Dividend Stocks From a Top Money Manager

One of the handy features of Stockpickr.com is the site's portfolio ratings feature, which allows Stockpickr members to rate portfolios on the site.

One of the professional portfolios that sports the maximum four-star rating is Cutler Capital, a money management firm that has returned 78% over the last three years. The firm specializes in income-oriented investments including convertible bonds, real estate investment trusts (REITS) and preferred stocks.

As many investors shift toward income investments, Cutler Capital's stocks are worth examining. The portfolio was updated last week.

One of the highest-yielding stocks that Cutler owns is American Financial Realty Trust(AFR Quote), a REIT with an interesting niche. The company leases buildings primarily to financial institutions, such as banks and credit unions. The company is planning to merge with Gramercy Capital(GKK Quote) and has set a special shareholder meeting for Feb. 13 to vote on the $1.1 billion deal. The stock has a price-to-earnings (P/E) ratio of 58, a P/E-to-growth (PEG) ratio of 2.3, and it pays a high yield of 9.5%.

American Financial is also part of the WisdomTree SmallCap Dividend ETF, an exchange-traded fund that tracks dividend-paying small-cap stocks. Other stocks in this ETF include Nationwide Health Properties(NHP Quote), which yields 6.4%, Newcastle Investment(NCT Quote), which yields a very high 21.1%, and Entertainment Properties Trust(EPR Quote), which pays 6.4%.

Lexington Realty Trust(LXP Quote) is another REIT stock owned by both Cutler and the WisdomTree ETF. Lexington offers a yield of 9.4%.

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