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 our Motley Fool Income Investor service's mission.

Air Products & Chemicals (NYSE:APD), for example, has beaten the S&P 500 by 21 points since January 2009, and it currently rewards investors with a 2.2% yield. Or consider AGL Resources (NYSE:AGL), which has topped the S&P by 44 points since March 2004, atop a current 4.7% 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 that have also earned high ratings from the more than 140,000 members of our CAPS community:



CAPS Rating
(out of 5)

Plum Creek Timber (NYSE:PCL)



Raytheon (NYSE:RTN)



Public Service Enterprise Group (NYSE:PEG)






Marathon Oil (NYSE:MRO)



Source: Capital IQ (a division of Standard & Poor's), Yahoo! Finance, and CAPS as of Oct. 15.

Any one of these quality companies would add some dividend pizzazz to your portfolio, but let's take a closer look at how Raytheon stacks up.

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 things I immediately look for when kicking the tires of a dividend payer -- dividend history, financial statements, and business stability.

Raytheon may sport the lowest yield on the above list, but the company makes up for that by providing rock-solid financials to protect dividend investors. Starting with the cash flow statement, Raytheon shows off its might by churning out $2.1 billion in cash flow, while having to reinvest only about $300 million in capital expenditures. This means that the company has plenty of free cash left over to pay its shareholders -- through both dividends and big share buybacks, both of which it has been doing.

The company's balance sheet is formidable as well. Though it does carry more than $2 billion in debt, its debt-to-equity ratio is only 24% and its interest payments are nowhere near worrisome. But just in case, Raytheon also has a $2.2 billion cash stockpile.

Being heavily dependent on one customer is rarely a comfortable position. But if you're going to have one primary customer, then Uncle Sam is the way to go. Raytheon faces tough competition in the defense industry, but as long as it continues to do what it's been doing for a long time -- that is, designing cutting-edge military equipment and systems -- then the constantly changing face of global warfare should keep its wares in high demand.

The only place we could raise a concern when kicking Raytheon's dividend-paying tires is the dividend history. Though Raytheon does have a long record of reliably paying its dividend, it had a stretch between 1996 and 2004 when it didn't raise the payout. This is a bit concerning, but since 2004 the company has boosted its dividend by nearly 50%.

What the bulls say
More than 1,000 CAPS members have stopped by Raytheon's page to give the stock a thumbs-up, and though it doesn't carry a perfect five-star rating, four stars is nothing to sneeze at. CAPS All-Star BSHumphreyII called Raytheon an outperformer back in January, writing:

Raytheon is easily the world leader in missiles, with a great portfolio of long-term contracts. Less will in the United States to deploy infantry overseas could mean a return to the Tomahawk diplomacy of old, and Raytheon is delivering a new generation of Tomahawks and other ground attack missiles. Also, international sales should be strong as our allies modernize their missile inventories. Software, sensors, and other electronics round out a strong, forward-looking defense contract business.

Get into the action
You can check out who else has been bullish on this stock, 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 named 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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