• Covestro AF (OTCMKTS:COVTY): A leading polymer player with cheap multiples
• Altria (NYSE:MO): Profit margins are expected to increase significantly this year
• Societe Generale (OTCMKTS:SCGLY): Excessive bearish sentiment offers a good entry point into this leading European bank
• Rubis (OTCMKTS:RBSFY): Despite underperforming crude markets, the niche oil company has solid financials
• Engie SA (OTCMKTS:ENGIY): Utility hard hit by rising gas prices, but the group still offers good fundamentals
• BASF (OTCMKTS:BASFY): Dividend distribution is safe, despite a deteriorating cost-structure
• Archrock (NYSE:AROC): Analysts expect weak cash flows in 2022, but the constructive gas market outlook will support operations

Dividend stocks are typically used by investors as a source of passive income on top of capital gains generated by stock increases. The best dividend stocks typically are high-quality companies that have a leading position in their respective markets.

Dividend stocks are also a good way to help investors hedge against inflation. Most of these corporations have a high pricing power that makes it easier to adapt to changing market conditions.

The first quarter of 2022 has been defined by high volatility in the equity market. Some dividend stocks exposed to the geopolitical developments in Eastern Europe have been hit hard and are now offering a good long-term buying opportunity.

Here is a diversified selection of dividend stocks to invest in now, nearly all with an estimated yield of more than 6%.

High Dividend Stocks to Buy: Covestro AF (COVTY)

Covestro is one the leading suppliers of polymer materials, used in a bunch of different sectors such as construction, automotive, and electronics.

After a solid year in 2021, revenues surged 48.5% year-on-year to $17.59 billion and are projected to advance at a rapid pace in first quarter 2022, up 9.2% quarter-on-quarter to $5.79 billion.

Despite this robust top-line growth, COVTY shares lost 16.13% year-to-date to $26.14 per share. Net debt climbed considerably last year, up 294.7% to $1.55 billion compared to $393.9 million. The consensus of analysts expects a moderate decline in 2022, down 9.3% to $1.47 billion, representing a low leverage ratio of 0.47x.

The decline in the COVTY stock price is an opportunity for investors looking to enter a leading player in the polymer industry, that offers an attractive dividend yield of 6.46% in 2022. In addition, Covestro trades at low valuation multiples, with a forward Enterprise Value (EV)/ Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of 3.95x and price-to-earnings (P/E) of 7.17x.

Altria (MO)

Altria is a “sin” stock, defined as a company involved in or associated with an activity that is considered unethical or immoral. The company operates in the tobacco industry and owns a 10% share in Anheuser-Busch InBev (NYSE:BUD), one of the largest producers of beer in the world.

MO stock outperformed the equity market since the beginning of the year, gaining 8.51%. The tobacco giant is a defensive stock that is less affected by market volatility, because of the incompressible demand for the tobacco products it sells.

Fundamentally, the company is growing at a slow rate, posting a revenue increase of only 1.3% in 2021 to $21.1 billion. Nevertheless, MO stock is projected to increase net income fourfold in 2022 to $8.75 billion versus $2.47 billion last year. With this boost, net margins are expected to expand significantly, reaching 41.5% per year.

MO stock is a promising dividend stock, providing a high expected yield of 6.83% in 2022, with reasonable valuation metrics of 9.46x in terms of 2022e EV/EBITDA and 10.7x forward P/E.

High Dividend Stocks to Buy: Societe Generale (SCGLY)

Societe Generale is one of the largest banking groups in France and is the third-biggest investment bank in Europe.

SCGLY stock price has tumbled 19.02% year-to-date to $5.26 per share, due to increasing concerns that the lender’s $20 billion exposure to the Russian banking system will be stripped out of business if Western sanctions on the Russian economy stiffen.

Nevertheless, SCGLY last month announced that the situation would have no effect on its dividend for 2021, as “…the group has more than enough buffer to absorb the consequences of a potential extreme scenario, in which the Group would be stripped of property rights to its banking assets in Russia.”

The excessive bearish sentiment on SCGLY stock offers a cheap entry point for this high dividend stock. While the French traded shares of the bank carry a compelling dividend of 6.75%, the U.S.-traded version offers less, at 2.49%. Still those shares trade a low forward P/E ratio of only 6.03x.

Rubis (RBSFY)

Rubis is an independent oil operator in the downstream and chemical sector throughout the world. The company is specialized in niche markets where it can control supply infrastructures, enabling it to enter into a leading market position, with a competitive product cost structure.

RBSFY stock underperformed crude oil markets year-to-date after shares decreased more than 3% to under $6 per share. The market seems to underestimate the future potential of Rubis, given that the oil specialist beat analyst expectations with its full year 2021 earnings release.

The fundamental picture of the company remains solid. After jumping by 17.6% to $5.07 billion in 2021, revenues are projected to advance by 9% in 2022 to $5.53 billion.

On the negative side, net debt is expected to nearly double this year to $1.21 billion, representing a leverage ratio of 1.92x and net profit should flatten to $325.3 million, offering a reasonable net margin of 6.38%.

Despite that, the dividend of RBSFY is not expected to be compressed. The oil dividend stock specialist delivers a robust 2022e yield of 7.11% and is valued at a forward EV/EBITDA of only 6.78x and 10.2x P/E.

High Dividend Stocks to Buy: Engie SA (ENGIY)

Engie is another dividend stock with a high yield. The company is a worldwide energy and services company, committed to the energy transition.

Since the beginning of the year, ENGIY stock lost more than 10% to $13.17 per share and has been hit hard by the volatile European gas market.

Net sales are anticipated to advance slimly this year, up only 2.5% to $65.6 billion, nevertheless, the profitability of the utility is expected to remain comfortable versus industry peers, with a net profit of 5.29% expected in 2022.

In terms of the balance sheet, ENGIY’s net debt is projected to decrease 12.1% to $23.9 billion in 2022, offering a leverage ratio of only 1.96x. More interestingly, free cash flows (FCF) are expected to surge this year to $9.59 billion, up 556% year-on-year, which will be enough to maintain or increase dividend distributions over the year.

With the stock declining moderately this year, ENGIY stock delivers a compelling 2022e dividend yield of 7.46%. In addition, the energy giant exchanges at a low valuation of 4.62x forward EV/EBITDA and 9.64x P/E.

BASF (BASFY)

BASF stock is the world’s biggest chemicals maker. BASFY stock dipped 16.2% to $14.82 per share because of rising commodity prices that will no doubt weigh on BASF’s cost structure.

The top line of the company is expected to flatten out, with expected revenues of $87.5 billion in 2022. On the other side, net income is expected to dip 10.4% to $5.5 billion in 2022, bringing net margins to 6.25% per year.

Nevertheless, BASFY stock has a well-capitalized balance sheet, posting a leverage ratio of only 1.5x in 2022 and a solid anticipated FCF of $3.98 billion in the period.

BASF increased dividends over the last 10 years and offers an expected dividend yield of 6.47% in 2022. In addition, it shows low valuation multiples, with 2022e EV/EBITDA of only 6.17x and 9.67x P/E.

High Dividend Stocks to Buy: Archrock (AROC)

Archrock is a U.S. small-cap energy infrastructure company operating in the midstream natural gas compression market and delivering its services to the oil and natural gas industry. Since the beginning of the year, the compression specialist stock surged 19.02% to more than $9.50 per share, benefitting from soaring oil and gas prices.

The top-line decreased moderately in 2021, down 10.7% year-on-year to $781 million, nevertheless, Archrock’s profitability is expected to improve this year, as net income is anticipated to advance 25.2% to $35.3 million.

AROC stock is weighed down by the company’s debt. With net debt of $1.61 billion this year, the leverage ratio stands at $4.73x, which is not a good sign for long-term shareholders.

Besides, FCF is projected to turn negative this year, posting a deficit of $39.4 million, compared to $195 million in 2020. Nevertheless, net cash provided by operating activities and free cash flow after dividends for 2021 reached respectively $237.4 million and $164.2 million.

Despite the deteriorating fundamental picture, AROC stock returns a compelling dividend yield of 6.26% in 2022. It also trades a low forward EV/EBITDA of 8.94x, but exchanges at a less inviting 2022e P/E of 31.9x.

On the date of publication, Cristian Docan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.