation is starting to improve in China.
The tariff policy has actually forced some of China’s most inefficient factories to close, reducing competition. Given this, I think the 9.5% dividend yield is definitely worth a closer look.
The Admiral
From the FTSE 100, The Admiral (LSE:ADM) is a very different story. The £2.36 a share the company has returned in 2025 is a yield of 8.3% at today’s prices, but that will surely fall in 2026.
The company has announced a change in its dividend policy. Instead of issuing new shares to fund employee compensation, it will use a special dividend to fund this.
That will mean that the return on investment is diminishing going forward. But it doesn’t represent a feeling that business is bad – in fact, it may be the opposite.
Buying your own shares instead of paying dividends can be taxing for investors. And the fundamental strength of the company is the benefit of its underwriting, which cannot be affected by change.
Another risk is that the UK car insurance industry is currently under pressure. Higher maintenance prices and lower premiums are set to weigh on margins, which is why analysts have been downgrading the stock.
They may be right, but I think Admiral is in a better position to weather the recession than most. And while income investors may want to look elsewhere, I’ve started buying stocks from my ISA.
High yield, high risk?
Warren Buffett’s point that investors pay a high price for cheery consistency is absolutely true for dividend stocks. Higher yields almost always indicate concerns about the underlying business.
Sometimes, however, concern may not materialize due to a short-term problem that the market cannot see past. And when that happens, investors can find rare and profitable investment opportunities.
