My daughter, at 11, eats only one flavor of ice cream. She knows chocolate is the best flavor in the world at all times and under all circumstances, so why try anything else?

Me? I'll go with chocolate fudge brownie one day, mocha chip another. Sometimes mint chip. If I'm at Grom, the closest you can come to Italian gelato in my neighborhood, it's bacio or stracciatella. And I'm always ready to try a special French vanilla.

I've got a similarly eclectic taste when it comes to choosing a good stock: Different flavors appeal to me in different markets. In my Aug. 6 column, "Picking stocks for a 'bad' market," I laid out the reasons behind a "buy good stocks in a bad market" strategy and started to sketch in some of the different flavors of good stocks.

I wound up with five: dividend-paying good stocks; good stocks for trading either in swing trades or sector and seasonal trades; stocks so good they go up even when the market goes down; hammered favorites likely to rebound; and, finally, traditionally defined good stocks. I said I thought it was still too early for Flavor No. 5, traditionally defined good stocks, and I'd written enough recently about candidates for swing trades (Flavor No. 2). But I promised to flesh out the three other flavors with some specific stock picks in my next column.

Here's that column. (By the way, this is starting to make me hungry. If this column ends in the middle, it's because I needed an ice-cream break.)

Image: Jim Jubak

Jim Jubak

Good stocks that pay dividends

Why look for dividends in your good stocks? First, if a fundamentally sound stock pays a decent dividend, that yield (or payout) will support the stock price in a market downturn. Second, if the price of U.S. Treasurys continues to rise and the yields continue to fall, investors can expect the yields and prices on other income vehicles to follow the same trends. In my most recent column, I mentioned two stocks, both in my Jubak's Picks portfolio, that fit this bill: Abbott Laboratories (ABT) and Bristol-Myers Squibb (BMY), which pay dividends of 3.1% and 4.2%, respectively.

Let me suggest three more today. I'm sticking with U.S. stocks, because if the market swings back to a risk-off trade environment -- with traders selling anything that smacks of risk -- I would rather be in U.S. equities than in emerging or overseas markets. My picks would be:

  • General Electric (GE). Protection comes from a 3.2% dividend, and the upside is a result of the resumption of dividends from GE Capital to the parent. In the second quarter, GE Capital paid $3 billion in dividends to General Electric. That helped finance a $900 billion buyback of General Electric stock, and the company has said that it plans to purchase an additional $3.5 billion to $4 billion in shares by the end of this year. Wall Street projects earnings growth of 20% in 2012. (General Electric is a member of my dividend income portfolio.)
  • DuPont (DD). Protection comes from a 3.4% dividend, and the upside is a result of the company's continued transformation from a commodity chemical company with relatively low margins to a growth company built around agriculture (24% of sales); nutrition and health (6.4% of sales in 2011 but more in 2012 with the full integration of Danisco, acquired in 2011); performance chemicals (20.3% of sales); performance materials (17.8% of sales); and safety and protection (10.2% of sales). The company is shopping its performance-coatings business -- one of the world's largest producers of automotive paint and coatings -- and is rumored to have three potential buyers. The unit shows EBITDA (earnings before interest, taxes, depreciation and amortization) margins of just 6.5%, compared with 15.3% for nutrition, and 19.2% for safety and protection.
  • McDonald's (MCD). Protection comes from a 3.2% dividend, and the upside comes as the stock climbs back from a hit this week. The drop was an overreaction to disappointing July same-store sales. Global same-store sales were about the same as in July 2011, with the U.S. down 0.1%, Europe down 0.6% and the Asia-Pacific region down 1.5%. Sales growth in Latin America and Canada brought the company back to even. (McDonald's is a member of my Jubak's Picks portfolio ).

'Won't go down with the market' stocks

A few stocks in this market fit the traditional "buy good stocks in a bad market" formula because they seem able to go up even when the market doesn't -- or are at least able to hold their ground when the market stumbles. In my earlier column, I mentioned Apple (AAPL) and Precision Castparts (PCP), both members of my Jubak's Picks portfolio.

Let me suggest four more today:

  • Middleby (MIDD). This is one frustrating stock -- frustrating because it never gives me a chance to buy it on much of a dip. I've been able to pick up shares at $96 and $98 during the big May decline to the early June low, but Middleby's shares have stayed between $95 and $105 during all the recent volatility. They jumped by more than $13 on Aug. 9, to close at $113.77, a new 52-week high. And you can see why: The company reported second-quarter earnings after the close on Aug. 8 of $1.67 a share, beating the Wall Street consensus by 23 cents a share. Revenue climbed by 23.3% year over year to $260 million, against the $252 million consensus. Middleby just keeps building market share through organic growth and acquisitions in the still-fragmented market for restaurant kitchen equipment. The company's secret revenue weapon: The Great Recession has left a lot of restaurants with aging equipment, because they cut capital spending when growth slowed, so there's a lot of catching up to do.
  • Asmel (ASML). It may seem odd to have a Dutch technology company on this list -- not only are technology stocks supposed to be volatile, but there's that euro thing, too. But Asmel is a rather unusual technology company. Asmel recently received equity investments from its biggest customers, Intel (INTC) and Taiwan Semiconductor Manufacturing (TSM), because chip-makers need to push the frontier for packing more computing power into ever-smaller chips. Asmel's extreme ultraviolet lithography machinery is, these customers believe, the best way to get there. There's nothing like a 20% equity investment -- via what's called a synthetic buyback, in which existing shareholders lose none of their shares' value -- to demonstrate your faith in the future of your products.

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  • EMC (EMC). EMC was doing fine increasing its earnings even in a slow global economy -- year-over-year earnings growth for the past five quarters was 29%, 26%, 37%, 22% and 15%. But this is a company that's determined to find new growth. The company has announced a partnership with Lenovo Group (LNVGY), the Chinese company that is the world's second-largest maker of PCs. Lenovo will resell EMC's networked storage solutions, starting with Lenovo's customers in China. The deal will help Lenovo grow its server business -- more trouble for Dell (DELL) and Hewlett-Packard (HPQ) -- and it will give EMC a good chance of expanding its sales in Asia. The Asia-Pacific region accounted for just 13% of EMC sales in 2011, and the company has only a 22% market share in the region versus 30% globally. And don't forget that EMC owns 80% of VMware (VMW).
  • IBM (IBM). The old saw "Nobody ever lost their job recommending the purchase of IBM equipment" resonates in the current economic climate. Companies need to be sure that new equipment and software will run with legacy gear and that services can be outsourced from a company that understands existing systems and software. IBM has reinvented itself, going from a predominantly hardware company (hardware represented just 18% of sales in 2011) to a hardware/software company (software represented 25% of revenue in 2011) to a services-driven company (services are now more than 50% of sales). The combination gives the company a significant advantage over hardware-based competitors (such as Hewlett-Packard) and over service providers such as Accenture (ACN).