Amidst a volatile market, Devon Energy (DVN) and Pfizer (PFE) have emerged as potential opportunities for investors. Both stocks, which have experienced significant declines over the past 18-24 months, offer ultra-high dividend yields with prospects for future increases. Let's take a closer look at each company's current situation and growth potential.

Devon Energy, an oil and gas producer, has seen its shares plummet 47% below their peak in mid-2022. The company faced challenges due to falling oil prices and rising inflation, leading to increased costs and a decline in free cash flow. Consequently, Devon had to reduce its dividend, which disheartened some investors.

However, despite these setbacks, Devon Energy still boasts one of the most attractive dividends in the S&P 500, with a current yield of approximately 7%. Additionally, the recent sell-off has made the stock more appealing from a valuation perspective, trading at under 6.6 times forward earnings estimates, compared to the industry average of 11.2.

Encouragingly, Devon Energy's outlook has begun to improve. The company saw a rebound in free cash flow, enabling a 57% increase in its dividend payout in Q3 2023 compared to the previous quarter. Devon anticipates a 10% decline in capital spending this year, while projecting around 20% growth in free cash flow, which will further boost its variable dividend. The company also expects to increase its fixed dividend payout. Experts predict deflation in service costs and moderate oil price increases in 2024, supporting Devon's positive outlook.

Pfizer, the multinational pharmaceutical giant, has also experienced a significant decline, with shares nearly 54% below their late 2021 peak. Factors such as declining demand for COVID-19 products and concerns surrounding upcoming patent expirations for top-selling drugs have weighed heavily on investor sentiment.

Despite these challenges, Pfizer offers a compelling story. The company currently provides a dividend yield of approximately 6%, with a commitment to continue growing its dividend. While 2024 might be a trough year for Pfizer's COVID-19 sales, the company has addressed the overstocking issues from the previous year and transitioned to a private market model for COVID-19 vaccines. Pfizer aims to introduce a combination COVID-flu vaccine in 2025.

Although some key drugs will lose patent exclusivity in the coming years, Pfizer has outlined a strategy to handle this with confidence. The company anticipates new product launches, label expansions for existing products, and business development deals to generate an additional $20 billion and $25 billion in annual revenue by 2030, respectively. Pfizer's recent acquisition of Seagen alone is expected to contribute $10 billion in new revenue. These revenue sources should offset lost sales from patent expirations and drive robust growth throughout the decade.

From a valuation standpoint, Pfizer appears undervalued, trading at only 12.6 times forward earnings estimates. While it may take time for investors to fully embrace Pfizer's long-term prospects, the company's beaten-down status and high dividend yield present an attractive opportunity.

Both Devon Energy and Pfizer have faced adversity in recent times but show signs of recovery and growth. Investors seeking high dividend yields and potential upside should consider these two stocks. As always, conducting comprehensive research and consulting a financial advisor is recommended before making any investment decisions.