Volatility has started to rear its ugly head again. Fears of trade wars and rising interest rates have left many investors feeling apprehensive. A great way to beat back increased risk is by buying stocks that pay out handsome dividends -- whether because of a recent pullback in share price or a stable business model that makes a lot of excess cash. These three Motley Fool contributors think that Cypress Semiconductor (NASDAQ:CY)Kinder Morgan (NYSE:KMI), and Hanesbrands (NYSE:HBI) are three down-on-their-luck stocks that still make for a great payday.

A contrarian tech play

Nicholas Rossolillo (Cypress Semiconductor): Technology stocks have been among the best performers out there this year, but some semiconductor stocks have been an exception. Headwinds have been diverse, including potential collateral damage from tariffs imposed by a U.S.-China trade spat, worry that memory chip demand will slow in 2019, and industry downgrades from Wall Street analysts.

Cypress Semiconductor is one of those chip manufacturers that has been swept up by those concerns. A return in 2018 of more than 20% has been completely erased in recent months from the aforementioned fuss. That's because about half of the company's sales are derived from China (where many final products are assembled) and 41% of product is in the memory chip segment.

Negativity aside, Cypress' business remains on solid footing. Management forecast that revenue will accelerate during the third quarter of 2018 -- 8% to 13% higher than last year. That is expected to lead to higher profitability, and after the stock's recent tumble, forward price to earnings sits at a lowly 9.9.

That's a bargain for a company that is posting solid growth. While the memory division will likely contract in the years ahead, Cypress thinks its connectivity chip segment will grow 16% to 18% a year through 2021 and its microcontrollers and programmable solutions 5% to 7% a year. That averages to 7% to 9% total expected revenue growth each year in the next four years, which should underpin the chipmaker's strategy of boosting operating profitability and getting debt paid down.

Plus, along the way investors get treated to a dividend -- a rarity in the technology space. Cypress Semiconductor stock currently yields 3%.

A strong business and a weak stock make for a great opportunity

Chuck Saletta (Kinder Morgan): In 2014, pipeline giant Kinder Morgan delivered $4.6 billion in cash from operations. Its shares finished that year at $42.31. Over its past four reported quarters, Kinder Morgan delivered $4.9 billion in cash from operations, but its shares recently traded hands at $18.21. Its operations are at least as strong now as they were then, but its shares have been cut by more than half.

The reason for that decline is the fact that in 2015, Kinder Morgan was forced to cut its dividend to protect its balance sheet after a rating agency threatened to cut its debt rating due to its leverage. While the dividend cut spooked income-oriented investors who had relied on its shares for regular cash infusions, the company used the improved corporate cash flow to clean up the balance sheet.

Through directing its cash flows and asset sales, Kinder Morgan's balance sheet is now far healthier today than it was in 2014 and 2015. It has begun restoring its dividend and expects to reach a dividend of $1.25 per share annually in 2020. At its recent price of $18.21, that represents an anticipated yield on today's cost of nearly 6.9%, just over a year from now.

The company's executive chairman Richard Kinder recently bought 500,000 shares, reflecting his belief in the business' ability to execute in the future. Knowing as he does how hard the company's shares can fall if it doesn't meet its dividend expectations, that purchase is a substantial vote of confidence that the dividend will actually materialize. With a dividend hike to $1.00 annualized expected in 2019 on that road to $1.25, now looks like a great time to consider buying at a still-reasonable price.

A field of oil pipes while the sun sets on the horizon.

Image source: Getty Images.

Be greedy when others are fearful

Daniel Miller (Hanesbrands): Hanesbrands, a leading marketer and manufacturer of innerwear and activewear apparel with brands including Hanes and Champion, among many others, has had a rough year. In fact, the stock is down roughly 27% year to date alone. A couple of months ago, Hanesbrands shares plummeted 18% due to weaker-than-expected earnings and negative news from Target. However, with its stock trading at a modest nine times forward price-to-earnings ratio and a juicy 3.2% dividend yield, October could be a good time to scoop up shares on the cheap ahead of its third-quarter conference call.

One of the biggest anchors on Hanesbrands' stock price was news that Target, which is pushing more exclusive private-label brands as a new strategy, was dropping Hanesbrands' C9 by Champion athletic apparel. It was a partnership that had been intact for 15 years, and the retailer will officially stop carrying the Champion gear when the contract ends in 2020. Target has been exclusively selling the C9 line, and it generated $380 million of revenue for Hanesbrands over the past year. 

Despite the 18% sell-off, and the larger sell-off year to date, the Target news won't impact near-term results as the contract is alive until January 2020 and management noted that it wouldn't lower its goal for the C9 by Champion brand to reach $2 billion in sales by 2022. Investors should also note that this is a risky move by Target, and if its private-label brands fail to connect with consumers, it could be forced to rebalance the number of private-label products and bring back in national brands, such as C9 by Champion. 

Much of the negative news seems priced into Hanesbrand stock -- Morningstar.com estimates that it trades at a 32% discount -- giving investors a chance to scoop up shares in October ahead of its third-quarter conference call. There's even reason to believe that Hanesbrands' free cash flow could surge through 2022 enabling it to double its dividend. Ultimately, if the company can provide investors with solid results and a confident vision for not only its C9 by Champion brand but its many leading brands, it could start a rebound for an oversold dividend stock.

Chuck Saletta owns shares of Kinder Morgan and Target and has the following options: long January 2020 $20 calls on Kinder Morgan, short January 2020 $20 puts on Kinder Morgan, and short December 2018 $18 puts on Kinder Morgan. Daniel Miller has no position in any of the stocks mentioned. Nicholas Rossolillo owns shares of Cypress Semiconductor. The Motley Fool owns shares of and recommends Kinder Morgan. The Motley Fool recommends Cypress Semiconductor. The Motley Fool has a disclosure policy.