5 Dividend Stocks Getting Slaughtered -- Including 2 Potential Buys

Over the past several years, no type of stock has been more popular than the dividend-paying variety. Investors have been wooed by the guarantee of payouts that help secure their investments.

At the same time, however, shareholders need to realize that steep declines in the price of their shares could easily cancel out any gains they experience through dividends. Below I will highlight five popular dividend stocks that have taken steep falls lately, as well as their prognosis moving forward. At the end, I'll offer you access to nine company tickers that we believe represent excellent dividend opportunities.

EXCO Resources (NYS: XCO)
It's no secret that natural-gas companies are reeling from plummeting prices for their commodity. EXCO -- which has its hand in both oil and natural gas, offers a 2.7% dividend yield, and is down 70% from its 52-week high -- is no exception. The company's stock is highly levered to the ups and downs of natural gas's price.

Though the cheap natural gas could have a boomerang effect -- offering incentive for other industries to develop technologies that use the stuff, thereby increasing demand to meet supply -- it may be too early to jump in right now. For now, I'd stay on the sidelines with this one.

Nokia (NYS: NOK)
This cellphone maker from Finland has certainly seen better days. Not only are its core cheap feature phones on a decline, but a glitch in the much-hyped Lumia 900 is giving the company headaches. Nokia currently offers a 4.3% dividend, but that may have something to do with the fact that it's down more than 50% since a year ago.

The Lumia was supposed to be the first big step in a turnaround for the company, and problems with high-speed data connection drops are just embarrassing. With Apple and Google currently dominating the smartphone market -- with a combined 80% share -- mistakes like these will make it that much harder for Nokia to compete. They could still turn things around, but they aren't getting my vote of support right now.

Banco Santander (NYS: STD)
Get prepared for a shocker: Banks in Europe aren't doing too well -- at least, on the stock market. I know, big surprise, right? With shares of this Spanish bank off almost 50% from a year ago, Santander's dividend yield now stands above 13%.

I'm not going to pretend that all is well in Europe, and that there aren't still painful days on the horizon. However, I think that if you're willing to invest for the long run, today's prices represent an excellent entrance point for the company. If European leaders have the political will to quell their debt and austerity issues, Santander could be a big winner. I'll be making a bullish CAPScall on my All-Star profile for the bank.

Gafisa (NYS: GFA)
We all know it's a bad time to be a homebuilder in America, but what about Brazil? That's where Gafsia -- which develops residential neighborhoods -- does its business. Currently offering a 5.3% dividend, the company is more than 60% off its 52-week high.

Worries about interest rates in Brazil, as well as concern that economic expectations may be a touch too high in the country, have contributed to the downfall. Although the company doesn't have a stellar record of meeting analyst expectations, I'm willing to get behind this one. With a forward P/E of 7.6, a PEG ratio of just 0.3, and the number of delivered housing units in the first quarter of 2012 double what it was in 2011, I think this company deserves more respect from Wall Street, and I'm not alone.

OPNET Technologies (NAS: OPNT)
Finally, we have OPNET, a provider of management software. The company is currently yielding a 2.8% dividend yield and is roughly 40% below its 52-week high. When the company announced preliminary earnings that were short of estimates, it was roundly punished by traders.

I'll be keeping my hands off this stock for now. Management software isn't my area of expertise, and the company has had a string of disappointing announcements. That, combined with the fact that the company paid out more in dividends than it brought in through free cash flow last year, just doesn't make me comfortable.

Some great dividend ideas
Clearly there's a lot to think about before diving in and buying dividend stocks that have taken a tumble lately. If investing in dividends is what keeps your portfolio humming, I suggest taking a look at our latest special free report on nine rock-solid dividends. Our analysts have handpicked their favorite dividend stocks to help bring your retirement portfolio to prosperity. Get your copy today, absolutely free.

At the time this article was published Fool contributor Brian Stoffel owns shares of Google and Apple. You can follow him on Twitter, where he goes by TMFStoffel.The Motley Fool owns shares of Google and Apple. Motley Fool newsletter services have recommended buying shares of Apple, Nokia, and Google, and creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

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