Top 10 Dividend Stocks for September

Protect Yourself With Dividends

The month got off to a less than auspicious start with the Dow Jones Industrial Average falling almost 120 points on Sept. 1. After the late August rally, such a pullback was to be expected, but September is historically the toughest month of the year for the Dow. It is possible that the market will continue to climb, but it is in your best interest to have hedging tools you can use to counteract sudden market downturns like the one that hammered stocks in early August.

One of the best strategies for a difficult market such as this one is to own high-yielding dividend stocks. In addition to high yields, dividend safety should be another top concern for income investors. And finally, you want to make sure that you pick sectors that will hold up well in these economically challenging times.

And that’s exactly what we’ve done for you. Here are our top dividend stocks to buy for September:

Dividend Stock to Buy #1 – Plains All-American Pipeline LP

Recommended by: Richard Band, Editor, Profitable Investing

Plains All-American Pipeline LP (NYSE:PAA) owns 16,000 miles of pipeline carrying crude oil and refined products. On Aug. 11, PAA announced a secondary offering of partnership units by one of its large shareholders. As usually happens when a fresh supply of master-limited partnership (MLP) units hits the market, the share price temporarily dipped, driving up the yield for new buyers.

PAA currently yields a juicy 6.6%, and the partnership has doubled its payout in the past 10 years. Just imagine how happy you’ll be if Plains can pay you 13% by 2021! Buy PAA at $63 or less.

Dividend Stock to Buy #2 – Piedmont Natural Gas

Recommended by: Richard Band, Editor, Profitable Investing

Piedmont Natural Gas (NYSE:PNY) is an energy services company that distributes natural gas to residential, commercial, industrial and power generation customers in portions of North Carolina, South Carolina, and Tennessee.

It is an ultra-well-financed outfit, and because of its exceptionally strong balance sheet and growth outlook, PNY’s share price seldom drops into the bargain bin. Buy PNY on pullbacks to $29 or less, where the yield rises to 4%.

Dividend Stock to Buy #3 – NextEra Energy

Recommended by: Richard Band, Editor, Profitable Investing

Electric, gas and water companies provide an essential service — and many of the stocks have backtracked recently into an attractive buying range.

Florida-based NextEra Energy (NYSE:NEE) engages in the generation, transmission, distribution and sale of electric energy in the United States and Canada. NEE is also the nation’s leading producer of renewable power, and is among the strongest utility stocks you can own.

NextEra yields almost 4%. Buy it on a pullback to $55.

Dividend Stock to Buy #4 – Duke Energy

Recommended by: Richard Young, Editor, Intelligence Report

Upon completion of the Progress Energy merger, Duke Energy (NYSE:DUK) will be the nation’s largest utility. The combined Duke-Progress Energy will serve nearly all of North Carolina and approximately half of South Carolina, Florida and Indiana, plus small portions of Ohio and Kentucky. Duke’s generation portfolio will include 57 gigawatts of capacity across coal (42%), nuclear (6%), natural gas and oil (35%), and renewables (7%).

The stock currently yields 5.3%.

Dividend Stock to Buy #5 – Philip Morris International

Recommended by: Louis Navellier, Editor, Blue Chip Growth

Philip Morris International (NYSE:PM) owns seven of the top 15 tobacco brands in the world, and held about a 16% share of the total cigarette market outside of the United States in 2010.

PM is a great stock for times like these, because during bumpy markets, cigarette makers don’t get hit nearly as hard as the rest of the consumer goods sector. After all, smoking is a widely used stress reliever, and smokers are unlikely to cut back too much in times of crisis. This dividend stock currently yields 3.7%.

Dividend Stock to Buy #6 – Altria Group

Recommended by: Louis Navellier, Editor, Blue Chip Growth

Altria Group (NYSE: MO) is the largest tobacco company in the United States, controlling about half of the U.S. tobacco market. The company’s most popular brand — Marlboro — has been the world’s most successful.

MO has outperformed the S&P 500 every year since 2000, and was ranked No. 1 in the 2010 Barron’s 500, an annual list of the top-performing companies in the country. Altria Group is also known for its hefty dividends, which it has increased 44 times in the past 42 years. The stock currently yields over 6%.

Dividend Stock to Buy #7 – Reynolds American

Recommended by: Louis Navellier, Editor, Blue Chip Growth

The third and final cigarette maker on our list of top dividend stocks to buy is Reynolds American (NYSE:RAI). Reynolds is the second-largest tobacco manufacturer in the United States, and was created from the merger of R.J. Reynolds Tobacco Holdings and Brown & Williamson.

Although its most recent earnings were a bit disappointing, the fundamentals on this large-cap stock remain strong. And its dividend is stronger still. RAI will pay a dividend yield of 5.7% on Oct. 3 to shareholders of record as of Sept. 12, for a total (annualized) dividend of $2.12 per share.

Dividend Stock to Buy #8 – Triangle Capital Corp.

Recommended by: Bryan Perry, Editor, Cash Machine

Triangle Capital Corp. (NYSE: TCAP) is a private equity and venture capital firm specializing in buyouts, change of control transactions, acquisitions, growth financing and recapitalizations in lower middle market companies. It is enjoying strong deal flow and getting excellent terms for its financing of small-to-medium sized private companies that seek capital to expand their business.

TCAP recently posted huge Q2 numbers, earning 55 cents per share, or 11 cents ahead of estimates and 124% higher than in Q2 2010. Top-line growth jumped by 97%, and management raised the quarterly dividend by 2 cents per share to 44 cents. TCAP currently yields over 10%.

Dividend Stock to Buy #9– Verizon Communications

Recommended by: Bryan Perry, Editor, Cash Machine

With the adoption of the immensely popular Apple (NASDAQ:AAPL) products in their wireless lineup, Verizon Communications (NYSE:VZ) is widening its lead on the competition. The company has the biggest footprint in the wireless industry, has the best bundled broadband/TV/wireline services package in the form of FIOS, and is sporting 40%-plus earnings growth as a result.

The market pullback has given investors an excellent entry point and a dividend yield of almost 5.5%.

Dividend Stock to Buy #10 – Intel

Recommended by: Richard Band, Editor, Profitable Investing

Thanks to the recent market slide, Intel (NASDAQ: INTC), the world’s largest semiconductor maker (and a cash cow), is yielding an outsized 4.2%. As Birinyi Associates points out, that’s a fatter dividend than you can get with a number of blue-chip utilities.

I’ve been critical of some of INTC’s high-priced acquisitions lately, but a bargain is a bargain! INTC merits a buy at $20.40 or less.

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