The Top Dividend Stocks of the Week

When a company raises its dividend, it's a significant event. When a company -- such as St. Joe(JOE Quote) -- starts eliminating dividends entirely, the significance is even greater. St. Joe, a Florida-based real estate development company, dropped its dividend completely to help pay off debt as part of its restructuring plan.

When a company issues a dividend for the first time or raises its dividend, it shows that the executives and board of directors believe that the company is in strong financial shape.

Stockpickr has reviewed the companies that increased their dividends last week and posted the stocks with the largest percentage dividend increases in the Top Dividend Raisers for the Week Ending Oct. 7.

First up is Allegheny Energy(AYE Quote). The Pennsylvania-based electric utility reinstated its dividend to 15 cents a share, after going almost five years without any payouts. The stock has a price-to-earnings (P/E) ratio of 26, a P/E-to-growth (PEG) ratio of 1.2, and based on its new dividend, a projected yield of 1.1%. The company will host its earnings call on Oct. 25.

Allegheny was recently added to the portfolio of Jennison Utility A (PRUAX), an open-end fund run by Shaun Hong that specializes in investing in utility equities and bonds. The four-star Morningstar-rated fund has generated an outstanding average annual return -- especially considering it comes from utilities -- of 34% over the last three years. Jennison also owns Sempra Energy(SRE Quote), which has a yield of 2.1%, and Edison International(EIX Quote), with a payout of 2%.