My Favorite Top 11 Dividend Stocks

by: Todd Johnson

In this article I have highlighted my current top 11-dividend stocks. I have become more defensive in my positions. The overall stock market has had a few solid days this week. Due to quarter ending approaching and Treasury Bonds yielding low rates, a rebalancing into equities is likely the culprit.

I have left out agency mortgage real estate investment trusts. I remain long the core agency mREIT names. My plan is to focus upon their corporate conference calls to determine reasonable dividend expectations for the upcoming quarters.

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Philip Morris International, Inc. (NYSE:PM)

Philip Morris International is the must own name in our current economic environment. The company sells, and distributes a tobacco products in markets outside the United States. Philip Morris's operations are based in Lausanne, Switzerland. Philip Morris International's core brands include Marlboro, Philip Morris, Chesterfield, Parliament, L&M, and Bond Street. Altria (NYSE:MO) sells these brands within the U.S.

Philip Morris, on September 14th, increased the company's regular quarterly dividend by 20.3%, to an annualized rate of $3.08 per common share. This equates to a 77-cent quarterly dividend. Philip Morris continues to buyback shares at a current rate of $5-billion per year.

ConocoPhillips (NYSE:COP)

ConocoPhillips (COP) is an integrated oil and petrochemicals company with assets across the globe. ConocoPhillips announced plans to spin off its refining and marketing business into a separate publicly traded entity through a tax-free transaction to ConocoPhillips (COP) shareholders. The deal is expected to close by June 30, 2012. The stock yields a 4.1% dividend yield until the unlocking of spin off value occurs in 2012.

I explore the spin off benefits n the article: ConocoPhillips Spin-Off Will Create Larger Dividend Stream.

Verizon Communications Inc. (NYSE:VZ)

Verizon Communications Inc. (VZ) offers a 5.5% annual dividend yield. The company is focused on investing to growing markets. The smart phone segment continues to excel with the Android-platform and the upcoming iPhone 5. The company is in the midst of rolling out the 4G-LTE (fourth generation, Long Term Evolution) wireless broadband network. The VZ Wireless 4G LTE service is currently available in 100-markets in the U.S. The total market exposure should be approaching 200-markets by March 2012.

Southern Company (NYSE:SO)

Southern Company (SO) has four operating subsidiaries which provide electricity to 4.4 million customers. The core operating regions are located in Georgia, Alabama, Florida, and Mississippi. The four regions are Alabama Power, Georgia Power, Gulf Power, and Mississippi Power. Southern Company has paid dividends for 255-consecutive quarters going back to 1948. The current dividend yield is 4.5%. The business model is a necessary expense in the growing south eastern region of the U.S.

Enerplus Corporation (NYSE:ERF)

Enerplus Corporation (ERF) is a Canadian corporation with oil and gas production operations in the U.S. and Canada. Enerplus Corporation has operations in western Canada, Montana, North Dakota, Pennsylvania, Maryland, and Delaware. The stock pays an annual 8.6% dividend yield. Dividends are paid monthly.

Linn Energy, LLC (LINE)

Linn Energy, LLC (LINE) mission statement is to purchase, develop and develop free cash flow for the benefit of LINE shareholders. Linn Energy, LLC focuses upon developing a portfolio of long-life oil and natural gas assets. The company currently pays an annual 7.6% dividend yield. Linn Energy, LLC hedges production output to maintain a stable dividend policy.

Lorillard, Inc. (NYSE:LO)

Lorillard, Inc. (LO) is a producer and marketer of tobacco products. The company is the third largest manufacturer in the U.S. Lorillard's core brands include Newport, Kent, and True. Newport is Lorillard's flagship brand with approximately 90% of the company's 2010 revenues. Newport is a menthol flavored premium cigarette brand. Lorillard, Inc. aggressively buys back shares and increases its dividend. The current dividend yield is 4.7%.

Vodafone Group plc (NASDAQ:VOD)

Vodafone Group plc (VOD) offers mobile telecommunication services worldwide to 370-million customers. Vodafone Group has business operations in 26 countries. Vodafone Group owns 45% of Verizon Wireless. The country revenue breakdown includes the following percentages: Germany, 17%; Spain, 11%; Italy, 12%; U.K., 11%; India, 8%, and other, 41%.

Vodafone Group offers a very attractive 7.6% dividend yield. The strength in the 45% Verizon Wireless position cannot be minimized. The U.S. market share is growing and profitable to Vodafone Group's bottom line. Vodafone Group is a $132-billion market cap company that offers a necessary utility, telephone service, on a global basis. This is a quality name and a must own name for safe dividend seekers. Temporary price weakness can be attributed to the U.S. dollar strength and stress in the Euro currency.

AT&T, Inc. (NYSE:T)

AT&T, Inc. (T) offers telecommunication services to consumers, businesses, and other service providers worldwide. The company has a pending $39 billion acquisition of T-Mobile USA from Deutsche Telekom AG. The Department of Justice currently has put up the "hold on" sign. In the worst case scenario, AT&T would owe Deutsche Telekom a break-up package worth $7 billion, including $3 billion in cash. The AT&T and DOJ lawyers are currently negotiating the terms of approval, if such an approval is on the table.

The deal would provide AT&T subscribers to become the number one wireless company in the world. AT&T would have 130-million subscribers. Verizon has 100-million subscribers. I believe the deal happens although with some concessions made by AT&T. AT&T provides an ample 6.1% dividend by one of the premiere safe stocks in the world.

Gabelli Global Gold, Natural Resources & Income Trust (NYSEMKT:GGN)

Gabelli Global Gold, Natural Resources & Income Trust (GGN) is a closed end fund that owns gold and natural resource stocks. The fund makes money by capital appreciation in its stock holdings and by covered-call selling strategies. The dividend yield is 11.5%. The fund pays a monthly dividend of 14-cents.

CVR Partners, LP (NYSE:UAN)

CVR Partners, LP (UAN) is a pure-play nitrogen fertilizer company, including ammonia and urea ammonium nitrate. The fertilizer demand continues to be strong as worldwide populations expand. Due to acreage being limited, fertilizer serves as a tool to maximize crop production. The annual yield is 6.6%.

Stonemor Partners LP (NYSE:STON)

Stonemor Partners LP (STON) is the second largest owner and operator of cemeteries in the United States. Stonemor Partners LP has over 250-cemeteries in 25-states and Puerto Rico. As of December 31st, 2010, Stonemor Partners LP owned 236 cemeteries. Stonemor Partners LP manages the remaining number of cemeteries for non-profit corporations. The company pays an 8.1% annual dividend.

Disclosure: I am long VOD, PM, T, LO, SO, GGN, ERF, STON, LINE, COP, UAN.