AI Image Created Under the Direction of Shannon TokheimKey Points
- Amid market volatility expectations, Ryman Hospitality Properties offers an appealing dividend yield, a sizable portfolio of high-demand hotel properties, and 17% upside potential.
- Black Hills offers not only the attractive dividend profile of a stable utilities name, but also the potential for growth through data center business.
- Essential Utilities also capitalizes on the utilities sector dividend strengths as it prepares for a merger that could supercharge earnings and dividend growth.
One of the stories of the market in early 2026 has been the threat of looming volatility. While the S&P itself is trading relatively flat year-to-date (YTD), an incredible surge in the price of gold and silver—coupled with concerns about an international selloff of U.S.-denominated assets—has many investors worried about downside risk. Add simmering geopolitical tensions both domestic and abroad and you have a recipe for potential volatility in stock prices.
At this time, investors seeking a more defensive approach might consider a number of stocks that offer high dividend yields, thereby possibly offering some protection thanks to regular distributions. The companies below all fit that bill while also earning optimistic ratings from analysts across Wall Street as an added bonus.
A Unique and Stable Corner of the Hotel Market Helps Ryman Offer Solid Dividends
A real estate investment trust (REIT) focused on large, convention center-style hotels and resorts, Ryman Hospitality Properties Inc. (NYSE: RHP) is obligated to pay out the vast majority of its income in the form of dividends to shareholders. As a result, it has a high dividend yield of 5.07%. It is able to back this up with a strong cash position: as of the latest reported quarter, RHP had $483 million in unrestricted cash and close to $1.3 billion in total liquidity.
Post-pandemic, demand for RHP's large hotels has been strong and stable. The company also has a hefty block of close to eight million group room nights, providing it a position in the market that is hard for competitors to challenge. This capacity should also help to continue to grow revenue following its most recent 7.7% year-over-year (YOY) improvement in the third quarter of 2025.
It makes sense, then, that analysts see RHP as a good defensive play for investors seeking dividend income. Wall Street expects the firm to boost earnings by more than 9% in the next year and to grow its share price by nearly 17%.
Black Hills Combines Utilities Stability With Data Center Growth Opportunities
Black Hills Corp. (NYSE: BKH) is a regulated utility company offering electric and natural gas service to customers in South Dakota and nearby states. Like many utilities firms, it can be a defensive option when markets become choppy thanks to steady, reliable business. Similarly, it pays out an attractive dividend yield of 3.71% alongside a sustainable dividend payout ratio of 68.18%. The company even recently announced a 4% increase to its quarterly dividend, raising it to $0.703 per share, as a bonus for preexisting shareholders.
One of the reasons analysts may see Black Hills standing out compared to other utilities plays is its potential in the high-growth data center world. The company has multiple years of history providing data center capacity to companies operating in remote areas including in Wyoming. In its latest earnings report, Black Hills announced that it had seen more than three gigawatts of potential demand from prospective contracts. It also has a $4.7-billion capital plan that will help to facilitate Black Hill growing its infrastructure to meet this growing demand.
Three out of four analysts see Black Hills as a Buy, despite minimal upside potential at this point following a rally of 24% in the last year. With a strong dividend, though, investors may be interested in BKH even if its near-term price growth potential isn't significant.
A Potential Undervalued Play With a Major Merger On the Horizon
Another utility play, Essential Utilities Inc. (NYSE: WTRG), focuses on water and natural gas services. The company is fresh off of an announcement last fall that it would merge with American Water Works Co. Inc. (NYSE: AWK) to form one of the largest U.S. water and wastewater services firms. The deal should be complete by early 2027 and should generate up to 9% annual earnings per share (EPS) and dividend growth.
With a dividend yield of 3.55%, Essential is already a strong dividend play, and the prospect of future growth only makes it more appealing. Analysts also expect shares to rise in the meantime, forecasting upside potential of more than 12%. Further, now may be a time to look at WTRG shares given their valuation relative to other companies in the utilities sector: WTRG has a P/E ratio of 16.1, well below the sector-wide average of 24.2.
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Companies Mentioned in This Article:| Company | Current Price | Price Change | Dividend Yield | P/E Ratio | Consensus Rating | Consensus Price Target |
|---|
| Ryman Hospitality Properties (RHP) | $94.62 | -0.1% | 5.07% | 25.03 | Moderate Buy | $110.27 |
| American Water Works (AWK) | $127.52 | -1.2% | 2.60% | 22.41 | Hold | $140.89 |
| Black Hills (BKH) | $72.70 | -0.4% | 3.71% | 18.36 | Moderate Buy | $75.67 |
| Essential Utilities (WTRG) | $38.38 | -1.1% | 3.57% | 15.92 | Hold | $43.29 |
About Nathan Reiff
Experience
Nathan Reiff has been a contributing author for DividendStocks.com since 2024.
- Professional Background: Nathan Reiff is a financial writer and analyst with more than a decade of experience investing and studying the markets through self-guided learning and educational resources from DividendStocks.com and beyond. He began his career in the SEO and cryptocurrency sectors before expanding into general finance and equity research as his interest in investing deepened.
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Education
Doctor of Musical Arts, Yale University, New Haven, Connecticut; Bachelor of Arts, Yale University, New Haven, Connecticut; Master of Music, University of Michigan, Ann Arbor, Michigan