(MONEY Magazine) – One easy and conservative way to build capital over the long term is to own high-yielding stocks of financially stable companies and reinvest the dividends. To get more for your money, Duane E. Frederic, the publisher of a directory of dividend-reinvestment plans (8908 E. Pilgrim Dr., Chagrin Falls, Ohio 44022; $15), suggests buying companies that give 5% discounts on reinvested dividends (see the box below). That way you will get shares worth $105 for every $100 you reinvest. At MONEY'S request, Frederic screened his data base of 950 stocks offering dividend-reinvestment plans for issues traded on the New York Stock Exchange that pay at least 6% yields and offer the 5% discounts. We further pared his list to the 10 companies in the box, which have solid earnings records and secure dividends, according to industry analysts. The companies include: -- Four electric utilities: Empire District Electric, which serves Arkansas, Kansas, Missouri and Oklahoma; Green Mountain Power in Vermont; Hawaiian Electric, which supplies 95% of the electricity in the 50th state; and Texas Utilities -- Two New Jersey-based gas utilities: NUI Corp. in the state's industrial North and South Jersey Industries -- Three real estate investment trusts: Mortgage & Realty Trust, which mostly makes mortgage loans; New Plan Realty Trust, which operates 35 shopping centers in the East; and Santa Anita Realty Enterprises, which owns the famed racetrack in California The final company on the list is New York City's Chase Manhattan Bank, second largest in the U.S.

CHART: Discount stocks These 10 companies, all listed on the New York Stock Exchange and yielding at least 6%, let shareholders use their dividends to buy more stock at 5% discounts.

Recent P/E Dividend price ratio yield STOCK Chase Manhattan $29 N.M. 7.5% Empire District Elec. 29 10 7.3 Green Mt. Power 24 9 7.8 Hawaiian Electric 28 12 6.7 Mortgage & Realty 18 10 10.8 New Plan Realty 14 19 6.3 NUI 18 7 8.4 Santa Anita Realty 31 19 6.5 S. Jersey Industries 18 9 7.2 Texas Utilities 28 6 10.1 CREDIT: Source: Duane E. Frederic CAPTION: NO CAPTION DESCRIPTION: Financial information on 10 discount stocks.

N.M. (not meaningful)