Dividend Stocks for the Week

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By Jonas Elmerraji

BALTIMORE (TheStreet) -- After six straight days of gains, the markets are taking a breather today, which gives us the chance to focus our attention back on the stocks that announced increased dividends last week.

Increasing dividends is a significant development that investors shouldn't overlook, whether they've focused on dividends in the past or not. Historically, companies that pay dividends materially outperform those that don't, and when the market turns bearish, dividends could be the only semblance of return that investors see for a while.

That's why every week Stockpickr reviews recent dividend declarations and compiles a portfolio of dividend-increasers. These stocks represent some of the most enticing investments on the market right now.

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One of last week's bigger dividend hikes came from Polo Ralph Lauren(RL). The apparel maker doubled its dividend payouts from 5 cents to 10 cents per share. The increase came after RL announced a 10% jump in its fiscal second-quarter profits, received an upgraded to Goldman Sachs' Conviction Buy list.

2009 has been a terrific year for RL. Shares have gained 80% since January, and sales have continued to grow despite cooled consumer sentiment for retail products. This company's quick reaction to the recession, including paring back inventories and reacquiring brand licenses at reduced prices, should serve its shareholders well going into 2010. An increased dividend is only the latest affirmation of that.

One fund that sees value in Ralph Lauren is the Baron Asset Fund, a $2.6 billion no load fund managed by long-term investor Andrew Peck. The fund also counts holdings of Charles Schwab(SCHW), with a dividend yield of 1.35%, and Southern Union(SUG), with a dividend yield of 2.99%.