10 Extreme Dividend Stocks With Upside Potential

1. Vale S.A. (NYSE:VALE)

Upside Potential as of August 14: 51.33%

Dividend Yield as of August 14: 12.10%

A Brazilian multinational mining company, Vale S.A. (NYSE:VALE) tops our list of the best dividend stocks. The company’s performance remained robust in the second quarter of 2024, partly due to changes in its leadership team. Shaun Usmar was appointed as the new CEO to lead the copper and nickel business, bringing with him extensive mining experience and strategic insight.

Vale S.A. (NYSE:VALE)’s operational performance has remained strong each quarter. In its Iron Ore Solutions segment, the company reached record-high production for the second quarter since 2018. As part of its strategic goal to become the preferred supplier for low-carbon steel, the company is making progress on major growth projects like Vargem Grande and Capanema, which are expected to add 30 million tonnes of capacity over the next twelve months. Additionally, the company is pleased to announce a new partnership under its Mega Hubs strategy, which further enhances its position as a competitive supplier of direct reduction products. In the second quarter of 2024, the company generated over $9.9 billion in revenues, showing a 3% growth from the same period last year.

Vale S.A. (NYSE:VALE) has always remained committed to its shareholder obligation. During the quarter, the company allocated $114 million to its fourth buyback program. As of July 26, this buyback program was 22% completed, with 33.1 million shares repurchased. Moreover, $1.6 billion in interest on capital is set to be paid in September 2024, in line with the company’s minimum dividend policy applied to the first half of 2024 results. The stock supports a dividend yield of 12.10%, as of August 14.

While we acknowledge the potential of VALE as an investment, our conviction lies in the belief that some deeply undervalued dividend stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued dividend stock that is more promising than VALE but that trades at less than 7 times its earnings and yields nearly 10%, check out our report about the dirt cheap dividend stock.

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Disclosure: None. This article is originally published at Insider Monkey.