NEW YORK (TheStreet) -- For long-term investors, higher taxes and worries about the fiscal cliff offer a chance to buy quality stocks at a discount.

The winds of change in Washington may change direction from time to time, but for long-term investors the time to enter is when there is blood on the street.

I have had more than my share of people asking for a list of stocks to own in 2013. I limited my list to stocks with large, increasing dividends that are appropriate to buy and forget about.

Predicting a year in advance is no small endeavor, especially if you want any hope of getting it right. Difficult doesn't mean impossible, however. It's difficult to predict short-term moves, too, but historical data allow us a way to peek into the markets of 2013.


dividend-paying stocks

tend to outperform over the long run. Stocks with price-to-earnings ratios under 20 also tend to outperform the latest craze. Emotion plays a short-term role in valuation, and we can measure emotion, in part, with the PE ratio.

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For a company to exceed a PE ratio of 20, both earnings and revenue must be growing proportionately higher. Many people make the mistake of ignoring earnings growth and focusing on revenue. Ignoring revenue is a mistake.

The reason both revenue and earnings must be counted is because many companies are able to grow but fail to make a profit. Once growth slows (and it always does), if a company hasn't grown earnings to support an increase in stock price you quickly learn what the term "bag holder" means.

Here are the large dividend-paying stocks I think are worth owning and forgetting about in 2013.

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GLW Dividend Yield

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(GLW) - Get Corning Inc Report

Background: Corning creates leading-edge technologies for the fastest-growing markets of the world's economy. Corning manufactures optical fiber, cable and photonic products for the telecommunications industry; and high-performance displays and components for television and other communications-related industries.

52-Week Range: $10.62 to $14.62

Price To Book: 0.9

Earnings Payout Percentage: 24%

Glass may not initially appear sexy, but after you look at the profits the view becomes more exciting. Corning incorporates everything you want for a long-term "buy it and forget about it" type of hold.

Corning has an oversized dividend that is likely to increase, a large R&D budget, and the company is not sitting on its laurels. Corning may begin to realize inroads into the automobile industry with products for windows and windshields.

The dividend is small enough that investors may reasonably expect increases in the payout. Corning currently has an annualized dividend of 36 cents, yielding 2.8%.

In the last month, the stock has really moved higher with a 67.4% increase. Over half the analysts covering Corning rate it as a buy or strong buy. In the last 52 weeks, the shares are about even, with a small gain of 2%. Corning has an average analyst target price of $14.62.

The last reported short interest is only 1.7% of the average trading float. Short sellers are all but avoiding Corning, which is just what we want as investors.

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GLW Payout Ratio TTM

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KO Dividend Yield

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(KO) - Get Coca-Cola Company Report

Background: Coca-Cola Company engages in the manufacture, marketing, and sale of nonalcoholic beverages worldwide. The company primarily offers sparkling beverages and still beverages. Coke is the most common soft drink I came across in my travels to China.

52-Week Range: $33.28 to $40.67

Price To Book: 5

Earnings Payout Percentage: 52%

Coca-Cola pays out $1.02 annually in dividend payments. The yield based on a recent price is 2.8%. In 2009, when many companies reduced or stopped their dividends, Coca-Cola not only continued distributions, but increased the amount. If history is our guide, the current 2.8% yield should be considered more of a starting point than future expectations.

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Analysts like Coke, too. Over half the analysts covering Coke rate it as a buy or strong buy. The one-year return is 3.9%, and the average analyst target price for Coke is $42.38. Notwithstanding an ineffective stock split a few months ago, I believe Coke will continue higher.

Short-sellers are next to impossible to find. Short interest is so low, it's below 1% of the float. If you want a winning long-term hold that will put a smile on your face this time next year, buy Coke and receive a dividend that will have you grinning from ear to ear.

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KO Payout Ratio TTM

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WFC Dividend Yield

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Wells Fargo

(WFC) - Get Wells Fargo & Company Report

Background: Wells Fargo & Company is a diversified financial services company providing banking, insurance, investments, mortgage and consumer finance services through stores, its Internet site and other distribution channels across North America as well as internationally. Wells Fargo set the bar for other banks in risk management. While many other banks experienced an implosion in book value during the housing crisis, Wells Fargo's risk controls ensured investors were protected.

52-Week Range: $27.08 to $36.60

Price To Book: 1.3

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Earnings Payout Percentage: 25%

The company currently pays 88 cents per share in dividends for a yield of 2.6%. Dividends are lower from early 2009 but unlike many other financial institutions, dividends, albeit smaller, were not halted. Investors can count on the

Federal Reserve

to keep banks healthy until the economy turns around.

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Having the Fed as your sugar daddy should not be discounted. It's the ultimate in privatization of profits and socialization of losses. Once the economy begins growing again (and it will), a river of profits along with dividend increases can be expected. Wells Fargo is nothing less than a heads-you-win, tails-you-break-even type of play.

Stocks making money in good times and bad don't need analysts to convince you to buy them, but Wells Fargo has the backing of analysts, too: 21 of the 36 analysts covering the company give a buy recommendation.

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INTC Dividend Yield

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(INTC) - Get Intel Corporation (INTC) Report

Background: Intel designs, manufactures, and sells integrated digital technology platforms primarily in the Asia-Pacific, the Americas, Europe and Japan. Intel is my "on a limb" suggestion.

52-Week Range: $19.23 to $29.27

Price To Book: 2.1

Earnings Payout Percentage: 37%

Shares have fallen since April and are down for the year. The fall for previous shareholders is an opportunity for new investors.

The opportunity comes from investors who are not paying attention to the long-term theme. The long-term theme is a company that took a few arrows recently but is in great shape to exploit new markets. It's a huge mistake to discount the ability of Intel to adapt to and dominate new markets.

New markets include increased use of smart devices -- and I don't limit devices to smartphones. Expect everything we touch to become smart or smarter. Cars, homes, TVs, other appliances and more will increasingly come together.

>>> Also see: Who Takes Gold in a Year of Bad Ideas?

Will everything, including the family pet, have an Intel chip by the end of 2013?

Probably not, but Intel will pay you a fat yield of 4.4% while you wait. Not only is the dividend relatively safe, the payout ratio is low enough that investors can expect an increase as earnings grow.

In the last 52 weeks, the shares are about even with a small gain of 1.8%. Intel has an average analyst target price of $23.14. Not everyone buys into an up and coming Intel in 2013. Short interest is over 4% even though it's expensive to hold a short position. Short-sellers are generally the smart money, but they don't always get it right. Intel has reached bargain-level pricing and shorts who don't cover soon may wish they had.

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INTC Payout Ratio TTM

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GE Dividend Yield

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General Electric

(GE) - Get General Electric Company (GE) Report

Background: General Electric is one of the largest and most diversified industrial corporations in the world. GE is engaged in developing, manufacturing and marketing a wide variety of products for the generation, transmission, distribution, control and utilization of electricity.

52-Week Range: $17.72 to $23.18

Price To Book: 1.8

Earnings Payout Percentage: 52%

GE is currently trading near the 200-day moving average. The weekly chart is more bullish but, pushing the technical aside, it's hard for me to find many companies I am more bullish on from a long-term hold point of view.

GE walked up to the edge of the abyss in 2009 and was forced to cut dividends. Before 2011, GE started increasing the dividend payout and this month increased the amount to 19 cents per quarter.

GE's 76 cents a year in dividends is a yield near 3.7%. The current yield is attractive relative to other stocks, however. The real investment story is future dividend increase prospects. I wrote about GE recently in

this dividend-focused article.

Revenue and earnings are once again meeting or exceeding investor expectations, and GE is a dominant presence around the world. The payout ratio based on next year's estimates and the current dividend is under 50%.

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Fiscal cliff or no fiscal cliff, GE is international enough to grow either way. The majority of analysts believe GE continues to offer a buying opportunity, with 12 of the 16 analysts covering the company giving it a buy recommendation. The average analyst target price for GE is $24.71.

After accounting for stability, dividends, capital gains expectations and worldwide exposure, GE makes my very short list of dividend stocks you can buy and forget about.

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GE Payout Ratio TTM

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At the time of publication the author had no position in any of the stocks mentioned.

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This article was written by an independent contributor, separate from TheStreet's regular news coverage.