With nearly 1,700 stores under its banner, Safeway ( SWY), one of TheStreet Ratings' top-rated food and staples stocks, weighs in as one of the largest grocery retailers in the country. And in spite of inflationary margin squeeze and hefty competition, it's a business that's remained reasonably strong in 2011. Safeway has embraced the big changes in the grocery business, pushing out a successful private label initiative and a nearly $4.5 billion investment in outfitting its stores to compete with new rivals. While that's resulted in a large debt load, it's also kept shoppers pushing their carts through Safeway's aisles. Even though Safeway's net margins are paper thin, they've been slowly trending higher for most of 2011 -- a testament to management's ability to counter the creep of commodity costs against profitability. Dividends have long been an important part of Safeway's story, and at 2.82%, they remain a compelling reason to own shares of this stock. (Safeway is one of the highest-yielding retail stocks.) While capital investments haven't been cheap for Safeway, ample free cash flow generation should keep the income payouts flowing to owners for the foreseeable future. To see all of this week's Rocket Stocks in action, check out the Rocket Stocks portfolio at Stockpickr. -- Written by Jonas Elmerraji in Baltimore.