As we approach the end of 2025, the stock market is showing positive signs with the S&P 500 up 17.3% for the year, heading towards its third consecutive year of gains. Analysts are also optimistic about the market’s performance in 2026, with all 21 surveyed by Bloomberg predicting further growth.
However, such unanimous positivity from analysts can sometimes be a cause for concern. When everyone is in agreement, it begs the question – what could possibly go wrong?
One interesting strategy that has caught my attention is the “Dogs of the Dow” approach, which involves selecting the 10 highest-yielding stocks from the Dow Jones Industrial Average at the beginning of each year. This strategy has seen success in 2025, with a return of 17.8% through December 26.
In light of this, I have decided to take a different approach for 2026 by focusing on stocks that have hit new 52-week lows. By identifying companies with solid fundamentals despite their recent lows, we may uncover potential winners for the upcoming year.
One such stock that stands out is Alexandra Real Estate Equities (ARE), which has hit 35 new 52-week lows and offers an impressive yield of 10.7%. Specializing in office and lab space for industries like life sciences and technology, ARE is strategically disposing of non-core assets to streamline its operations and strengthen its balance sheet.
Another intriguing pick is Flowers Foods (FLO), a long-standing baked goods company with a yield of 9.1%. While facing challenges in organic sales, FLO’s strong brand portfolio and nationwide presence position it well for a turnaround.
Robert Half (RHI) is another stock worth considering, with a yield of 8.6%. As a staffing business navigating a tough employment market, RHI is adapting its strategies to stay resilient and capitalize on opportunities for growth.
Alight (ALIT) is a company focused on employee benefits and financial services, offering a yield of 8.1%. With a pivot towards AI initiatives and a strong cash flow position, ALIT is well-positioned for success in the coming year.
Conagra Brands (CAG) and Americold Realty Trust (COLD) round out the list with yields of 8.0% and 6.9% respectively. Both companies are facing challenges but have potential catalysts for growth in the near future.
Lastly, a special mention goes to Buckle (BKE), a retail company offering a unique dividend strategy with a yield of 8.2%. With a history of rewarding shareholders with special dividends, BKE is a standout in the retail sector.
As we look ahead to 2026, these high-yielding stocks present interesting opportunities for investors seeking value and potential growth in the market. It’s important to conduct thorough research and consider your investment goals before making any decisions. Happy New Year and happy investing!
