Two exceptionally high payout ratios belong to Altria, maker of Marlboro cigarettes, and Reynolds American, producer of Camel and Winston brands. Both companies aim to distribute 75% of their profits in dividends. Many investors find the cigarette business distasteful, and the industry domestically is in decline, hurt by falling consumption and higher taxes. Yet cigarettes' addictive nature gives tobacco companies pricing power, even in a recession.

With the economy contracting, dividends are even more appealing to investors. Yet many are in jeopardy. Reynolds American offers the top yield among our picks.

The drug sector is well represented with industry leaders Merck, Bristol-Myers, Lilly and Pfizer. Dividends at all four look secure, although future payout increases could be muted by modest annual profit growth. The new Pfizer dividend of 64 cents annually, for a 4.5% yield, looks safe at just 30% of projected 2009 earnings. The negative investor reaction to the Pfizer payout cut may make other drug makers wary of reducing dividends.

The drug sector is well represented with industry leaders Merck, Bristol-Myers, Lilly and Pfizer. Dividends at all four look secure, although future payout increases could be muted by modest annual profit growth. The new Pfizer dividend of 64 cents annually, for a 4.5% yield, looks safe at just 30% of projected 2009 earnings. The negative investor reaction to the Pfizer payout cut may make other drug makers wary of reducing dividends.

The drug sector is well represented with industry leaders Merck, Bristol-Myers, Lilly and Pfizer. Dividends at all four look secure, although future payout increases could be muted by modest annual profit growth. The new Pfizer dividend of 64 cents annually, for a 4.5% yield, looks safe at just 30% of projected 2009 earnings. The negative investor reaction to the Pfizer payout cut may make other drug makers wary of reducing dividends.

Food makers Heinz and Kraft make our list with their 4.8% and 4.6% dividends, respectively. Heinz is expected to boost its dividend in May -- by a small amount. It has an above-average stable of brands and could be a takeover target, as we argued last month (see "Anticipating the Return of the Ketchup Kid," Jan. 26.)

Kraft has disappointed since its 2001 initial public offering, with the company unable to keep annual profit at more than $2 a share. This year doesn't promise to be any better. Kraft's stock, now 25, could be supported by its bond-like yield. Investors can buy the stock today for less than what Warren Buffett's Berkshire Hathaway paid for its stake of 132 million shares. Berkshire's average cost is $33 a share.

These 20 companies include Merck , Eli Lilly and Bristol-Myers in pharmaceuticals; Heinz and Kraft in food; Altria , Reynolds American and Lorillard in cigarettes, and Verizon Communications and AT&T in telecommunications.