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The average dividend yield in the S&P 500 Index remains low at 1.3%. As a result, income investors should focus on higher-yielding securities if they want additional income from their stock portfolios.

Even better, investors can buy high yield stocks when they are also undervalued, which could lead to high total returns in the coming years.

The following 3 undervalued hidden gems have yields above 5%, and high total return potential.

AES Corp. (AES)

The AES (Applied Energy Services) Corporation was founded in 1981 as an energy consulting company. It now has businesses in 14 countries and a portfolio of approximately 160 generation facilities.

AES produces power through various fuel types, such as gas, renewables, coal, and oil/diesel. The company has more than 36,000 Gross MW in operation.

AES Corporation reported fourth quarter results on February 28th, 2025, for the period ending December 31, 2024. Adjusted EPS decreased 26% to $0.54 for Q4 2024, but this still beat analyst estimates by $0.19.

For the full year, AES’ adjusted EPS rose 22% to $2.14 from $1.76 in 2023. The company constructed and acquired 3 GW of renewable energy in 2024, as well as constructed a 670 MW combined cycle gas plant in Panama.

Leadership initiated its 2025 guidance, expecting adjusted EPS of $2.10 to $2.26 for the full fiscal year.

Additionally, the company reaffirms its expectation it can grow EPS on average 7% to 9% through 2025 from a base year of 2020. It also expects annual EPS growth of 7% to 9% from 2023 through 2027.

The company is actively engaged in developing and acquiring new energy projects; it currently has a backlog of nearly 12 GW of renewables. AES expects to complete the majority of these projects over the next three years, but as it continues expanding, new projects could push this date out.

To fund attractive growth opportunities, the company is likely to continue issuing equity and debt, and through asset sales. In all, AES has announced or closed $2.8 billion of its $3.5 billion asset sale target through 2027. Management targets at least 10% CAGR in US Utilities rate base and is also forecasting 7% to 9% annual adjusted EPS growth through 2027.

AES stock currently yields 5.4%.

Shutterstock, Inc. (SSTK)

Shutterstock sells high-quality creative content for brands, digital media and marketing companies through its global creative platform.

Its platform hosts the most extensive and diverse collection of high-quality 3D models, videos, music, photographs, vectors and illustrations for licensing. The company reported $935 million in revenues last year.

On January 7th, 2025, Shutterstock announced it entered a merger agreement with Getty Images through a merger of equals. The combined company will retain the name Getty Images Holdings, Inc and trade on the NYSE under ticker GETY.

Getty Images shareholders will own roughly 54.6% of the entity and Shutterstock shareholders will own the remaining 45.3%. Shareholders of SSTK will receive $28.84870 of cash, or 9.17 shares of Getty Images plus $9.50 in cash per share.

The combined company would have revenue between $1,979 million and $1,993 million, 46% of it being subscription revenue. About $175 million of annual cost savings is forecast by the third year, with most of this expected after 1 to 2 years.

On January 27th, 2025, Shutterstock announced a $0.33 quarterly dividend, a 10% increase over the prior year.

On February 25th, 2025, Shutterstock published its fourth quarter results for the period ending December 31, 2024. While quarterly revenue grew by a solid 15% year-on-year, it missed analyst estimates by nearly $4 million.

Adjusted EPS of $0.67 decreased by 7%, and also missed analyst estimates by $0.18.

Shutterstock has grown at astonishing rates over the past decade. Since 2015, the company’s adjusted EPS has increased at a 24.5% CAGR. And in the last five years, Shutterstock’s EPS has soared 25.9% annually. It has achieved this level of earnings growth from its many acquisitions that have expanded its product portfolio.

Shutterstock has acquired many companies in recent years, such as Envato (May 2024), Backgrid (Feb 2024), GIPHY (May 2023), as well as Pond5 (2022), PicMonkey, TurboSquid, and Amper Music in recent years. Furthermore, Shutterstock has long-term goals it expects to achieve in 2027, such as $1.2 billion in revenue and $350 million in adjusted EBITDA.

SSTK stock currently yields 7%.

T. Rowe Price Group (TROW)

T. Rowe Price Group, founded in 1937 and headquartered in Baltimore, MD, is one of the largest publicly traded asset managers.

The company provides a broad array of mutual funds, sub-advisory services, and separate account management for individual and institutional investors, retirement plans and financial intermediaries.

On February 5th, 2025, T. Rowe Price announced fourth quarter and full year results for the period December 31st, 2024.

For the quarter, revenue increased 11% to $1.82 billion, though this was $50 million less than expected. Adjusted earnings-per-share of $2.12 compared favorably to $1.72 in the prior year, but missed estimates by $0.08. For the year, revenue grew 9.8% to $7.1 billion while adjusted earnings-per-share of $9.33 compared to $7.59 in 2023.

During the quarter, AUMs of $1.639 billion were up 19.2% year-over-year and 3.1% sequentially. Market appreciation of $205.3 billion was partially offset by $43.2 billion of net client outflows.

Asset managers like T. Rowe have low variable costs. As a result, higher revenues, driven primarily by increasing assets under management, allow for margin expansion and attractive earnings growth rates. Assets under management grow in two basic ways: increased contributions and higher underlying asset values. While asset values are finicky, the trend is upward over the long-term.

TROW has increased its dividend for 39 consecutive years and shares are currently yielding 5.3%.

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