Want $5,100 in Dividend Income? Invest $50,000 in These 5 Ultra-High-Yield Stocks

Income investors know that it takes money to make money. You can't generate significant dividend income without investing a hefty amount up front. However, some stocks pay much higher dividends than others.

Would you like to make $5,100 in dividend income over the next 12 months? Consider investing $50,000 spread equally across these five stocks.

The high five

Making $5,100 in dividend income from an initial investment of $50,000 might seem impossible, but it's not. The following five stocks could help you make it happen.

1. Ares Capital

Ares Capital (ARCC 0.39%) is the largest publicly traded business development company (BDC). BDCs provide financing for small to medium-sized businesses. Ares especially focuses on lending to the middle market. Its portfolio is much more diversified than most of its peers. As a result, Ares Capital's track record is better than most BDCs. The company has paid a stable or growing dividend for over 13 years while delivering market-beating total returns.

2. Enterprise Products Partners

Enterprise Products Partners (EPD -0.31%) ranks as one of the top midstream energy companies. It operates over 50,000 miles of pipelines, plus other assets, including 29 natural gas processing plants and 20 deepwater docks. The company has increased its dividend for 24 consecutive years.

3. Devon Energy

Devon Energy (DVN 0.84%) is an oil producer with a unique fixed-plus-variable dividend. The variable component of its dividend is funded by excess free cash flow. Devon has paid a dividend for 30 consecutive years.

4. Innovative Industrial Properties

Innovative Industrial Properties (IIPR 2.21%) is a real estate investment trust (REIT) that leases properties to U.S. cannabis operators. The company has increased its dividend by a whopping 620% over the last five years. Although IIP's share price has fallen significantly since late 2021, it has still more than doubled over the last five years.

5. Medical Properties Trust

Medical Properties Trust (MPW 2.65%) is also a REIT, but it leases properties to hospital operators. The company ranks as one of the world's largest hospital real estate owners, with 444 facilities in 10 countries.

Counting to $5,100 (and higher)

If you invested $10,000 in each of these five stocks, you could easily get to $5,100 in dividend payments over the next 12 months. Here's how:

Data source for dividend yields: Google Finance. Calculations by author.

Based on these stocks' current dividend yields, you'd receive well over $5,100 in dividends from an initial total investment of $50,000.

Potential flies in the ointment

Is such a high level of dividend income guaranteed? Unfortunately, the answer is no.

It's possible that one or more of these five companies could cut their dividends. The variable portion of Devon's dividend fluctuates based on the company's excess free cash flow. Devon has reduced its dividend payout a couple of times in recent months because its free cash flow declined.

Innovative Industrial Properties and Medical Properties Trust both have tenants facing financial challenges. Should conditions deteriorate for their tenants, either or both of these REITs could be forced to cut their dividends.

There is reason to be cautiously optimistic, however. Oil prices seem likely to rally this summer with increased demand and lower supply resulting from Saudi Arabia's production cuts, which could boost Devon's dividend and share price. Also, the financial outlook seems to be improving for hospital operators. That could give Medical Properties Trust some breathing room to sustain its current dividend.

In addition, if any of these stocks fall significantly, the declines could wipe out any income you receive if you sell the stocks. This is a real risk investors shouldn't ignore for these five stocks. It's important, therefore, to make sure your portfolio is well-diversified.