Even as stock markets rise, it’s possible to extract high-quality dividend stocks at very low prices. In addition to enjoying tremendous dividend yields, through careful selection investors can find great stocks that look like bargains based on other popular metrics.

takes Ewright (LSE:AEWU) and Admiral Group (LSE: ADM). In addition to generating returns of 7% or more, these passive income champions have other qualities that make them great value picks to consider

Do you want to know why they can increase passive income? Read on.

Please note that tax treatment depends on each client’s individual circumstances and may be subject to change in the future. The content in this article is provided for information purposes only. It is not intended to be, and does not constitute, any form of tax advice.

The pinnacle of confidence

Real estate investment trusts (REITs) are designed to provide a larger, more reliable income stream than most other dividend stocks. At least 90% of rental income must be paid each year, in exchange for great tax breaks.

Companies like AEW REIT have a steady stream of rental income that they can use to fund shareholder payments. In this case, dividends are paid four times a year. The question is, can the company continue to do so under the difficult circumstances of the broader economy?

After all, trusts are exposed to highly cyclical sectors such as industrials and retail. Overall, I’m confident about its future earnings prospects. It has 132 tenants on its books, protecting the group’s profits from widespread rent collection and/or occupancy issues.

Furthermore, the weighted average unexpired lease term (or WAULT) to expiration is 5.6 years. This provides a solid view of near-term earnings (and hence the dividend).

But what makes AEW REIT an attractive value stock today? Not only does it save a lot of money for a 7.5% forward dividend yield. It trades at a useful 5% discount to its net asset value (NAV) per share.

FTSE 100 Dividend Star

At 7%, the dividend yield on Admiral shares is the third highest on the FTSE 100. Can it meet City analysts’ high income forecasts? I think so.

Unlike many high-yielding financial services stocks, Admiral operates in a stable general insurance market. Consumer spending here remains largely unchanged across the economic cycle, providing excellent, reliable income that can be distributed through dividends.

However, the main advantage of this company is its dominant position in the car insurance market. In the UK, it insures more cars than any other company and has a 14% market share. It also has positions in foreign markets. This is important, as vehicle coverage is a legal requirement, providing profits with additional protection.

Admiral’s cash-rich balance sheet also provides a boost to future earnings. According to the latest financial statements, the Solvency II capital ratio reached 194%, which is well above regulatory requirements.

There is no such thing as a risk-free profit share. In this case, dividends may fall short of expectations if costs rise again, putting margins under pressure. Admiral also has significant competitive pressures to navigate to maintain increasing profits and payouts.

But overall, I think it’s a solid stock to consider today. It is also trading at a cheap price at the moment. Its price-to-earnings (P/E) ratio of 12.3 times is well below the 10-year average of 17-18.