18 Dividend Stocks That Will Outlive the Hype

NEW YORK (TheStreet) -- With dividend investing suddenly in vogue, my inner contrarian shudders with every pro-dividend TV segment and newspaper headline.

"Leave my beloved dividend stocks alone!" -- I think and drift into memories of the good old days when the media celebrated cash-flow negative "growth" stocks and sneered at corporate bellwethers as "stodgy" and "grandfatherly."

But then my better judgment appeals to me: It's for the best.

Seth Klarman -- the famous and elusive value investor -- once asked himself an interesting question in the foreword of his hard-to-find book Margin of Safety:

"In writing this book, Don't I run the risk of encouraging increased competition, thereby reducing my own investment returns?" He then rationalizes, "I am pained by the disastrous investment results experienced by great numbers of unsophisticated or undisciplined investors."

I too am pained by the attitude that dividends are a harbinger of corporate doom, a sentiment that -- despite the growing popularity of dividends -- has left many investors conflicted.

First off, history is firmly on the side of dividend-paying stocks: collectively, they outperform. Second, why should the owner of a company only enjoy the fruits of corporate success by relinquishing ownership? This is perverse! If you love the company you own, you should profit more by owning more.

Lastly, dividends can save the world. It may sound ridiculous, but Benjamin Graham once posited that if all corporations maintained a generous dividend policy, then the likelihood of a banking crisis would slowly fade away.

When America's most credit-worthy corporations keep war chests to self-finance their own expansion, then bankers are left with fewer prudent investments (and too much time to get into mischief).