Buy These Top 3 Buy-Rated Dividend Stocks Today: WMB, ENLK, PBA
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
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: 5.00%
(NYSE:
) shares currently have a dividend yield of 5.00%.
The Williams Companies, Inc. operates as an energy infrastructure company primarily in the United States. The company operates in three segments: Williams Partners, Access Midstream, and Williams NGL & Petchem Services. The company has a P/E ratio of 57.68.
The average volume for Williams Companies has been 8,251,300 shares per day over the past 30 days. Williams Companies has a market cap of $34.5 billion and is part of the energy industry. Shares are up 4% year-to-date as of the close of trading on Monday.
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TheStreet Ratings rates
Williams Companies
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, expanding profit margins, good cash flow from operations and compelling growth in net income. 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:
- The revenue growth greatly exceeded the industry average of 19.6%. Since the same quarter one year prior, revenues rose by 29.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- 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 Oil, Gas & Consumable Fuels industry. The net income increased by 1478.6% when compared to the same quarter one year prior, rising from -$14.00 million to $193.00 million.
- 44.42% is the gross profit margin for WILLIAMS COS INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 9.01% is above that of the industry average.
- Net operating cash flow has significantly increased by 96.31% to $1,011.00 million when compared to the same quarter last year. In addition, WILLIAMS COS INC has also vastly surpassed the industry average cash flow growth rate of -11.94%.
- You can view the full Williams Companies Ratings Report.
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Dividend Yield: 5.60%
(NYSE:
) shares currently have a dividend yield of 5.60%.
Enlink Midstream Partners, LP, through its subsidiary, EnLink Midstream Operating, LP, provides midstream energy services. The company has a P/E ratio of 45.02.
The average volume for EnLink Midstream Partners has been 508,600 shares per day over the past 30 days. EnLink Midstream Partners has a market cap of $6.5 billion and is part of the energy industry. Shares are down 7.9% year-to-date as of the close of trading on Monday.
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TheStreet Ratings rates
EnLink Midstream Partners
as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and compelling growth in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- ENLK's very impressive revenue growth greatly exceeded the industry average of 19.6%. Since the same quarter one year prior, revenues leaped by 65.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.42, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.09, which illustrates the ability to avoid short-term cash problems.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 124.3% when compared to the same quarter one year prior, rising from $23.00 million to $51.60 million.
- Net operating cash flow has significantly increased by 1316.30% to $92.40 million when compared to the same quarter last year. In addition, ENLINK MIDSTREAM PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -11.94%.
- ENLINK MIDSTREAM PARTNERS LP has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, ENLINK MIDSTREAM PARTNERS LP increased its bottom line by earning $0.60 versus $0.00 in the prior year. For the next year, the market is expecting a contraction of 0.8% in earnings ($0.60 versus $0.60).
- You can view the full EnLink Midstream Partners Ratings Report.
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Dividend Yield: 4.40%
(NYSE:
) shares currently have a dividend yield of 4.40%.
Pembina Pipeline Corporation provides transportation and midstream services for the energy industry in North America. It operates through four businesses: Conventional Pipelines, Oil Sands & Heavy Oil, Gas Services, and Midstream. The company has a P/E ratio of 34.37.
The average volume for Pembina Pipeline has been 341,400 shares per day over the past 30 days. Pembina Pipeline has a market cap of $10.6 billion and is part of the energy industry. Shares are down 14.2% year-to-date as of the close of trading on Monday.
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TheStreet Ratings rates
Pembina Pipeline
as a
. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- The current debt-to-equity ratio, 0.45, is low and is below the industry average, implying that there has been successful management of debt levels. Despite the fact that PBA's debt-to-equity ratio is low, the quick ratio, which is currently 0.68, displays a potential problem in covering short-term cash needs.
- Net operating cash flow has remained constant at $196.00 million with no significant change when compared to the same quarter last year. Along with maintaining stable cash flow from operations, the firm exceeded the industry average cash flow growth rate of -11.94%.
- Despite the weak revenue results, PBA has outperformed against the industry average of 19.6%. Since the same quarter one year prior, revenues slightly dropped by 3.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
- The change in net income from the same quarter one year ago has significantly exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income has decreased by 11.5% when compared to the same quarter one year ago, dropping from $94.90 million to $84.00 million.
- The gross profit margin for PEMBINA PIPELINE CORP is currently extremely low, coming in at 14.85%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 6.67% is above that of the industry average.
- You can view the full Pembina Pipeline Ratings Report.
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Other helpful dividend tools from TheStreet:
- Our dividend calendar.
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