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It seems perfectly logical for income investors who like to invest for dividend payments look to companies with a significant cash balance - these companies are financially strong and have to put this cash to use. Companies are making good use of that cash, and often returning it to shareholders via dividends or buybacks. In fact, the percentage of dividend paying issues in the S&P 500 reached 81.2%, a level not seen since November 1999, while all 30 members of the Dow Jones industrial average pay dividends as well.

During the first quarter of 2013, 944 dividend increases were reported, a 39.4% gain over the 677 dividend increases reported during the first quarter of 2012 according to Standard & Poor's. For the 12 months ending March 2013, there were 3,154 positive dividend events compared to 2,120 such events in the prior 12 months, a 41.8% increase.

Investors can ride this trend by filtering for companies with a large amount of cash, current high dividend yield and a buy or strong buy rating from analysts. Here is a short list to consider:

China's CNOOC (CEO) has $21.5 billion in cash and a current dividend yield of 3.26%. CNOOC engages in the exploration, development, production and sale of crude oil, natural gas, and other petroleum products. CNOOC recently announced that as a result of an increase in oversea production following the acquisition of Nexen (NXY) oil and gas revenues are up 13% for Q1 2013 from the same quarter last year. Total output was up 17% for the same time period. Still, the stock is down 10% in the past year. First Call has a strong buy recommendation with a 1.3 rating. CNOOC goes ex-dividend on May 28, 2013, as dividends are paid on a semi-annual basis.

Tech giant Cisco Systems (CSCO) has $46.4 billion in cash and a current dividend yield of 3.27%. Cisco's revenues in the second quarter of fiscal 2013 increased 5.2% year over year and 1.7% sequentially to $12.1 billion. Products (78.0% of total revenue) were up 3.3% year over year to $9.4 billion. Services (22.0% of total revenue) jumped 12.5% year over year to $2.7 billion. The company has a market cap of $111.07 billion and is a part of the technology sector. Investors can see its P/E ratio is 11.97, which is below the S&P 500's 17.7. First Call has a buy recommendation with a 2.2 rating.

Nippon Telegraph and Telephone Corporation (NTT) has $12.5 billion in cash and a current dividend yield of 3.76%. Nippon has a 5-year average annual dividend growth rate of 16%. Nippon provides fixed and mobile voice related services, IP/packet communications services, telecommunications equipment, and system integration and other telecommunications-related services in Japan. While Nippon is trading near its 52-week high, it still offers significant value. The stock is trading at a price earnings ratio of 9.66 and a price to sales ratio of 0.60. First Call has a strong buy recommendation with a 1.0 rating.

Total SA (TOT) has $22.5 billion in cash and a current dividend yield of 7.43%. Total operates as a oil and gas company worldwide. The company operates in three segments: Upstream, Refining and Chemicals, and Marketing and Services. The stock is up 8% in the past year and offers great value. Following the earnings miss, the company reiterated its target to grow oil and gas output by 3% a year on average between 2011 and 2015, and accelerate growth further after 2017 as new projects come on stream. The stock is trading at a price earnings ratio of 8.08 and a price to sales ratio of 0.47. First Call has a buy recommendation with a 2.0 rating.

Source: Stocks With Billions In Cash, High Yield Dividends And Buy Recommendations