Dividend stocks can make excellent long-term investments. They allow investors to earn passive income while also benefiting from the upside of a rising stock price. That one-two punch has historically led to market-beating total returns for dividend stocks.

There are lots of amazing dividend stocks out there. Three that stand out as top buys this March are water utility American Water Works (AWK 0.51%), asset manager Brookfield Asset Management (BN 1.92%), and office REIT SL Green Realty (SLG 3.21%).

A jar of coins with the word dividends written on a label on the front.

Image source: Getty Images.

A fast-rising income stream

American Water Works might not wow investors with its dividend yield. At about 1.7%, it's only slightly higher than the 1.5% average of stocks in the S&P 500. But what makes this water utility stand out as a great option for dividend investors is its long-term growth potential. 

The company expects to grow its earnings per share at a 7% to 10% compound annual rate off last year's base through 2025. Driving that outlook is a plan to invest $10.3 billion to $10.5 billion to expand its footprint over the next four years. Most of that spending will be on infrastructure renewal projects. However, the company also plans to invest capital in expanding its systems organically and through acquisitions, as well as improving its water quality and its infrastructure's resiliency. 

An excellent financial profile, including a top-notch credit rating and a conservative dividend payout ratio, should help fund this growth. American Water Works estimates that it can finance its expansion and increase its dividend at the high end of its earnings growth range over the long term. That sets the company up to potentially produce market-beating returns in the coming years.

A cash-producing machine

Brookfield Asset Management pays a below-average dividend that currently yields around 1.2%. However, the company has steadily increased it over the years, including giving investors an 8% raise for 2021. That growth seems likely to continue. 

Brookfield believes that its businesses, which include managing and investing in private equity funds and companies focused on infrastructure, real estate, and renewable energy, could generate as much as $23 billion in cumulative free cash flow through 2025 and $72 billion over the next 10 years. With its current dividend costing it less than $1 billion per year, Brookfield has ample room to continue hiking its payout in the coming years.

The company also plans to retain the cash it doesn't pay out via dividends to continue compounding shareholder value. It can seed new investment strategies, fund opportunistic and strategic transactions, and return additional capital to shareholders by repurchasing shares. That could lead to even more cash generation in the coming years, potentially accelerating Brookfield's ability to raise its dividend.

A roll of hundred-dollar bills on top of cash.

Image source: Getty Images.

Heading toward the sky

Office REIT SL Green Realty has been a great dividend stock, having increased its payout every year for the past decade. Last year, it also distributed a special one-time stock dividend after cashing in on a major property sale. A monthly payout schedule adds to the appeal of SL Green's dividend, which currently yields 5%.

That high-yielding payout is on rock-solid ground despite the current troubles facing New York City, where SL Green is the largest office landlord. The company spent the past year shoring up its balance sheet by selling assets, giving it the flexibility to buy back its stock and fund development projects. SL Green should be able to continue raising its dividend in the future as the expected recovery in the Manhattan office market unfolds and new office developments eventually pick up momentum.

Top-notch income options

American Water Works, Brookfield Asset Management, and SL Green Realty all pay a growing dividend. These companies offer investors not only solid passive income streams but upside potential as well. That compelling combination makes them great dividend stocks to consider buying this month.