Barron's has a recent post about quality dividend stocks for retirement. They pick their top 10 favorites. Here is the second part of Barron's article which lists the B Team of dividend stock picks. 10 for the Money by Vito J. Racanelli

Which companies are worthy of a retiree's income portfolio? Barron's has selected 10 for the A team, plus a second 10 that didn't quite make the cut, but easily could have. The A team is listed in the table, The Best Bets; the B Team is in the table, Lots of Bench Strength.

Company (Ticker) Yield
Abbott Labs (ABT) 3.0%
AT&T (T) 6.3%
Coca-Cola (KO) 2.9%
Emerson Electric (EMR) 3.2%
Lockheed Martin (LMT) 3.3%
Merck (MRK) 4.3%
Microsoft (MSFT) 1.7%
Telefonica ADR (TEF) 5.2%
United Tech (UTX) 2.3%
Wal-Mart (WMT) 2.0%

Disclosure: The Div Guy owns shares of ABT and T at the time of this post.

Barron's has a recent post about quality dividend stocks for retirement. They pick their top 10 favorites. 10 for the Money by Vito J. Racanelli

Special Report on Retirement: Folks approaching retirement should consider buying high-quality, dividend-paying stocks to bulk up their portfolios. Here are our top 10 picks.

Which companies are worthy of a retiree's income portfolio? Barron's has selected 10 for the A team, plus a second 10 that didn't quite make the cut, but easily could have.

Before we get into specifics, a little more background: A study of 1,000 Americans done by Scottrade in January found that 75% of the polled baby boomers --Americans born anytime from 1946 through 1964 -- fear that full retirement won't be an option for them.

If there is a silver lining, it's that it is probably an auspicious time for buying and holding large-cap, high-quality, dividend-paying and dividend-growing stocks. "Right now, you can find leading blue-chip, high-quality stocks at below-average multiples that are raising dividends," says John Carey, a fund manager at Pioneer Investments.

Banco Santander (STD)
With many of the biggest U.S. and European banks in trouble or under pressure, this Madrid-based giant offers financial strength and geographic diversity. In 2009, once again it will probably be one of the world's most profitable banks.

Chevron (CVX)
Big integrated energy outfits like this American oil explorer offer both a dollar hedge (because crude rises when the dollar falls) and exposure to two of the world's most important commodities: oil and natural gas.

Intel (INTC)
The premier maker of microprocessors, semiconductor chips, and sundry other computer and communications gear is involved in cyclical businesses, but that's about the worst you can say about it. Intel is the 800-pound gorilla in the industry, and its manufacturing-scale and global-reach advantages would be hard to replicate, even in the tech world, where change happens quickly.

Johnson & Johnson (JNJ)
This is perhaps the quintessential dividend stock. While J&J was named the most respected company in a recent Barron's poll, its stock doesn't get the respect it deserves. J&J manufactures everything from Tylenol and Band-Aids to high-tech orthopedic hip replacements and coronary stents, and numerous pharmaceuticals.

McDonald's (MCD)
Because its shares haven't done much in the past two years, few may know that the home of the Golden Arches has been the best-performing Dow industrial stock since 2002, up about 300% in that span. That's when the world's biggest fast-food chain slowed its expansion and redeployed its prodigious cash flow toward upgrading existing restaurants and menus, adding salads and fruits that customers wanted. All this boosted same-store sales sharply. McDonald's continues to add new items, such as premium Angus burgers and McCafe coffee.

Nestlé (NSRGY)
Like J&J, the Swiss behemoth is steady and solid as the tortoise in the race with the hare. The world's largest food processor boasts wide product diversity and geographic reach, in the West and in fast-growing emerging markets, where the company is making a big push. Its balance sheet is probably the strongest in the food industry, giving it the wherewithal to undertake bolt-on acquisitions.

Novartis (NVS)
This leading manufacturer of drugs -- from cardiovascular medicines like Diovan to oncology and neuroscience compounds, as well as vaccines and diagnostic tests and over-the-counter products such as Excedrin -- also gives international exposure and would help diversify a retirement portfolio away from the dollar. The Basel, Switzerland-based firm's American depositary receipts have a dividend yield of 3.2%, and the payout has risen, on average, 15% annually over the past five years.


PepsiCo (PEP)
In the never-ending cola wars, PepsiCo is our selection because it offers a bit more sales growth than Coca-Cola (KO), which made our second list. PepsiCo is expanding in fast-growing markets like Russia and China, and through the introduction of new products like naturally sweetened beverages, in an already-diverse portfolio, according to Bahl & Gaynor's McCormick.


Procter & Gamble (PG)
Cincinnati-based P&G is another of the U.S.'s great franchises, with a widely diverse manufacturing, product and customer base around the world. It would be difficult to find a country where it doesn't either make or sell one of its laundry, beauty-care, food or health-care products. The stock is just below the market multiple and little changed for the year, with a 2.8% yield, the highest it's been in some time, notes Pioneer's Carey. "It's a strong company in a lot of business areas."

Verizon Communications (VZ)
This telecom has the highest dividend yield in our bunch, 6.2%, because many investors fear it eventually won't be able to replace revenue from the industry's ongoing loss of land lines. But through its Verizon Wireless joint venture with Vodafone (VOD), Verizon is the largest U.S. wireless-service provider, notes Darren Pollock, a portfolio manager at Cheviot Value Management. "Verizon continues to add wireless subscribers at a good clip, even without the ability to offer hot products like Apple's iPhone." Its network is generally considered the most reliable in the U.S.

Disclosure: The Div Guy owns STD, JNJ, PEP and PG at the time of this post.

Barron's has an interesting article on Pepsi by By Jacqueline Doherty. Here are the highlights. At Pepsi, the Glass Is Half Full

Investors have turned their backs this year on consumer-staples stocks, while chasing after companies that promise faster growth. In PepsiCo's case, they've had added reason to look elsewhere, given declining revenue and profits in the company's North American beverage division -- home of Pepsi products, Gatorade sports drinks, Tropicana juices, Aquafina water and other familiar brands.

Pepsi has suffered as cash-strapped consumers have traded down to private-label products -- or quenched their thirst at the kitchen sink.

CEO Indra Nooyi's recent statement that Pepsi is targeting 11% to 13% growth next year in earnings per share, excluding the impact of currency translation, and assuming the bottling deals close on schedule, early in 2010.

"We see a path for double-digit earnings growth over the next three years," says Bill Pecoriello, CEO of ConsumerEdge Research, who has an Outperform rating and a 12-month price target of 72 on Pepsi's shares.

Mario Gabelli, chairman and CEO of Gamco Investors, which manages mutual funds, is even more optimistic, noting that in the next few years, "the stock [could] trade 50% to 60% higher, which, with the dividend, gives you a pretty good return."

Gabelli, whose funds own Pepsi shares, bases his analysis on what he thinks the company's parts could be worth in private-market transactions. Pepsi pays a dividend of $1.80 a share, and yields 2.8%.

As Pecoriello and other Pepsi fans see it, the company has many levers it can use to boost revenue and meet its earnings goals. Even if just a few of them work, PepsiCo's shares soon could be bubbling higher.

Disclosure: The Div Guy owns share of PEP at the time of this post.

Here are the top 20 stocks in my Dividend Portfolio as of 11/30/09 ranked by size of holdings.

1. Kinder Morgan Energy (KMP) USA
2. Barclays PLC (BCS) UK
3. DCP Midstream Partners (DPM) USA
4. HRPT Properties Trust (HRP) USA
5. Penn West Energy Trust (PWE) Canada
6. Procter & Gamble (PG) USA
7. General Electric Company (GE) USA
8. Johnson & Johnson (JNJ) USA
9. American Capital (ACAS) USA
10. Banco Santander (STD) Spain
11. Diana Shipping Inc. (DSX) Greece
12. ONEOK, Inc. (OKE) USA
13. Exxon Mobil Corporation (XOM) USA
14. Cooper Tire & Rubber (CTB) USA
15. GlaxoSmithKline (GSK) UK
16. Aircastle Limited (AYR) USA
17. Deutsche Bank (DB) Germany
18. Seagate Technology (STX) USA
18. Pfizer. (PFE) USA
20. Duke Energy Corporation (DUK) USA

Here are the top 10 holdings of the Vanguard High Dividend Yield Index ETF. The fund employs a “passive management”—or indexing—investment approach designed to track the performance of the FTSE® High Dividend Yield Index. Holdings as of 10/31/09:

1 Johnson & Johnson
2. JPMorgan Chase & Co.
3. Chevron Corp.
4. AT&T Inc.
5. General Electric Co.
6. Pfizer Inc.
7. Wells Fargo & Co.
8. Bank of America Corp.
9. Coca-Cola Co.
10. Intel Corp.

My Annualized Dividend Income as of the end of November increased to $5,448 from $5,381 for the month. This means my dividend stocks will pay $5,448 in dividends over the next 12 months.

I made a few dividend stock purchases over the past month from dividend distributions. It looks like the economy is showing some signs of stabilizing and we will have fewer dividend cuts for the rest of the year.

My Dividend Income Goal for 2009 was $7,000 in yearly dividend income but due to the poor economy and dividend cuts, I have now revised that goal, I think $5,500 would be a much more realistic and challenging goal over the next few months.

Most of my stocks are held in my Zecco Trading account and the rest are DRIPs. The dividends from my stocks are reinvested but I am keeping track of the amount of income I could receive once I retire or choose to receive the dividends in cash.

I will post my Top 20 Stock Holdings on Thursday.

As of the end of November our Net Worth increased to $770,689 from $747,078 for the month which is a 3.16% increase. The markets took a little hit the other day from the Dubai fallout but we are still waiting to see if the economy slowly starts to recover.

The breakout is as follows:
ASSETS
Retirement Accounts $382,311
Taxable Accounts $123,776
Cash $17,488
Home $205,000
Cars $8,750
Personal Property $3,000
Kids 529 Accounts $30,364

Here is the summary for this month:

Our Net Worth increased the past month due mostly to the raise in the stock market. We are now debt free since we paid off our credit card debt. We will continue to use our credit cards for rewards but payoff the balances each month. I received around $800 in dividends for the month and have used the cash from these dividends to make additional stock purchases of our dividend stocks but I have not been adding much extra money.

We will be building up our cash over the next few months to increase our cash reserves. You can click on my Net Worth graph on the right to see the changes in each category from the previous month. I continued funding our Roth IRA's each month.

I will post my Dividend Income Update on Wednesday.