Top 10 Dow Dividend Stocks for Retirement Investors

#3: Merck

Current Dividend Yield: 4.4%
Performance So Far in 2012: +1%

Merck (NYSE:MRK) is very similar to Pfizer in many ways. It barely is in the black year-to-date, and lagging the market. It has a dividend of more than 4%. It, too, faces patent expirations and is hoping its pipeline will step up to fill the void.

There obviously is not breakneck growth in pharmaceuticals, at least on a share appreciation basis. But the continued roll-in of the $41 billion Schering-Plough buyout from a few years ago surely will provide new opportunities for Merck. At the very least, it ensures the company won’t fade away.

And like its cohort Pfizer, MRK is sitting on a huge war chest. Some $13.5 billion in cash and $1.4 billion in short-term investments keeps this pick pretty safe when it comes to paying the dividends.