A steady stream of dividends can add up to serious wealth over time. Photo: TaxCredits.net via Flickr.

Dividend stocks are the cornerstone of many well-run retirement portfolios. Dividends act as a beacon to investors, inviting them to take a deeper look into a company whose business model is so sound it can pay out a percentage of its annual profit to shareholders.

Dividends can provide a downside hedge in volatile and bearish markets. Further, investors in dividend stocks tend to be more oriented to the long term, which usually makes for less day trading and volatility. Lastly, dividends can be reinvested, accelerating shareholders' compound gains over the long run. These payouts can mean the difference between simply retiring and living out your dream retirement.

With that in mind, let's look at three cheap dividend stocks you should consider buying right now.

Source: Flickr user Carl Lender.

American Tower (NYSE:AMT)
Want a smart way to take advantage of growing wireless demand and data transmission? Look no further than antenna tower giant American Tower.

Including the nearly 8,500 antenna towers that American Tower added to its portfolio in 2014 through either acquisitions or construction, the company ended its fiscal 2014 calendar year with more than 75,000 towers throughout the world. Antenna towers have seemingly limitless profit potential as next-generation networking advances allow more data to be wirelessly transmitted across a broadening area of the globe. In other words, it means American Tower is in the driver's seat when it comes to negotiating pricing. It also means American Tower can lock in its wireless providers for long-term contracts, providing predictable cash flow.

In its fourth-quarter earnings report, American Tower delivered 9% organic growth within the U.S., with a gross margin of a whopping 80%. In international markets, the company boasted organic growth of 12.6% and a gross margin of 85% if you exclude pass-through revenue. Long story short, between its ability to acquire antenna networks -- for example, it acquired the leasing rights to more than 11,300 towers from Verizon in March for $5.1 billion -- and the rapidly growing demand for wireless data from consumers and enterprises, American Tower has a multidecade growth opportunity on its doorstep. 

Lastly, because American Tower is a real estate investment trust, or REIT, it's required to pay 90% or more of its profits back to shareholders in order to avoid corporate tax rates. This works out to a current yield of 1.7%. That's not huge, but the dividend has the potential to move substantially higher over the coming years.

Source: KeyBank via Facebook.

KeyCorp (NYSE:KEY)
Consumers' trust for large banks may not be what it was prior to the Great Recession, but when we're talking about banks that have made significant strides to better their loan portfolios and create value for their stakeholders, regional bank KeyCorp is one that income investors should be sizing up.

KeyCorp's first-quarter results, released about two weeks ago, showed that the company's year-over-year net income fell by 4.3% to $222 million as it dealt with higher expenses associated with its purchase of Pacific Crest Securities and weakness in investment banking and debt placement fees. However, CEO Beth Mooney wants her shareholders to know that the second half of the year and beyond is looking a lot brighter.

For starters, don't forget that deposit and loan growth are banks' bread and butter. KeyCorp delivered average loan growth of a robust 5.1% in the fourth quarter, driven by a whopping 11.5% rise in commercial, financial, and agricultural loans. So long as lending rates remain near record-low levels, businesses continue to borrow at attractive rates. KeyCorp also notes that its net charge-offs totaled just 0.2%, and its nonperforming loans only 0.75%, implying that the credit quality of its loan portfolio remains strong. Additionally, average deposits jumped 4.9%, which will be a boon for KeyCorp when lending rates do begin to rise.

Source; KeyBank via Facebook.

Another point worth mentioning is that as the stock market continues to climb and the U.S. economy improves, it seems only logical that KeyCorp's investment fees will improve. I wouldn't recommend reading too much into the decline experienced during the first quarter.

Lastly, following the latest round of stress test, the Federal Reserve approved KeyCorp's capital plans, which entail a share repurchase program of up to $725 million and, with the approval of KeyCorp's board, an increase in its dividend to $0.075 per quarter. This $0.01 per-quarter boost would give shareholders a fresh yield of 2.1%!

Trading near its book value, with a PEG ratio of just 1.3 and a forward P/E of 11, KeyCorp is a cheap dividend stock that income investors should seriously consider.

Lastly, if you're on the lookout for a cheap dividend stock, consider consumers' insatiable desire to own brand-name shoes at a discount price.

We need look no further than DSW's fourth-quarter earnings results to get an idea of how much wind is in the company's sails. Fourth-quarter sales rose 12% to $640 million -- about $30 million ahead of Wall Street's consensus figures -- on the heels (sorry) of comparable-store sales growth of 7.6%. Adjusted quarterly profits jumped 13% to $0.35 per share. This was $0.07 ahead of what Wall Street had been forecasting.

Source: DSW via Facebook.

What's been fueling growth for DSW? To begin with, DSW has been dipping its toes into luxury brands and perceived higher-end designer brands. This isn't to say DSW will be straying from its discounted brand-name products anytime soon, but it's a way of encouraging a more affluent customer to step into its stores.

Also, DSW has been taking its products online and to social media to drum up additional business. By emphasizing direct-to-consumer purchases and actively posting on Facebook and Twitter, where it has 2.4 million likes and 91,500 followers, respectively, DSW has done an admirable job of forging an emotional attachment with millennials.

With a freshly raised dividend that's yielding 2.2% annually and a reasonable forward P/E of 18, this is a cheap dividend stock you should consider.