5 Dynamic Dividend Stocks

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.

H.J. Heinz (NYSE:HNZ), for example, has returned 32% since August 2004, and it currently is rewarding investors with a 3.9% yield. Or consider ONEOK (NYSE:OKE), which has climbed 80% since November 2005, atop a current 3.7% 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 dividend picks that have also earned high ratings from the 145,000-member CAPS community:

Source: Capital IQ (a division of Standard & Poor's) and CAPS as of Jan. 22.

Any one of these quality companies would add some dividend pizzazz to your portfolio, but let's take a closer look at how Molson Coors 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 places that I immediately tune into when kicking the tires of a dividend payer -- dividend history, financial statements, and business stability.

Dividend investors will find little to gripe about when it comes to Molson Coors. The company has a track record of more than 20 years of paying a dividend, and though it hasn't raised the payout every year, the average growth has been more than acceptable. The house of Coors is also financed conservatively, with a 29% debt-to-equity ratio and EBITDA-to-interest ratio of 7.

As far as business stability goes, does it get anymore stable than beer? OK, that may be an overstatement, but with an army of beverage brands that includes Coors, Molson, Miller, Blue Moon, and Keystone, the company should be able to easily keep its footing through thick and thin.

The company also churns out plenty of cash, which keeps the dividend very affordable. In fact, if income-oriented investors want something to complain about, it might be that the company has been a bit stingy about its dividends. Over the past decade, the beer baron has kept its payout ratio well below 40% -- and quite often below 25% -- which is safe and conservative, but puts less cash in investors' pockets.

What the bulls say
Over the past year, Molson Coors' stock has posted meaningful underperformance compared with the S&P 500. However, the stock's recent limp also means it hasn't seen its price inflate with the rest of the market. In fact, at its current level, the stock is trading below 12 times its expected 2010 earnings.

With 564 outperform ratings against just 32 underperforms, it's clear the CAPS community thinks that investors should be tapping this beer-slinging stock. Last summer, CAPS All-Star 00100 gave Molson Coors' stock a thumbs-up, citing a simple formula for success: "Upthumb. Strong cash flow. Good payout. Low debt. Looking for growth by acquisitions."

Get into the action
You can check out who else has been bullish on these stocks, as well as chime in with your own thoughts by heading over to CAPS.

Dividend stocks could help 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.

My fellow Fool Matt Trogdon suggests that you ignore this terrible advice, and continue to build your retirement portfolio with winning dividend stocks.