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
TheStreet Open House

Why These Dividend Stocks Should Be on Your Radar

NEW YORK ( TheStreet) -- The market's insatiable appetite for growth often puts dividend-paying companies on the back burner. Despite the allure of growth stocks, they also produce many sleepless nights, particularly in highly volatile markets. But the sentiment is beginning to shift.

Concerns regarding the fiscal cliff showed the value of dividend payers as several companies rushed to accelerate payments in the interest of shareholders. Also, there are several payers that have begun to increase their growth rate, giving investors the best of both worlds.

Here are a few names to consider.

Cisco (CSCO)

Aside from offering one of the best yields at 2.80%, there are many more reasons to love Cisco. The networking giant is a sure-fire bet to hit $30 per share this year. The company has been a model of execution over the past two years, posting seven consecutive earning beats.

In its most recent quarter, Cisco posted net income of $2.6 billion, or 48 cents per share, on revenue of $11.9 billion. Not only did this represent 6% revenue growth, but net income surged 11% as profitability continues to improve. Likewise, the company advanced gross margins sequentially by roughly half of a point, exceeding expectations.

Management has come under fire over the past couple of years, but they deserve considerable credit for this turnaround, which has included a rash of M&A deals. The company's recent shopping spree includes spending $1.2 billion for Meraki and most recently $141 million in cash, bringing its cloud-based acquisitions to nine in 2012.

Cisco is looking to leverage its strong services business, which grew by 12% with more cloud-based purchases. The company understands that once enterprises start migrating fully into the cloud, software will become "the new hardware."

With the cloud market projected to grow to $177 billion within the next two years, there's not a company in a better position to capitalize on that growth. Also, with a strong balance sheet, respectable yield and very limited downside risk, patient investors would do well taking a position here at current levels. At minimum the stock will trade at $25.

1 of 2

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 17,279.74 +13.75 0.08%
S&P 500 2,010.40 -0.96 -0.05%
NASDAQ 4,579.7890 -13.6380 -0.30%

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