5 Dividend Stocks, 4 With Earnings to Keep Paying

NEW YORK (TheStreet) -- Buying dividend-paying stocks has many advantages. Historically, dividendpaying stocks outperform non dividend paying stocks. Each time a dividend is paid, the total capital at risk decreases. If a stock dividend is 3% and the company never adjusts their payment up or down in real dollars (not likely, but we will assume so for illustration purposes) the company will pay you back in full for your purchase in about 23.5 years. At 4%, it takes less than 18 years.

Investors always have to be cautious when reviewing high-yielding stocks. Dividends gained have been known to vaporize quickly into losses with companies that cut back the payment. A company's board of directors generally authorizes dividend payments every quarter, and there are no rules that say they must continue payments if they do not believe dividend payments are in the best interest of the shareholders and company.

Garmin might not be a first pick for a stock to buy for dividends, but is a good one to watch.

Here we are looking at stocks offering a good yield, no debt and with ample profits expected to keep the dividend revenue steam flowing. Similar to any other company, the situation can change rapidly resulting in greater or lower returns.

I sorted the list based on the size of the company:

American Eagle Outfitters(AEO) together with its subsidiaries, operates as an apparel and accessories retailer in the United States and Canada. American has more than $3 billion in sales per year, with rising revenue. The payout ratio is 57%, forward-looking annual dividend is 44 cents per share, for a yield of 2.2% and there's $53 million in total free cash flow for 27 cents per share.