2 Stocks With High And Growing Dividends For This Market Crash

I love dividends. I realize that this is not a popular point of view these days. I am supposed to embrace the idea that buybacks are better than dividends. After all, buybacks are more tax efficient and increase the value of my existing holdings.

I have nothing against buybacks. I just prefer dividends. I know my circumstances much better than the board of directors of a company I own. When I am paid a dividend, I get to decide what to do with the cash.

I can buy more stock if I want, spend it frivolously on bills and groceries, or be smart and use the money to buy a new book or go to a baseball game.

If the board uses the extra cash to buy stock and the market drops, I am still a net loser. If I am paid a dividend and the market dips, I still have the cash.

In today's market, that's more important than ever.

So, let's take a look at two stocks with high yields that are still growing their payouts.

Dividends can provide income for my retirement if I choose.

These cash payments can often be a hedge or buffer against falling stock prices.

I can sign up for dividend reinvestment in most cases and take advantage of automatic dollar cost averaging.

The cash is mine to use as I choose.

The dividend allows me to share in the growth of my business on my terms, not the terms best suited to the board’s needs.

I also like the fact that paying a dividend makes a huge statement. It tells me the business has paid all the bills, invested in any growth plans, rewarded the executives, and still has more money left over.

A dividend increase says that business is so good the company has more money left this year than it did last year.

There is some debate among investors as to whether we should focus on owning stocks with high dividend yields or stocks that are growing their payout every year.

It is a stupid debate.

The answer is obviously “Both.”

Blue Owl Capital OBDC is a great example of the high-yield and dividend growth combo.

Blue Owl is a business development company that makes loans to middle-market companies.

Blue Owl Capital Corporation is one of the largest publicly traded business development companies (BDCs), recently strengthened by its merger with Blue Owl Capital Corporation II (OBDE).

The combined company now manages over $17.4 billion in investments across 236 portfolio companies, with a focus on senior secured lending. 83% of the portfolio is senior secured and 96% consists of floating-rate debt.

OBDC primarily targets U.S. middle-market companies, partnering with private equity sponsors.

The firm’s credit platform, part of the broader $250 billion Blue Owl asset management ecosystem, gives it powerful origination capabilities. Blue Owl has both deep pockets and lots of resources to source and manage loans.

Blue Owl’s underwriting philosophy emphasizes recurring cash flows, market leadership, and non-cyclicality. Since the inception of its direct lending platform in 2016, it has maintained an average annual loss rate of just 11 basis points—much better than most of its competition, a testament to its disciplined credit approach and robust portfolio monitoring.

At the end of 2024, non-accruals represented just 0.3% of the portfolio at fair value.

The current yield is over 11%, and management has consistently increased the payout.

SunCoke Energy SXC isn’t the kind of name that lights up the screens, but for investors who like their income served hot and contractual, it’s a quietly durable machine.

The stock is currently yielding over 5%.

At its core, SXC is a toll collector on the steel industry’s aging coke supply chain, and in a market increasingly starved for reliable yield, that’s a story worth following.

SunCoke is the largest independent producer of metallurgical coke in North America. With a capacity of 4.2 million tons, it’s a key supplier to integrated steel mills.

Unlike the old-line coal miners, SunCoke’s value is not based on where prices for coal or steel are headed. Nearly 80% of its production is covered under take-or-pay contracts that include pass-throughs for coal costs, taxes, O&M, and regulatory changes.

It’s not glamorous, but it’s cash-flow rich and insulated from price volatility that breaks commodity businesses.

What sets SXC apart is its heat-recovery technology. Their plants are newer, cleaner, and more efficient than the competition, so much so that the EPA’s MACT environmental standard for coke making is based on SunCoke’s process.

This gives them a real regulatory moat as legacy by-product batteries age out.

Roughly 90% of U.S. and Canadian coke capacity outside of SXC is over 30 years old, and over 4.4 million tons of capacity has been shuttered since 2015.

That’s an attrition story SunCoke is well positioned to benefit from without ever needing to build new plants.

Financially, they’re in solid shape. They’ve brought down leverage, maintained $190 million in cash, and have an undrawn $350 million in short-term credit if needed.

In 2024, they generated $96 million in free cash flow, which is more than enough to fund their growing dividend, which now sits at $0.48 per share annually, having doubled since 2021.

Management expects a 2025 free cash flow of $100–$115 million even in a softer coke pricing environment.

It’s dirty and unpopular, but coal still pays dividends, and SunCoke has a fantastic history of increasing the cash to shareholders.

High yield and dividend growth go together like peanut butter and jelly and should be a cornerstone of a long-term portfolio.

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