Their are several different dividend strategies for picking stocks such as “The Dogs of the Dow”, “The Dow 5″ and “The Foolish 4″ (more on these another time). Each has its own variation for selecting stocks by their dividend yield. While some stocks with high yields indicate that the business itself maybe struggling, on the flip side it can be construed as a sign of strength. Many might swear by these mechanical stock picking methods, however their is more to choosing good quality stocks than just by using some mechanical formula. While  the dividend is one of the tools in choosing good quality stocks, it is only that, one tool. Highlighted below is a current list of Dow 30 stocks which are ranked  in order of  highest to lowest by dividend yield.

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With stocks rallying for over 3 months now, dividend yields continue to fall back to Earth.  Today, two new components join the Dow, one with a dividend and one without.  Travelers [TRV 43.44 -0.31 (-0.71%) ] has a yield of 2.74% while Cisco [CSCO 19.565 -0.305 (-1.53%) ], like many tech companies, does not pay a dividend.  Their combined dividends, however, are still higher than the two companies they are replacing, Citigroup [C 3.51 0.05 (+1.45%) ] and GM [GMGMQ 1.08 0.215 (+24.86%) ], thereby increasing the overall average for the Dow.  The average yield is now 3.11%, far from the 4.5% we saw in early March, but just below the 3.13% we saw one month ago.

Below is a table listing the yields of all 30 Dow components.  Since April, AT&T [T 24.1476 -0.4124 (-1.68%) ] continues to be the highest yielding stock on the Dow.  Verizon [VZ 29.075 -0.175 (-0.6%) ] has moved ahead of DuPont[DD 25.72 -1.28 (-4.74%) ] for second and third place.

By: Ariel Nelson Director of Market Data & Content Services via  cnbc.com