5 Hot Dividend Stocks

Many people labor under the delusion that dividends are no longer important.

That's simply wrong. Over the past 20 years, dividends - and the reinvestment of those dividends - accounted for 32 percent of the total return from stocks. And this in a time when many investors scorned dividends as obsolete!

Over the previous 50 years (Sept. 30, 1937, through Sept. 30, 1997), dividends directly and indirectly accounted for well over half of stocks' total return.

Rising dividends not only put money in your pocket. They also testify that management believes a company's prospects for growth are sustainable. They are a sincerity barometer that tells you management is putting money where their mouth is.

For a stock to have dividend appeal to me, it should display both an above-average yield and a rising dividend. Here are five stocks that I believe have dividend appeal.

9 Top Picks From Goldman's Dividend Growth Basket

Dividends are so important for income investors, especially when you reinvest all of your fresh dividend payment to fund new stock positions.

Overall, dividends will provide about half the total returns for equity investors in the next decade, that's a major guide each analyst tells you when we are discussing the dividend growth strategies.

Today I like to refer a great basket from Goldman Sachs, the Dividend Growth Basket. Each stock of the list has a median yield of 2.5% and is expected to increase dividends by 16% in 2015 and 12% in 2016. The basket has a price-to-earnings ratio of 15 vs. 17.3 for the S&P.

That sounds very interesting, right? Well let us look at the detailed results. Here are the best picks from each industry. Which do you like?