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If you’re interested in stocks paying dividend income but don’t know where to start your search, one idea is to look at what the ‘smart money’ is buying.

With this idea in mind, we ran a screen on the S&P 500 (NYSEARCA:SPY) for large-cap stocks paying dividend yields above 1% and sustainable payout ratios below 50%. We then screened this universe for stocks seeing significant net institutional purchases over the current quarter.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

Do you think these stocks will outperform like the smart money predicts? Use this list as a starting point for your own analysis.

List sorted by dividend yield.

1. Entergy Corporation (NYSE:ETR): Operates as an integrated energy company in the United States. Market cap of $12.47B. Dividend yield at 4.69%, payout ratio at 41.72%. Net institutional shares purchased over the current quarter at 1.9M, which is 1.08% of the company's 175.48M share float. The stock has gained 5.29% over the last year.

2. International Paper Co. (NYSE:IP): Operates as a paper and packaging company with operations in North America, Europe, Latin America, Russia, Asia, and north Africa. Market cap of $12.15B. Dividend yield at 3.78%, payout ratio at 27.17%. Net institutional shares purchased over the current quarter at 4.8M, which is 1.11% of the company's 433.47M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.2). The stock has gained 7.84% over the last year.

3. Edison International (NYSE:EIX): Engages in the supply of electric energy in central, coastal, and southern California. Market cap of $12.70B. Dividend yield at 3.34%, payout ratio at 43.05%. Net institutional shares purchased over the current quarter at 3.4M, which is 1.05% of the company's 325.03M share float. The stock has gained 5.1% over the last year.

4. Williams Companies, Inc. (NYSE:WMB): Engages in finding, producing, gathering, processing, and transporting natural gas primarily in the United States. Market cap of $18.47B. Dividend yield at 3.19%, payout ratio at 37.77%. Net institutional shares purchased over the current quarter at 35.0M, which is 5.97% of the company's 586.50M share float. The stock has gained 33.3% over the last year.

5. Microsoft Corporation (NASDAQ:MSFT): Develops, licenses, and supports a range of software products and services for various computing devices worldwide. Market cap of $214.59B. Dividend yield at 3.14%, payout ratio at 24.37%. Net institutional shares purchased over the current quarter at 89.0M, which is 1.18% of the company's 7.55B share float. The stock has lost 3.88% over the last year.

6. Fifth Third Bancorp (NASDAQ:FITB): Operates as a diversified financial services holding company in the United States. Market cap of $11.25B. Dividend yield at 2.62%, payout ratio at 18.13%. Net institutional shares purchased over the current quarter at 17.8M, which is 1.94% of the company's 916.72M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.18). The stock has lost 14.12% over the last year.

7. Omnicom Group Inc. (NYSE:OMC): Provides advertising, marketing, and corporate communications services. Market cap of $12.07B. Dividend yield at 2.28%, payout ratio at 29.02%. Net institutional shares purchased over the current quarter at 3.9M, which is 1.43% of the company's 272.61M share float. The stock has lost 3.78% over the last year.

8. Lowe's Companies Inc. (NYSE:LOW): Operates as a home improvement retailer in the United States, Canada, and Mexico. Market cap of $30.93B. Dividend yield at 2.27%, payout ratio at 36.09%. Net institutional shares purchased over the current quarter at 18.5M, which is 1.48% of the company's 1.25B share float. The stock has gained 0.9% over the last year.

9. Newmont Mining Corp. (NYSE:NEM): Engages in the acquisition, exploration, and production of gold and copper properties. Market cap of $35.51B. Dividend yield at 2.14%, payout ratio at 16.67%. Net institutional shares purchased over the current quarter at 9.9M, which is 2.00% of the company's 493.99M share float. The stock has gained 7.28% over the last year.

10. U.S. Bancorp (NYSE:USB): Provides various banking and financial services in the United States. Market cap of $49.69B. Dividend yield at 1.92%, payout ratio at 18.63%. Net institutional shares purchased over the current quarter at 21.4M, which is 1.12% of the company's 1.91B share float. The stock has gained 1.17% over the last year.

11. Monsanto Co. (NYSE:MON): Provides agricultural products for farmers in the United States and internationally. Market cap of $36.96B. Dividend yield at 1.74%, payout ratio at 38.07%. Net institutional shares purchased over the current quarter at 10.5M, which is 1.97% of the company's 534.02M share float. The stock has gained 15.03% over the last year.

12. Ecolab Inc. (NYSE:ECL): Develops and markets products and services for the hospitality, food service, healthcare, and industrial markets primarily in the United States. Market cap of $12.84B. Dividend yield at 1.45%, payout ratio at 32.16%. Net institutional shares purchased over the current quarter at 16.7M, which is 7.93% of the company's 210.51M share float. The stock is a short squeeze candidate, with a short float at 12.82% (equivalent to 9.4 days of average volume). The stock has gained 14.58% over the last year.

13. Intuit Inc. (NASDAQ:INTU): Provides business and financial management solutions for small and medium-sized businesses, consumers, accounting professionals, and financial institutions in the United States, Canada, India, and the United Kingdom. Market cap of $15.71B. Dividend yield at 1.14%, payout ratio at 7.03%. Net institutional shares purchased over the current quarter at 3.6M, which is 1.30% of the company's 276.61M share float. The stock has gained 9.74% over the last year.

14. News Corp. (NASDAQ:NWSA): Operates as a diversified media company worldwide. Market cap of $43.99B. Dividend yield at 1.09%, payout ratio at 21.54%. Net institutional shares purchased over the current quarter at 26.5M, which is 1.24% of the company's 2.14B share float. The stock has gained 22.97% over the last year.

Institutional data sourced from Fidelity, all other data sourced from Finviz.

Disclosure: Author owns shares of EIX and has no plans to change his position in the next 72 hours.

Source: 14 Large-Cap S&P 500 Dividend Stocks Being Bought Up By Hedge Funds