Top 10 Dividend Stocks

NEW YORK ( TheStreet) -- Dividend yield is the most important factor to use when evaluating investment opportunities, says London-based portfolio manager Job Curtis. Stocks paying steady dividends tend to fall less than the others during tough economic times.

The 10 selected stocks from diversified sectors like energy, financials, medical equipment and consumer goods have dividend yields ranging from 2% to 14% and one-year dividend growth of 6% to 70%.

Based on average estimates of analysts surveyed by Bloomberg, these stocks have upside of 10% to 56%. Among analysts covering the stocks, 74% on average recommend a buy.

The stocks are listed in ascending order of upside expected by analysts.

10. Procter & Gamble ( PG) is a global consumer products giant offering well-known brands. The company's products find exposure in more than 180 countries.

For the first quarter of fiscal 2012, P&G has increased its quarterly dividend to 52 cents from 48 cents in the year-ago period. Operating cash flow was $2.2 billion and free cash flow stood at $1.03 billion. The company has repurchased $1.3 billion shares and returned $1.5 billion cash as quarterly dividend. Currently, the stock is trading at a dividend yield of 3.1% and 9.1% one-year dividend growth, as per data compiled by Bloomberg.

For its first quarter fiscal 2012 ended Sept. 30, the company reported net sales growth of 9% to $21.9 billion compared to $20.1 billion in the same quarter 2010. Net earnings stood at $3 billion and diluted net earnings for the quarter came in at $1.03 per share, an increase of 1%. Cash and cash equivalents increased to $3.58 billion from $2.76 billion in the previous quarter.

For the second quarter of fiscal 2012, net sales and organic sales growth are estimated in the 3% to 5% range. Diluted net earnings per share and core EPS are expected to be in the range of $1.05 to $1.11. For fiscal 2012, diluted EPS from continuing operations and core EPS are expected between $4.17 and $4.33, up 6% to 10%.

Of the 27 analysts covering the stock, 78% recommend a buy and 15% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 9.5% to $72.29 in the upcoming 12 months.

9. Enterprise Products Partners ( EPD) is a North American provider of energy services to natural gas and oil producers and consumers.

During third quarter 2011, the company paid a dividend of 61.25 cents per share, up 5.2% from 58.25 cents per share in the same quarter earlier year. EPD generated record distributable cash flow of $856 million during the quarter, vs. $573 million in the same period in 2010. Currently, the stock has a dividend yield of 5.3% and 5.3% one-year dividend growth, as per data compiled by Bloomberg.

Total revenue for the quarter was $11.3 billion, up 40.2% from $8.06 billion in the year-ago quarter. Net income grew to $480 million, or 55 cents per diluted share, from $348 million, or 18 cents, in the same quarter prior year. Net operating cash flow stood at $473.7 million during the quarter. During the quarter, total natural gas pipeline volumes increased 5% to a record 13.4 trillion British thermal units per day. NGL fractionation volumes increased 16% to a record 554 thousand barrels per day for the quarter.

The company has announced plans to design, construct and operate a long-haul pipeline to transport ethane from the Marcellus and Utica shale plays in Pennsylvania, West Virginia and Ohio to the U.S. Gulf Coast. Recently, EPD announced plans to expand and extend a seaway crude oil pipeline that will help ease the glut of crude at Cushing, Okla.

Of the 22 analysts covering the stock, 86% recommend a buy and 9% rate a hold. A consensus forecast of analysts polled by Bloomberg has average 12-month price target of $49.69 for the stock, about 10.4% higher than the current price.

8. Intel ( INTC) designs and builds microchips that serve as the foundation for many of the world's computing devices.

Intel paid fourth-quarter dividend of 21 cents per share, up from 15.75 cents in the same period previous year. During the quarter, the company generated $6.3 billion in cash from operations, paid cash dividends of $1.1 billion, and used $4 million to repurchase 186 million shares of common stocks. Currently, the company is trading at dividend yield of 3.2% and 24.2% one-year dividend growth, as per data compiled by Bloomberg.

For the third quarter, the company reported $3.1 billion year-over-year revenue increase to $14.2 billion, up 28% from $11.1 billion in the year-ago quarter. Net income grew to $3.46 billion, or 65 cents per diluted share, increasing 17.2% from $2.95 billion, or 52 cents, in the corresponding quarter previous year. Cash and cash equivalents rose to $7.05 billion from $4.63 billion in the previous quarter.

For the fourth quarter, the company estimates revenue at $13.7 billion, plus or minus $300. Gross margin is expected at 64.5%, plus or minus a couple of percentage points. Recently, INTC announced the acquisition of Infineon Technologies' AG Wireless Solutions business.

Of the 53 analysts covering the stock, 55% recommend a buy and 36% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 11.9% to $26.51 from the current levels over the next 12 months.

7. Solar Capital ( SLRC) is an investment company for leveraged, middle-market companies. Solar Capital's investment objective is to generate both current income and capital appreciation through debt and equity investments.

The company declared a quarterly dividend of 60 cents per share payable Dec. 29 to shareholders of record Dec. 15. Net operating cash stood at $32.5 million as of Sept. 30. Currently, the company is trading at a dividend yield of 13.9% and 12.1% one-year dividend growth, as per data compiled by Bloomberg.

For the third quarter, the company reported investment income of $35.3 billion from $29.4 billion in the third quarter of 2010. Net investment income for the company grew 32.7% to $20.7 billion, compared to $15.6 billion in same quarter last year. Total investment value was about $1 billion at the end of the quarter and $976.2 million as of Dec. 31, 2010. Cash and cash equivalents stood at $233 million at the end of the quarter.

Recently, the company announced that a new lender has committed $50 million to its senior secured credit facility, bringing total commitment under the agreement to $405 million and the facility will mature in Feb. 2013 and with scope for expansion to $600 million.

Of the 11 analysts covering the stock, 64% recommend a buy and 36% rate a hold. A consensus forecast of analysts polled by Bloomberg has average 12-month price target of $24.78 for the stock, about 15.2% higher than the current price.

6. Energy Transfer Equity ( ETE) is a Texas-based natural gas and propane provider.

The company paid a dividend of 62.5 cents during the quarter to shareholders, an increase of 11.6% from the first quarter of 2011. Distributable adjusted cash flow for the company was $126.4 million at the end of the quarter, compared to $125.2 million on Sept. 30, 2010. Currently, the stock is trading at a dividend yield of 5.7% and 8.8% one-year dividend growth, according to data compiled by Bloomberg.

For the third quarter, ETE reported total revenue of $2.09 billion, up 32.2% compared to $1.58 billion in the same quarter a year ago. Net income attributable to partners grew to $69.1 million, or 31 cents per share, from negative earnings of $4.8 million, or 7 cents during the quarter. Cash and cash equivalents increased to $167.7 million at the end of the quarter from $86.2 million from Dec. 31, 2010.

With the addition of new fee-based projects, the company's stable cash flow profile and EBITDA is seen expanding over the next few years. The company expects to achieve and maintain distribution coverage ratio of 1.05 times. Total debt-to-adjusted EBITDA is pegged at 4 times to 4.25 times. Growth expenditure for 2012 is seen between $1.3 billion and $1.6 billion.

Of the eight analysts covering the stock, seven recommend a buy and one rates a hold. Analysts polled by Bloomberg foresee the stock gaining an average 15.5% to $46.00 from the current levels in the next 12 months.

5. Linn Energy ( LINE), an independent oil and natural gas company with properties in five regions: Mid-Continent Deep, Mid-Continent Shallow, Louisiana and Illinois, Permian Basin, and California.

In November, the company paid its cash distribution of 69 cents per unit for its third quarter, or $2.76 per unit, on an annual basis. This compares to its first quarter distribution of 66 per unit. Currently, the stock is trading with a dividend yield of 7% and one-year dividend growth of 5.9%, as per data compiled by Bloomberg.

For third quarter 2011, the company recorded net income of $837.6 million, compared to $4.14 million in the same quarter last year. Adjusted EBITDA for the quarter increased 30% year-over-year for the quarter. Net cash provided by operating activities stood at $183 million, vs. $108 million in the year-ago quarter. As of Sept. 30, the company reported strong liquidity position with $1.4 billion.

The company recently announced 2012 oil and natural gas capital program of $880 million, focused on low-risk, high-rate-of-return liquids drilling. LINE is likely to drill or participate in almost 340 wells in 2012. For fiscal year 2012, the company estimates distributable cash flow per unit of $3.30 with a distribution coverage ratio of 1.20 times.

Of the 14 analysts covering the stock, 86% recommend a buy and the rest rate a hold. There are no sell ratings on the stock. Analysts polled by Bloomberg foresee the stock gaining an average 15.8% to $44.22 in the upcoming 12 months.

4. Qualcomm ( QCOM) designs, manufactures and markets digital wireless telecommunications products and services based on its code division multiple access technology and other technologies.

In October, the company announced a quarterly cash dividend of 21 cents. Currently, the stock is trading with a dividend yield of 1.5% and one-year dividend growth of 12.8%, as per data compiled by Bloomberg.

Revenue for fiscal 2011 stood at $15.0 billion, up 31.3%, while net income was up 43% to $4.3 billion. Cash and cash equivalents at the end the year increased to $5.4 billion from $3.5 billion, up 54% compared to fiscal 2010.

For full year 2012, QCOM expects revenue in the range of $18 billion to $19 billion and diluted EPS of $2.80 to $3.00. For the first quarter of 2012, it expects revenue between $4.35 billion and $4.75 billion and diluted EPS of 70 cents to 76 cents.

In November, the company acquired HaloIPT and its wireless electric vehicle charging technology.

Of the 44 analysts covering the stock, 84% recommend a buy and the rest rate a hold. There are no sell ratings on the stock. Analysts polled by Bloomberg foresee the stock gaining an average 24.4% to $66.54 in the upcoming 12 months.

3. Stryker ( SYK) offers orthopedic implants, as well as medical and surgical equipment. The company's makes implants used in joint replacement, trauma and spinal surgeries, patient handling and emergency medical equipment, endoscopic and communication systems, surgical equipment and surgical navigation systems and other medical devices.

The company has decided to raise its quarterly dividend by 18%, resulting in a quarterly dividend of 21.25 cents per share payable Jan. 31, 2012 to shareholders of record Dec. 29. Moreover, the company has decided to repurchase an additional $500 million common stock. Stryker has a current dividend yield of 1.5% and one-year dividend growth of 20%, according to a recent Bloomberg consensus.

Sales rose 14.9% year-on-year to $2.0 billion during the third quarter of 2011, as compared to $1.8 billion in 2010's same quarter. Net income stood at $327 million, or 84 cents per diluted share, compared to $337 million, or 85 cents per diluted share, in the year-ago quarter.

For full year 2011, the company estimates net revenue growth of 11% to 12%, vs. the earlier forecast of 11% to 13%. However, the company has raised its adjusted diluted net earnings per share to be in the $3.70 to $3.74 range, compared to the previous view of $3.65 to $3.73, up 11% to 12% from adjusted diluted net earnings per share of $3.33 in 2010.

Of the 35 analysts covering the stock, 80% recommend a buy and the rest rate a hold. There are no sell ratings on the stock. Analysts polled by Bloomberg foresee the stock gaining an average 25.6% to $61.02 over the next 12 months.

2. Southern Copper Corporation ( SCCO), produces copper, zinc, molybdenum, and silver. The company's mining, smelting and refining facilities are located in Peru and Mexico, and it conducts exploration activities in these countries and Chile.

In the last week of October, the company decided to distribute an interim dividend payment for fiscal year 2011 at the overall value of $588.7 million, representing 70 cents per share, payable Nov. 29 to shareholders of record Dec. 16. The company has a current dividend yield of 7.3% and one-year dividend growth of 46.4%, according to a recent Bloomberg consensus.

For the third quarter of 2011, sales rose 38.8% year-on-year to $1.7 billion, compared to $1.3 billion in the same quarter prior year. Copper mine production grew 24.4% year-over- year, while anodes, cathodes and rod production increased 82%, 62% and 82.2%, respectively. Net income improved 81.5% year-over-year to $663 million, or 79 cents per share, vs. $365.2 million, or 43 cents per share, during the same quarter last year.

For full year 2011, the company estimates copper production at 630,000 tons.

Of the 18 analysts covering the stock, 56% recommend a buy and 39% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 26.3% to $37.98 in the upcoming 12 months.

1. VimpelCom ( VIP), a group of integrated telecommunications services operators, offer a range of wireless, fixed and broadband services in Europe and North America, Russia, Ukraine, the Commonwealth of Independent States, Africa and Asia.

For 2011, VIP has declared an interim dividend of 45 cents per ADS with an ex-dividend date of Nov. 29, 2011 payable before Dec. 31 to all shareholders of record Dec. 1. This compares to a final dividend of 15 cents per ADS paid for its 2010 results. Currently, the company is trading with a dividend yield of 13.2% and a one-year dividend growth of 70.2%, as per data compiled by Bloomberg.

For its third quarter 2011, the company reported net operating revenue of $6.09 billion, which compares to $2.82 billion recorded in the third quarter of 2010. Net cash from operating activities increased to $1.86 billion from $1.1 billion in the year-ago quarter. Mobile subscribers more than doubled to 199 million from 92 million in the same quarter last year.

Looking ahead, the company said it is seeking to make a dividend payment of 80 cents per common share between 2011 and 2013. Meanwhile, for 2012, with its operational excellence program in Russia it would deliver at least $0.16billion in savings. Vimpel aims to achieve capex/revenue (excluding licenses) of below 15% by 2014 end.

Of the 21 analysts covering the stock, 62% recommend a buy and 33% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 55.9% to $14.79 in the upcoming 12 months.

>>To see these stocks in action, visit the Top 10 Dividend Stocks portfolio on Stockpickr.