When dividend stocks offer high yields of more than 5%, the temptation can often be to assume that they aren't safe. But the yield alone doesn't mean that the payout is unsustainable. A stock could be down for any number of reasons, pushing its yield up in the process.
A couple of dividend stocks that may seem risky at first glance are United Parcel Service (UPS 2.68%) and Verizon Communications (VZ +0.31%). Their yields are well over 5%, but their payouts aren't too good to be true. Here's why they look like great buys today.
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United Parcel Service
Logistics giant United Parcel Service, or UPS, yields 5.6%. That's five times higher than the S&P 500 average of just 1.1%. UPS stock had an even higher yield earlier in the year, but it has come down as its share price has risen by around 19% thus far in 2026.
In January, the logistics giants reported fourth-quarter numbers that beat analyst expectations. The company's adjusted per-share profit of $2.38 for the last three months of 2025 easily surpassed projections of $2.20. Investors were also encouraged that its full-year revenue guidance for 2026 was nearly $2 billion higher than analyst estimates ($89.7 billion versus $87.9 billion). As a result of the strong numbers, the stock has been rallying in the early part of the year.
NYSE: UPS
Key Data Points
The stock's payout ratio is right at 100%, but with UPS focusing on high-value deliveries and strengthening its margins, that should come down in the future. There's some uncertainty with the stock as its performance will depend on the strength of global economies, but it's a relatively safe investment for the long term, and the dividend still looks sustainable.
Verizon Communications
At right around 6%, Verizon offers an even higher yield than UPS. The telecom company's share price has risen by 15% this year as it too has recently delivered some solid quarterly results, which appear to have calmed investor fears about the stock and the overall safety of its dividend.
The company's fourth-quarter results, which covered the last three months of 2025, were encouraging as Verizon's wireless subscriber growth was the highest it's been in six years. And for 2026, it projects adjusted earnings per share to be at least $4.90, while analysts were expecting just $4.76. New CEO Dan Schulman has been working on improving the company's profitability, and the plan appears to be working.
NYSE: VZ
Key Data Points
Verizon's payout ratio is around just 50% as its dividend looks incredibly safe. And the business is also showing encouraging signs of progress. It's been winning over investors, and that trend could continue as the year goes on, as this is a solid income stock to buy right now.
