"Public companies share the wealth with investors mainly through dividends and stock buybacks, and both actions have historically benefited investor returns," explains Richard Moroney in Dow Theory Forecasts, a blue-chip-focused service that has been published for over 50 years.

To benefit from both types of yields, the advisor has combined both dividends and buybacks to create what he calls a "shareholder yield." He explains, "Since both types of yield signify added value to shareholders, investors should be able to improve their odds in the market by harnessing the power of both statistics."

Moroney suggests, "In this case, dividend yield equals cash dividends over the prior 12 months as a percentage of a company's current market value, while the buyback yield equals cash spent on buybacks as a percentage of market value." The shareholder's yield is then the dividend yield and the buyback yield added together.

Moroney then screened for blue chip stocks with high shareholder yields, highlighting four that stood out in his search: Citigroup (NYSE: C), Exxon-Mobil (NYSE: XOM), McDonald's (NYSE: MCD) and Microsoft (NASDAQ: MSFT).

As to Citigroup, he notes that the financial services firm drives top line growth by expanding in both the U.S. and overseas. The company, he notes, with over 200 million customer accounts and a presence in over 100 countries, generates 45% of revenue in foreign countries.

He adds, "Acquisitions have helped drive sales growth in recent years, and Citigroup is likely to continue devoting its massive resources to purchasing companies. A combination of cost cuts and stock buybacks should support the bottom line."

The company repurchased $7 billion in stock last year and $645 million in the March quarter, according to the advisor. At 11 times projected 2007 earnings, he believes the stock looks "relatively cheap." With a trailing shareholder yield of 6.5%, he considers the stock a long-term buy.

As for Exxon Mobil, he notes that the company has averaged a reserve-replacement rate of 114% over the last five years. Per-share earnings, he adds, have risen in each of the last five years, increasing 15% in 2006 to a record $39.5 billion, or $6.62 per share. Exxon also generated $52.4 billion of cash flow from operations and asset sales last year, he points out.

Moroney states, "The company spent $19.9 billion on exploration and related activities, but much of the rest of the cash was shared with stockholders. Per-share dividends rose 12% in 2006, Exxon's 24th consecutive annual dividend hike. Exxon also repurchased $29.5 billion of shares in 2006, up from $18.2 billion in 2005."

With a trailing shareholder yield of 8.4%, the advisor also rates Exxon-Mobil as a long-term buy.

McDonald's, meanwhile, has raised its dividends for 30 consecutive years and more than quadrupled the payout in the last five years according to Moroney. He notes that the cash available for dividends and share repurchases will likely continue to increase, boosted by the ongoing strength of McDonald's core business.

Between 2006 and 2008, he says, the company expects to return more than $10 billion to shareholders through dividends and share repurchases. In addition, he suggests, "Through the franchising of nearly 1,600 restaurants in Latin America and the Caribbean, McDonald's expects to produce a reliable stream of royalty income without major capital expenditures."

The advisor explains, "The $700 million in cash McDonald's will receive from the deal is slated for return to shareholders through dividends and buybacks. At 19 times projected 2007 earnings, McDonald's, is a long- term buy which seems reasonably valued relative to its growth potential."

Microsoft has its Windows system running on 95% of the world's personal computers, notes the advisor, and sales of the next-generation Vista product exceeded 40 million licenses in the first 100 days on the market.

He suggests, "During the nine months ended March 31, 2007, Microsoft generated double-digit revenue growth in four of its five business segments, produced $13.4 billion in net cash from operations, and returned $23.2 billion to shareholders through share buybacks and dividends."

A trailing dividend yield of 1.3% and a buyback yield of 8.4%, he notes, combines to represent a shareholder yield of 9.7%. He concludes, "At 18 times projected year-ahead earnings of $1.64, Microsoft trades well below its historical average valuation and the average for software developers. The stock is a long-term buy."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment ideas and market commentary from the financial newsletter community.