- The stock market is experiencing increased volatility amid inflation fears, geopolitical uncertainty, and shifting interest rate expectations.
- Below we highlight four undervalued stocks that stand out for their ability to navigate the current volatility.
- All four stocks have outperformed the S&P 500’s YTD return while paying dividends that cushion portfolios during drawdowns.
With equity markets experiencing heightened volatility in early 2026, investors are increasingly turning to stocks that combine attractive dividend income with defensive business models and strong year-to-date momentum.
Betterware de México (NYSE:), Spectrum Brands (NYSE:), Sirius XM (NASDAQ:), and Kinetik Holdings (NYSE:) all fit that bill. Each operates in a distinct area of the economy, offers some degree of defensive or contracted cash flow, and pays a dividend that can help smooth returns during bouts of volatility.
Below is a closer look at why they deserve a spot in a volatility-resistant portfolio.
1. Betterware De Mexico
- Current Price: $17.09
- Fair Value Estimate: $27.55 (+61.2% Upside)
- Market Cap: $633.9 Million
Despite the market’s recent whiplash, Betterware De Mexico has delivered a +20.3% YTD return, outpacing most peers. The Mexico-based specialty retailer’s core business, spanning home organization and personal care, has proven defensive as demand remains steady even when consumers tighten belts.
The company backs this resilience with a solid 6.38% dividend yield and a recent payout of $1.11 per share, making it a compelling choice for income-seekers.
Source: InvestingPro
What sets BWMX apart is its valuation story: the current price of $17.09 sits far below both its fair value upside of 61.2% and the 74.5% analyst target upside. That’s a rare combination of momentum and deep value.
2. Spectrum Brands
- Current Price: $71.94
- Fair Value Estimate: $113.36 (+57.6% Upside)
- Market Cap: $1.67 Billion
Spectrum Brands, another standout, has climbed +21.8% YTD, but the stock hardly looks “loved.” The household and personal products company’s diversified consumer portfolio and recession-resistant assets (like propane) help the stock weather economic storms.
Spectrum’s 2.5% dividend yield with a $1.88 per share payout adds a steady income stream. Analysts see further headroom, with a fair value upside of 57.6% and 18.7% analyst upside, suggesting the rally could have legs, especially if its brand investments and segment separation plans boost margins as hoped.
Source: InvestingPro
At a discounted valuation relative to peers, SPB can serve as a defensive-plus-catalyst holding in a choppy tape.
3. Sirius XM
- Current Price: $22.40
- Fair Value Estimate: $31.60 (+41.1% Upside)
- Market Cap: $7.49 Billion
Sirius XM, up +12% YTD, is proof that even legacy media can shine in uncertain times. The satellite radio and streaming audio giant’s subscription-based model offers predictable cash flows, supporting a 5.06% dividend yield and a recent $1.08 per share payout.
The stock trades at a value-oriented 9.9x P/E, with a fair value upside of 41.1%, although analyst upside is a more modest 8.2%.
Source: InvestingPro
While the company faces competition in the audio space, its unique content, exclusive sports coverage, and embedded presence in millions of vehicles create a durable moat.
4. Kinetik Holdings
- Current Price: $46.61
- Fair Value Estimate: $59.23 (+27.1% Upside)
- Market Cap: $7.56 Billion
Kinetik Holdings tops the YTD charts with a +29.3% return, fueled by its strategic footprint in the Texas Delaware Basin. Its midstream energy operations offer stability amid commodity swings, and a generous 7.94% dividend yield (recent payout: $3.24 per share) rewards patience.
With a fair value upside of 27.1%, KNTK is seen as both a growth and income play, especially attractive with analysts flagging it as a logical M&A candidate and raising price targets after recent earnings beats.
Source: InvestingPro
In an environment where inflation, rates, and geopolitical risks all argue for some exposure to real assets and energy infrastructure, Kinetik offers both a substantial cash payout and the potential for modest multiple expansion.
Bottom Line
These four stocks offer a practical way to generate income and weather market turbulence without sacrificing growth. Whether you’re seeking ultra-high yields (BWMX and KNTK) or steadier defensive plays (SPB and SIRI), they deserve consideration for a balanced, dividend-focused portfolio.
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Disclosure: This is not financial advice. Always conduct your own research.
At the time of writing, I am long on the S&P 500, and the Nasdaq 100 via the SPDR® S&P 500 ETF, and the Invesco QQQ Trust ETF. I am also long on the Technology Select Sector SPDR ETF. I regularly rebalance my portfolio of individual stocks and ETFs based on ongoing risk assessment of both the macroeconomic environment and companies’ financials.
The views discussed in this article are solely the opinion of the author and should not be taken as investment advice.
Follow Jesse Cohen on X/Twitter @JesseCohenInv for more stock market analysis and insight.
