The New York Yankees of the '50s and the Chicago Bulls and Dallas Cowboys of the '90s have 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.

Diageo (NYSE:DEO), for example, has beaten the S&P 500 by 36 points since April 2004, and is rewarding investors with a 3.7% trailing yield. Or consider France Telecom (NYSE:FTE), which has topped the S&P by 42 points since January 2006, atop a 7.5% trailing 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 140,000-plus members of our CAPS community:



CAPS Rating
(out of 5)

Joy Global (NASDAQ:JOYG)



Trinity Industries (NYSE:TRN)



Chevron (NYSE:CVX)



American Eagle Outfitters (NYSE:AEO)



Caterpillar (NYSE:CAT)



Source: Yahoo! Finance and CAPS.

Any one of these quality companies would add some dividend excellence to your portfolio, but let's take a closer look at why CAPS members think that American Eagle Outfitters is worth a hard look.

Does my dividend have a glass jaw?
The last thing we want in a dividend-paying company is the risk that the company will fall off a cliff and have to pull back its dividend. This usually ends up being a double whammy because not only do you lose your dividend payout, but many of the dividend-loving investors who own the stock will run for the hills, causing the stock price to fall.

With that in mind, there are three places that I immediately tune into when kicking the tires of a dividend payer -- dividend history, financial statements, and business stability.

American Eagle has the moves when it comes to its financial statements. Starting at the balance sheet, the company has more than $500 million in cash on its books against virtually no debt. Its cash flow statement is no less encouraging. With the notable exception of its 2009 fiscal year (which ended in January), the company typically produces far more cash than it uses on capital spending.

But the fly in this bit of retail ointment is that American Eagle's flagship brand brings home the bacon by selling trendy clothing. While this business has paid off for the company in the past in the form of strong revenue growth and healthy returns on capital, the fate of trendy apparel hangs on very fickle consumers who are currently keeping a close watch on their bank accounts.

What the bulls say
American Eagle hasn't quite earned a perfect five stars from the CAPS community yet, but the stock has gotten nearly 2,400 outperform ratings, against just 170 underperform ratings. CAPS members like the company's strong financial position, the stock's beaten-down price, and the quality of the position of the American Eagle brand in the apparel segment.

Getting more specific, in the fall of 2008, CAPS All-Star dibble905 rated the stock an outperformer based on the company's strength versus other clothing retailers: "The retail sector has been beaten hard by the recent turmoil, but if any clothing retailer is to survive through this mess and have at least a bounce back from it's recent lows, it would be AEO. The only underlying issue I see is whether this company can remain a leader once it hits its prime."

Get into the action
Almost a year later, do you agree with dibble905's sentiments? 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.

Diageo and France Telecom are Motley Fool Income Investor picks. 

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out the stocks he's keeping an eye on by visiting his CAPS portfolio or connect with him on Twitter @KoppTheFool. The Fool's disclosure policy pays its dividends in reliability.