The New York Yankees of the '50s and the Chicago Bulls and Dallas Cowboys of the '90s have one crucial element in common: consistently excellent 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.

Windstream (NYSE: WIN), for example, has returned more than 38% since January 2004, and it currently is rewarding investors with an 8.7% yield. Or consider National Fuel Gas (NYSE: NFG), which has returned 53% since August 2005, atop a current 2.9% 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 81,000-plus members of our CAPS community:



CAPS Rating

American Eagle Outfitters (NYSE: AEO)



Whole Foods Market (Nasdaq: WFMI)



Himax Technologies (Nasdaq: HIMX)



Healthcare Services Group (Nasdaq: HCSG)



San Juan Basin Royalty Trust (NYSE: SJT)



Source: Capital IQ (a division of Standard & Poor's), Yahoo! Finance, and CAPS as of Jan. 17, 2008.

Stake your claim
Here's my question: If we are headed into a recession like so many seem to think we are, will consumers continue to be willing to spend extra cash on fancy produce and organic foods? CAPS players seem pretty convinced that the answer is yes. Whole Foods currently finds itself with 2,826 fans on CAPS versus just 285 players who think the stock is poised to underperform.

  • Lepersinmyhead asserted that Whole Foods is "a superbrand and superbrands print money." Shall we say the Nike of organic food?
  • Meanwhile, raidman gives an anecdotal perspective, noting, "I shop in their stores and they are excellent. Stores are very crowded for a 'specialty' store and I feel people are more and more interested in organic food!"
  • Top rated LurkyLurky has been bullish since early 2007 and said, "The P/E is higher than I would like, but this is a very long-term pick. I think that Whole Foods will be alive and well for decades. I like the way they steadily increase their dividends." But the appeal of the stores is not lost on this All-Star, either. "I also like their stores, and [co-founder and CEO] John Mackey."

It's been a tough market for just about every stock -- save those darn oil companies! -- and Whole Foods is no exception. As of Thursday's close, the stock was down 34% from its October peak. So why start looking at it now? Well, let's start with the fact that it's down 34% from its October peak.

While the stock slumps, the company continues to build its business. It finished 2007 with impressive same-store sales growth and completed the acquisition of competitor Wild Oats. The acquisition, as well as new store opening costs, ate into the company's profits for the year, but current analyst expectations are for earnings per share to resume growth this year and accelerate growth in fiscal 2009.

You can check out who else has been bullish on Whole Foods, 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.

More CAPS Foolishness:

National Fuel Gas and Windstream are Income Investor recommendations. American Eagle Outfitters and Whole Foods Market are Stock Advisor picks. The Motley Fool owns shares of American Eagle Outfitters.

Yankees fan and Fool contributor Matt Koppenheffer hopes the Yanks can continue their legendary excellence (maybe next year ...), and has his fingers crossed that the Cowboys never get back to the top. He does not own shares of the companies mentioned in this article. The Fool's disclosure policy is a true investing dynasty.