The New York Yankees of the '50s and the Chicago Bulls and Dallas Cowboys of the '90s had one crucial element in common: consistent excellence in their organizations and performance. That's a rare accomplishment, but if you think it could never occur in your portfolio, think again. Carefully chosen dividend-paying stocks could be your key to superstar returns.
Build the next investing dynasty
These long-haul outperformers can help you build your fortune, as studies from investing gurus such as Jeremy Siegel have shown time and time again. Finding them is the mission of our Motley Fool Income Investor service.
Constellation Energy Group (NYSE: CEG ) , for example, has returned 75% since June 2004, and it’s currently rewarding investors with a 3% yield. Or consider Enterprise Products Partners, which has returned 58% since May 2004, atop a current 7.4% yield. While these stocks happen to be Income Investor recommendations, you don't need to be a subscriber to get these great gains.
Identify new talent
With the help of Motley Fool CAPS, we'll search for the best dividend-paying stocks around. Here are several dividend picks that have also earned high ratings from the 115,000-plus members of our CAPS community:
|
Company
|
Yield
|
CAPS Rating (out of 5)
|
|
DuPont (NYSE: DD )
|
3.6%
|
****
|
|
Advantage Energy Income Fund (NYSE: AAV )
|
13.2%
|
*****
|
|
Colgate-Palmolive (NYSE: CL )
|
2.1%
|
****
|
|
AT&T (NYSE: T )
|
4.9%
|
****
|
|
Caterpillar (NYSE: CAT )
|
2.5%
|
****
|
Sources: Capital IQ, a division of Standard & Poor's; Yahoo! Finance; and CAPS as of Sept. 4.
Any one of these quality companies would add some dividend excellence to your portfolio, but I thought I'd kick off further research with a closer look at a couple of these stocks.
The ill communication
Ma Bell -- known to the stock market as AT&T -- may not actually be doing cloud computing. And let's face it, some of its work with Apple's (Nasdaq: AAPL ) iPhone has been underwhelming, to say the least. However, AT&T still has a lock on the iPhone, it seems to just keep getting bigger and more powerful, and it's got that nice dividend yield of almost 5%. This is certainly a stock to keep on the radar, at least.
On CAPS, the stock has nearly 3,700 bulls. Among them is CAPS All-Star deathdealer562, who recently rated the stock an outperformer:
I-phone, Blackberry, Any questions? More revenue with new customers from the other companies. You can't go wrong with this company. Safe for a long-term play here. You can sleep @ night with this stock in your portfolio.
Advantage Energy may not be the kind of household name that AT&T is, but this mutual fund trust is the name to tap on this week's list if you're looking for a monster yield. As a trust, Advantage's only mission is to kick out distributions to its unit holders. However, it's Advantage Oil & Gas -- a company wholly owned by Advantage Energy -- that brings home the bacon. Advantage Oil & Gas is a Canadian oil and gas exploration and production company that had 151 million barrels of gross proven and probable oil equivalent at the end of 2007.
The stock is rated five out of five stars on CAPS, with a full 95% of its ratings on the positive side. Back in July, CAPS member Heckspawn gave the stock a thumbs-up, putting it simply: "Nat gas and oil sands. 'Nuff said? How about the 14% dividend? Love it yet?"
Get into the action
You can check out who else has been bullish on these stocks, as well as chime in with your own thoughts, by heading over to CAPS. You may also want to check out a few of the other top-rated dividend payers above while you're there.
Dividend stocks could help you transform your portfolio from the flash-in-the-pan Florida Marlins into the dependable New York Yankees. And if you hate the Yankees, it's probably because they're so darn good, so darn often.
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