Quiz time, sports fans: What did the New York Yankees of the '50s and the Chicago Bulls and Dallas Cowboys of the '90s have in common? (And exactly how can this help you with your portfolio?)
It wasn't just that they had some of the best individual players of the time -- Yogi Berra, Michael Jordan, and Emmitt Smith, respectively -- although that certainly helped. And it wasn't just that they were able to bring home world championship trophies on a regular basis. It was simply that their organizations and performances were consistently excellent.
Consistent excellence is rare anywhere, but imagine seeing it in your portfolio. Impossible? No way! Because that's what carefully chosen dividend-paying stocks can offer.
Build the next investing dynasty
Finding 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 for you is precisely what we do at our Motley Fool Income Investor service.
National Grid
Identify new talent
With that last thought in mind, I'd like to introduce you to our new community intelligence database, Motley Fool CAPS. There, savvy investors help one another identify stocks that can create consistent and substantial growth for any type of investor. That means whether you're a Buffett-esque value investor or a chart-watching technical trader, you are welcome to strut your stuff. And, just as in professional sports, the cream inevitably rises to (and stays at) the top.
So what are the best dividend-paying stocks around, according to CAPS? Here are a few dividend picks with five-star ratings:
|
Company |
Yield |
|---|---|
|
Value Line |
2.6% |
|
Sasol |
2.4% |
|
Norsk Hydro |
1.9% |
|
Eni SpA |
3.5% |
|
BASF |
2.5% |
Stake your claim
I encourage you to join CAPS to learn more about why investors are so bullish on these companies, and perhaps to add your own thoughts to the system. I'll get you started with some thoughts about one company here that may be worth checking out: Sasol.
If you look closely enough, you'll notice something similar in four of the five stocks on this week's list. If you said that four of the five are listed on the NYSE, you'd be right, but you'd also be on the mark if you noted that four of the five are foreign companies. Sasol is out of South Africa, Norsk Hydro is (surprise!) based in Norway, Eni calls Rome home, and BASF's headquarters is in Germany.
Why is this notable? Because the U.S. just ain't the only game in town any more. While top billing outside the States often goes to the so-called BRIC countries (Brazil, Russia, India, and China), many less-hyped countries also have great investment opportunities. It was exactly these opportunities that prompted the creation of The Motley Fool's Global Gains newsletter. The team, led by Bill Mann, has been digging up some of the best opportunities outside of sweet home USA.
One of our five-star dividend stocks for this week, Sasol, was an early pick from the Global Gains team. Sasol is a major integrated oil and gas company whose stock has jumped 263% over the past five years. Currently, 755 Fools on CAPS think the stock will continue to outperform, versus just 10 who think otherwise. 8Buckeye is one of those 755 bulls and likes the stock for a variety of reasons:
[Sasol has] what seems to be very good management, an outstanding balance sheet, ... six years of positive [free cash flow] (out of the last eight), have paid out a dividend that they seem to be able to keep increasing (it has tripled over the last six years), and the know-how and technology to grow.
You can check out more of what others have to say about Sasol, 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.
And looping back around to conclude my (very) extended sports metaphor, allow me to suggest that dividend stocks will help you turn your portfolio into the dependable New York Yankees, rather than the flash-in-the-pan Florida Marlins. And if you hate the Yankees, it's probably because they're so darn good, so darn often.
More CAPS Coverage:
Norsk Hydro is an Income Investor selection.
Yankees fan and Fool contributor Matt Koppenheffer hopes the Yanks can continue (regain?) their legendary excellence, and has his fingers crossed that the Cowboys will never get back to the top again. He does not own shares of any of the companies mentioned. The Fool's disclosure policy is a true investing dynasty.
