Seeking at Least 10% Dividend Yield? Truist Suggests 2 Dividend Stocks to Buy

The article highlights two high-yield income stocks, NCDL and CHCT, both yielding above 10% with analysts seeing roughly 11% to 19% price upside. NCDL declared a $0.40 quarterly distribution and supports a 10.7% forward yield, while CHCT declared a $0.4775 quarterly dividend for an 11.2% forward yield and continues to grow its medical real estate portfolio. Both names carry Moderate Buy consensus ratings, but the piece is mainly analyst commentary rather than a fresh company-specific catalyst.

Analysis

The common thread is not “high yield” per se; it is the market’s willingness to pay for cash flows that look insulated from a softening rate backdrop. In that sense, NCDL is the cleaner expression of the trade because the dividend reset creates a lower earnings hurdle just as spread compression and floating-rate loan coupons begin to normalize. The second-order benefit is that buybacks can become more accretive when BDCs trade below NAV, so any authorization matters as much as the payout itself.

CHCT is more fragile despite the higher headline yield because the equity is effectively being priced as a levered bond proxy with real asset-level execution risk. The subtle issue is that healthcare real estate is not one monolithic defensive bucket: outpatient and behavioral assets can reprice differently than rehab or inpatient exposures if tenant capital budgets tighten. If equity cost of capital does not improve, growth can become self-defeating, since every incremental acquisition risks diluting rather than compounding.

Consensus appears to be underestimating dispersion between the two names. NCDL benefits if rates drift lower but credit stays orderly; CHCT needs both stable occupancy and cheaper equity funding to sustain its dividend-growth narrative, so it has more ways to disappoint over a 3-6 month window. The market is likely overstating the safety of the 10%+ yield screen, because in both cases the yield is a symptom of balance-sheet sensitivity rather than a free lunch.

Key Decisions for Investors

• Long NCDL vs. short CHCT in equal dollar terms for a 3-6 month horizon: prefer the BDC with clearer dividend coverage and a more credible path to NAV support; target ~10-15% relative outperformance if rates ease without a credit event.
• If initiating NCDL, use pullbacks near book-value discount levels rather than chasing strength; upside is roughly 15-20% over 12 months, but the key risk is a widening in middle-market credit spreads that would pressure distributable income within 1-2 quarters.
• For CHCT, consider a covered-call structure instead of outright long exposure if income is the objective: the premium can offset near-term coverage risk while leaving some upside to a modest re-rating over the next 60-90 days.
• Avoid pairing either name with broad rate-lower beneficiaries until the Fed path is clearer; these are not pure duration trades, and the first-order driver is actually earnings/cash-flow coverage quality, not just yield compression.
• Set a stop on CHCT if leverage or occupancy deteriorates in the next quarterly update; the downside can accelerate quickly if the market loses confidence in dividend growth, making this a 6-12 month operational story rather than a simple yield play.