Increased dividend to $0.90 from $0.85 for shareholders of record on December 10.

Tobacco giant Reynolds raised its quarterly a nickel, to 90 cents a share, for a 7.62% yield. It was the company's first increase in more than two years.

Following up on TAP's sin-stock play, RAI is set to announce earnings this week.

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.

I always look at companies with business models that have predictable cash flows, explains Finerman. I like the tobacco names such as Reynolds [RAI], Altria [MO] and Philip Morris [PM] as well as companies in the liquor business such as Diageo [DEO].

Will Cigarette Companies Go Up In Smoke?: David Peltier, portfolio manager of the Dividend Stock Adviser, examines whether Altria and Reynolds American's high dividends can withstand a stock sell-off and skyrocketing cigarette prices.
Click here to watch the video.

7.63%

Old Investing Strategy Is in Again:
RealMoney contributor, Dan Dicker, says to return to the market plan of the 1950s and 1960s. Look for dividend producers, not growth stocks, to make money.

Click here to watch the video.

6.6%

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Tobacco Company

Div 4.6%

growth