This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

5 Trending Dividend Payers

NEW YORK (TheStreet) -- Today's economic environment is almost nonstop "inflation on" or "inflation off."

Today may have weak economic numbers on housing and unemployment with deflation as the big news story, and the next day high fuel and food prices. Meanwhile, banks are paying yields that are much lower than many investors hoped for just a few years ago.

One solution to the local bank and credit union low-yield blues is through dividend-paying stocks. What is a high-yielding stock? The answer varies right along with inflation and risk-free yields (savings accounts, Treasuries).

Based on today's bank yields and inflation, I examined companies offering yields of 2.8% or higher, with a focus on 3.05% or greater. The annual rate of inflation is near 1.4%. If we can receive a rate of return that is double the rate of inflation, the amount of real, after-inflation wealth will grow significantly with time.

Over the short run, everyone agrees that banks are a relatively safer place to park your cash. However, over the long run, it's hard to make an argument that a personalized portfolio mix will play second fiddle to almost any other public investing opportunity.

Using history as our barometer to gauge what to expect in the future, dividend paying stocks offer the best that investing has to offer.

Dividend investing is more than just collecting a check every three months. Finding high-yield stocks can also lead you on the right path for capital gains. All else being equal, dividend-paying stocks tend to perform better compared to non-dividend stocks over in the long run. Dividend payers also naturally provide risk mitigation.

Ok, we know dividend-paying stocks can outperform, but it's not as effortless as casually selecting the highest-yielding stocks you can find and calling your broker. If you buy a high-yield stock paying 5% and the stocks drops 10% in the next year, the investment loses the luster. There are no guarantees in the stock market, but we can filter the list to find the ones with the most promise.

I start by focusing on stocks I already either trade or follow and that have a large dividend. I add in a screen for large-yield stocks and add the ones that meet the following criteria:

  • The company must have a history of increases in dividend payments.
  • The company needs to demonstrate a likely ability to continue paying at least the current dividend.
  • The chart must be in a bullish uptrend; there is no point in looking for an oversized yield if the shares are expected to drop as much or more in the next year.

1 of 5

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,039.49 +60.36 0.36%
S&P 500 1,992.37 +5.86 0.30%
NASDAQ 4,532.1040 +5.6220 0.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs