Dividend Stocks for the Week

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By Jonas Elmerraji

BALTIMORE ( TheStreet) -- On Monday, President Obama addressed the nation about his plans to reform the financial system that has left so many investors disillusioned. The move, which calls for the creation of a Consumer Financial Protection Agency, was greeted with mixed feelings by Americans.

But while all eyes were on Washington, a few companies were letting investors know that not all stocks got stomped in the aftermath of the financial crisis of 2008. In fact, two companies actually boosted their dividends in the last week, much to the excitement of their investors.

Increasing a dividend is a big deal for any company, but it's a particularly significant event in the midst of a recession. Dividends are so significant because 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.

The biggest increaser last week was Village Super Market ( VLGEA), a small-cap supermarket chain that operates 25 ShopRite stores in New Jersey and Pennsylvania. The company raised its dividend 7% to 23 cents per share for shareholders of record on Oct. 1. The dividend hike comes as a coup for supermarket retailers whose thin margins have been squeezed extra hard this year as consumers cut back on discretionary purchases at the grocery store. Shares of Village Super Market were trading flat on Tuesday as the dividend changes pushed the stock's yield to 2.9%.

Despite Village Super Market's small size, it has been garnering the attention of institutional investors. The stock is a holding of the Vanguard Total Stock Market Index Fund, rated three stars by Morningstar. The fund owns shares of another retailer you may be familiar with, Wal-Mart ( WMT), as well as quite a few large-cap stocks, Exxon Mobil ( XOM) and Microsoft ( MSFT) among them. Wal-Mart yields 2.1%, Exxon yields 2.4%, and Microsoft yields 2.1%.

The other stock to increase its dividend payout last week was Brady Corporation ( BRC), a manufacturer of identification solutions designed to "protect premises, products and people." Brady increased its dividend 2.9% to 17.5 cents per share for stockholders of record as of Oct. 9, pushing the company's yield to 2.3%.

Brady is a holding of the Neuberger Berman Genesis Trust, a value-oriented fund that has been managed since 1994 by Judith Vale. The fund focuses on small-caps, such as Brady, and also has positions in Denbury Resources ( DNR) and IDEXX Laboratories ( IDXX).For the rest of this week's dividend stocks, check out the Dividend Stocks for the Week portfolio on Stockpickr. And if you haven't already done so, join Stockpickr today to create your own dividend portfolio.

-- Written by Jonas Elmerraji in Baltimore.

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Stockpickr is a wholly owned subsidiary of TheStreet.com.

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

Jonas Elmerraji, based out of Baltimore, is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia , and has been featured in Investor's Business Daily , in Consumer's Digest and on MSNBC.com.

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