Buy-Rated Dividend Stocks In The Top 3: LAMR, BCE, SFUN
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
TheStreet Ratings' stock model projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Our Buy, Hold or Sell ratings designate how we expect these stocks to perform against a general benchmark of the equities market and interest rates.
While plenty of high-yield opportunities exist, investors must always consider the safety of their dividend and the total return potential of their investment. It is not uncommon for a struggling company to suspend high-yielding dividends which could subsequently result in precipitous share price declines.
TheStreet Ratings' stock rating model views dividends favorably, but not so much that other factors are disregarded. Our model gauges the relationship between risk and reward in several ways, including: the pricing drawdown as compared to potential profit volatility, i.e. how much one is willing to risk in order to earn profits?; the level of acceptable volatility for highly performing stocks; the current valuation as compared to projected earnings growth; and the financial strength of the underlying company as compared to its stock's valuation as compared to its stock's performance.
These and many more derived observations are then combined, ranked, weighted, and scenario-tested to create a more complete analysis. The result is a systematic and disciplined method of selecting stocks. As always, stock ratings should not be treated as gospel — rather, use them as a starting point for your own research.
The following pages contain our analysis of 3 stocks with substantial yields, that ultimately, we have rated "Buy."
Dividend Yield: 4.70%
(NASDAQ:
) shares currently have a dividend yield of 4.70%.
Lamar Advertising Company is a publicly owned equity real estate investment trust. The firm primarily engages in selling advertising space on billboards, buses, shelters, benches, and logo plates. Lamar Advertising Company was founded in 1902 and is headquartered in Baton Rouge, Louisiana. The company has a P/E ratio of 21.84.
The average volume for Lamar Advertising has been 897,400 shares per day over the past 30 days. Lamar Advertising has a market cap of $4.7 billion and is part of the real estate industry. Shares are up 8.7% year-to-date as of the close of trading on Monday.
TheStreet Ratings rates
Lamar Advertising
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, solid stock price performance, compelling growth in net income and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
Highlights from the ratings report include:
- LAMR's revenue growth has slightly outpaced the industry average of 3.1%. Since the same quarter one year prior, revenues slightly increased by 5.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, LAMAR ADVERTISING CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 1940.9% when compared to the same quarter one year prior, rising from $10.19 million to $207.88 million.
- Net operating cash flow has increased to $149.33 million or 49.29% when compared to the same quarter last year. In addition, LAMAR ADVERTISING CO has also vastly surpassed the industry average cash flow growth rate of -43.90%.
- You can view the full Lamar Advertising Ratings Report.
Dividend Yield: 4.70%
(NYSE:
) shares currently have a dividend yield of 4.70%.
BCE Inc., a communications company, provides broadband communication services to residential and business customers in Canada. The company operates through four segments: Bell Wireline, Bell Wireless, Bell Media, and Bell Aliant. The company has a P/E ratio of 16.53.
The average volume for BCE has been 1,167,200 shares per day over the past 30 days. BCE has a market cap of $36.3 billion and is part of the telecommunications industry. Shares are down 4.8% year-to-date as of the close of trading on Monday.
TheStreet Ratings rates
BCE
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income, notable return on equity and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the ratings report include:
- BCE's revenue growth has slightly outpaced the industry average of 2.6%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
- The net income growth from the same quarter one year ago has significantly exceeded that of the Diversified Telecommunication Services industry average, but is less than that of the S&P 500. The net income increased by 10.2% when compared to the same quarter one year prior, going from $528.00 million to $582.00 million.
- The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Diversified Telecommunication Services industry and the overall market on the basis of return on equity, BCE INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- BCE INC reported flat earnings per share in the most recent quarter. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, BCE INC increased its bottom line by earning $2.97 versus $2.54 in the prior year.
- In its most recent trading session, BCE has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- You can view the full BCE Ratings Report.
Dividend Yield: 5.80%
(NYSE:
) shares currently have a dividend yield of 5.80%.
SouFun Holdings Limited operates a real estate Internet portal, and a home furnishing and an improvement Website in the People's Republic of China. The company has a P/E ratio of 2.13.
The average volume for SouFun Holdings has been 6,577,800 shares per day over the past 30 days. SouFun Holdings has a market cap of $2.8 billion and is part of the internet industry. Shares are down 12.7% year-to-date as of the close of trading on Monday.
TheStreet Ratings rates
SouFun Holdings
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.
Highlights from the ratings report include:
- SFUN's revenue growth trails the industry average of 18.6%. Since the same quarter one year prior, revenues slightly increased by 2.7%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The gross profit margin for SOUFUN HLDGS LTD is currently very high, coming in at 82.22%. Regardless of SFUN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SFUN's net profit margin of 37.00% significantly outperformed against the industry.
- SFUN's debt-to-equity ratio of 0.92 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that SFUN's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.20 is high and demonstrates strong liquidity.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Internet Software & Services industry and the overall market, SOUFUN HLDGS LTD's return on equity significantly exceeds that of both the industry average and the S&P 500.
- You can view the full SouFun Holdings Ratings Report.
Other helpful dividend tools from TheStreet:
- Our dividend calendar.
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