1 High-Yield Dividend Stock Worth Loading Up On Right Now
Key Points
Black Hills reported 31% Q2 EPS growth on 3% revenue growth, hinting at improving efficiency.
Wyoming data center demand could drive incremental load growth through 2030.
A 3.8% yield and 56-year streak look supported by a 66% payout ratio.
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There's often a catch with "high-yield" dividend stocks: a payout that looks tempting, yet is unsustainable. Case in point: The highest-yielding dividend stock right now is Gmex Robotics Corporation, with a forward yield of 9,514.19%. But yield alone doesn't make a stock worth owning.
Now contrast that with Black Hills Corp. (NYSE: BKH). Investors looking for a company with a long history of dividend growth can still find its yield meaningfully attractive, especially if they're prioritizing safety along with income.
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This unassuming utility provider operates in the Great Plains and Mountain West regions. It sits right in the middle of the biggest market boom in 50 years, delivering impressive returns while paying attractive yields. It's also the highest-yielding dividend stock with a consensus "Strong Buy" rating from Wall Street analysts.
But that begs the question: Is this stock worth owning?
Black Hills' Q2 2026 earnings show steady growth and improving efficiency
Like any good stock story, it starts with the numbers.
In second-quarter fiscal year 2026, revenue rose 3% to $452.8 million. That's modest by most accounts, but considering that GAAP diluted earnings per share jumped from $0.38 a year earlier to $0.50 (+31%), the picture becomes more interesting. It suggests that Black Hills grew earnings far faster than revenue, indicating the company became more efficient and squeezed more profit out of each dollar of sales.
Does the company still have headroom to grow revenue even further? Apparently, yes.
Wyoming's data center demand could extend Black Hills' growth runway
Management has flagged Wyoming as an area of interest because of data center demand. In fact, the state has projected 3 gigawatts of demand, with 600 megawatts already in the company's plans through 2030.
Who's driving that 600-megawatt demand? Microsoft and Meta Platforms, two of the world's biggest artificial intelligence hyperscalers.
That's not to say that all the benefits from Wyoming's demand will happen sometime in the future. According to Black Hills President and CEO Linden R. Evans, the company has "recorded and reliably served 20 consecutive years of increasing peak system loads [in the state], a remarkable 183% increase since we acquired the utility in 2005."
In other words, Black Hills already has a strong foundation for rising electricity demand, and data centers could drive it even higher. That growth has already shown up in the price, which is up 25% in the last year.
At around $72, the stock is trading just 9% below its 52-week high and only 18% below its all-time high, set in 2020.
What Wall Street sees in Black Hills' valuation
Those kinds of numbers tend to spook more conservative investors, but that doesn't seem to be the case here. Right now, Black Hills is trading at a P/E around 18x, compared to the sector median of 19x. P/E, or price-to-earnings, is a valuation metric that compares the stock price to the company's earnings per share. The lower the number, the better. That means Black Hills is a little cheaper than many of its peers in the Utility sector.
Furthermore, Wall Street is rather optimistic about the company, with its rating jumping from Moderate to Strong Buy in the last three months, and the high target price suggests a 21% potential upside in the next 12 months.
Together, we have a strong picture of Black Hills being a good growth investment. But that doesn't necessarily make it a good dividend stock.
The dividend looks attractive, and the payout metrics look manageable
What makes Black Hills a dividend stock worth considering is its 3.8% forward yield and its "Dividend King" status, with more than 50 consecutive years of dividend increases. It also has a reasonable 66% dividend payout ratio, meaning the company pays just over half of its earnings back to shareholders. Those two numbers tell me Black Hills is quite generous, but not so much that it deprives itself of cash to reinvest in the business.
Final take: A safer high-yield dividend stock with a growth narrative
Black Hills Corp shows that safe, high-yield dividend stocks don't always have to be household names to deliver. In this case, earnings are growing faster than revenue, and data centers driving up demand in their key areas point to a long runway ahead.
Sure, the stock price has gone up significantly for a utility company, but it still trades cheaper than its peers, and Wall Street's improving rating is just another sign that the market's starting to take notice.
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Rick Orford has positions in Meta Platforms and Microsoft. The Motley Fool has positions in and recommends Meta Platforms and Microsoft. The Motley Fool has a disclosure policy.
