Usually, the decision to target high-yield dividend stocks to buy centers on inflationary concerns. With rising borrowing costs eroding market returns, passive income commands a premium. However, this narrative may also work ahead of what could be a potentially deflationary environment, with the Federal Reserve committed to containing inflation via higher rates.

You might think that passive-income generators won’t work if the value of money rises. However, a presentation by Global X states that during periods of rising rates, high-yield dividend stocks on average outperformed the benchmark equities index. Therefore, even with continued hawkish monetary policy, this segment offers relevance.

To be fair, high-yielding companies tend to be riskier enterprises. Simply put, Wall Street doesn’t offer many free lunches. That said, with so much uncertainty ahead in 2023, the high-yield dividend stocks to buy below should provide investors with a nice amount of income.

Suncor Energy (SU)

Based in Calgary, Alberta, Suncor Energy (NYSE:SU) represents one of Canada’s major hydrocarbon specialists. It focuses on the production of synthetic crude from oil sands. Geopolitical turmoil, rising demand and escalating inflation all contributed to SU’s 25% year-to-date rally.

Those looking for a relatively safe and all-around confidence-inspiring name among high-yield dividend stocks to buy won’t find too many companies better than Suncor. It features a forward annual yield of 4.7%. Its payout ratio is only 28.1%, meaning the dividend should be sustainable based on current earnings trends.

GuruFocus’ proprietary calculation for fair market value labels SU stock as “modestly undervalued.” Backed by a decently stable balance sheet, Suncor enjoys a three-year revenue growth rate of 4.4%. This ranks higher than over 65% of its industry. As well, the company features a net margin of 13.7%, higher than 66% of its peers.

Finally, hedge funds increased their position in Suncor during the third quarter relative to Q2. Thus, SU is worth checking out.

Intel (INTC)

From a distinctly undervalued idea to one that’s underappreciated, Intel (NASDAQ:INTC) can’t seem to catch a break. Before the coronavirus pandemic, it struggled against a mixture of outside competitive pressures and internal controversies. Currently, the headwinds acting against the broader technology space and semiconductor stocks, in particular, have hit the stock, which is down 50% year to date.

Still, for those who want to be a bit adventurous with their high-yield dividend stocks to buy, Intel fits the bill. The company offers a forward yield of 5.6%. That’s well above the tech sector’s average yield of 1.4%. Also, Intel has eight years of consecutive dividend increases.

Its payout ratio stands at 76.1%, though, which is on the high side. Still, as the tech sector aims for a broader recovery in 2023, contrarians may be able to forgive it.

GuruFocus labels INTC “significantly undervalued” based on its proprietary calculation. Further, its price-earnings ratio of 8 is below the industry median of 16.1. Finally, Intel’s net margin of 19.1% ranks higher than 73.5% of the semiconductor industry.

Kinder Morgan (KMI)

Headquartered in Houston, Kinder Morgan (NYSE:KMI) is one of North America’s largest energy infrastructure companies, per its public profile. The company specializes in owning and controlling oil and gas pipelines and terminals. Since the beginning of the year, shares have gained nearly 14%.

The midstream energy player carries a forward yield of 6.2%. Though the energy sector typically offers investors high yields, KMI’s yield easily exceeds the sector average of 4.2%. The payout ratio stands at a lofty 98.5%, but the company has increased its dividend for five consecutive years. Furthermore, midstream firms tend to be lower-risk than other energy categories because of their ties to infrastructure needs such as storage and transportation.

GuruFocus rates KMI “modestly undervalued.” It features decent (though not great) growth trends. Profitability is where the company shines, with a net margin of 13.2%. That ranks better than 65.5% of the industry. Thus, Kinder Morgan brings much to the table as a candidate for high-yield dividend stocks to buy.

British American Tobacco (BTI)

British American Tobacco (NYSE:BTI) is a sin stock that is up 8% year to date, handily outperforming the broader market. This outperformance could continue in 2023 as the economy continues to struggle. While smoking rates have been on the decline for some time, increased stress could lead to an uptick in the habit.

Despite the obvious social ills, British American Tobacco undeniably represents one of the best high-yield dividend stocks to buy. It provides a fantastic forward yield of 7.3%. This rates well above the consumer staples sector average of 1.9%. However, investors should note the payout ratio of 61.3%, which is on the higher side of the spectrum.

According to GuruFocus, BTI rates as a “fairly valued” investment based on its proprietary calculation. However, the company features a forward P/E of 8.2, below the industry median of 12.4. Further, BTI commands strong profitability metrics.

Rio Tinto (RIO)

Rio Tinto (NYSE:RIO) is one of the world’s largest metals and mining corporations. While it’s known for producing several industrial commodities, its focus on mining copper is especially appealing. Copper is an integral component of EV motors and batteries, among other systems and applications.

RIO is volatile, to be sure, but shares are up 5.5% YTD. The stock also offers a forward yield of 7.6%, well above the sector average of 2.8%. To be fair, the payout ratio of 78.5% is lofty. And Rio Tinto doesn’t have any consecutive years of dividend increases to speak of.

Nevertheless, Rio Tinto enjoys a solid balance sheet and excellent growth and profitability metrics. Notably, the company’s return on equity stands at 35.3%, ranked better than nearly 96% of the industry.

Magellan Midstream Partners (MMP)

Another energy infrastructure play, Magellan Midstream Partners (NYSE:MMP) owns petroleum and ammonia pipelines in the central U.S. Per its corporate profile, the partnership “has a 9,800-mile refined products pipeline system with 54 connected terminals and two marine storage terminals (one of which is owned through a joint venture).” The stock has gained 6.7% so far this year.

Of course, the highlight is not necessarily the stock’s performance but rather its forward yield of 8.4%. This ranks well above the energy sector’s average yield of 4.2%. While Magellan’s payout ratio stands at 85.5%, the company is structured as a  master limited partnership, or MLP. This means it passes through its income to its partners in the form of dividends. Further, Magellan has 19 years of consecutive dividend increases under its belt.

Those interested in MMP or other MLPs should research the tax implications before investing.

KKR Real Estate Finance Trust (KREF)

For those that want to roll the dice, consider KKR Real Estate Finance Trust (NYSE:KREF), a leading provider of structured commercial real estate loans. Given macroeconomic headwinds, KREF stock presents serious risks. Shares are down 30% so far this year.

The company has a poor balance sheet. Notably, its cash position is less than desirable and its equity-to-asset ratio of 0.2 times ranks worse than 93% of real estate investment trusts.

Yet, for speculators, shares throw off a forward yield of 11.8%. And analysts remain optimistic about KREF, rating it a “strong buy.” Finally, hedge funds have been generally increasing their exposure to KREF since the beginning of 2021.

On the date of publication, Josh Enomoto 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.