Stocks with "large combined buyback and dividend yields will remain popular" next year, despite the "live possibility" of a December interest rate hike, according to Goldman Sachs.

Goldman expects aggregate spending by S&P 500 companies to rise by 5% to $2.24 trillion in 2016, with "investments (54% of spending) growing by 3% and return to shareholders (46%) rising by 7%," according to a note to clients on Friday.

"Stocks with high total cash returns will outperform in 2016 despite the bear flattening yield curve environment," Goldman Sach's David Kostin wrote. "Although the Fed will be tightening, interest rates will remain low on a historical basis. The muted pace of economic expansion in the U.S., the uncertain prospects for global growth, and a low expected S&P 500 return, will leave investors searching for yield."

Goldman's total cash return basket contains 50 sector-neutral S&P 500 stocks with the largest trailing four-quarter combined buyback and dividend yields. Since 1995, the basket has "outperformed the S&P 500 by an annual average of 6 percentage points (16% vs. 10%), beating the index in 70% of quarters," the note said.

Here are the seven stocks with the highest combined yield of buybacks and dividends among the list, but are the stocks all buy rated? Ratings from TheStreet Ratings were added for another perspective.

TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

Note: Stock ratings are as of Nov. 8, 2015.

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NOC

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7. Northrop Grumman Corp. (NOC) - Get Report
Industry: Industrials/Aerospace & Defense
Total Yield (12-month trailing): 15.5%
Buyback Yield: 13.2%
Dividend Yield: 2.4%

Year-to-date return: 23.2%

Goldman Rating/Target Price: Buy/$222

TheStreet Said: TheStreet Ratings team rates NORTHROP GRUMMAN CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate NORTHROP GRUMMAN CORP (NOC) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, reasonable valuation levels and notable return on equity. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 35.24% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, NOC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • NORTHROP GRUMMAN CORP has improved earnings per share by 21.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NORTHROP GRUMMAN CORP increased its bottom line by earning $9.74 versus $8.34 in the prior year. This year, the market expects an improvement in earnings ($9.83 versus $9.74).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Aerospace & Defense industry average. The net income increased by 9.1% when compared to the same quarter one year prior, going from $473.00 million to $516.00 million.
  • 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. In comparison to other companies in the Aerospace & Defense industry and the overall market on the basis of return on equity, NORTHROP GRUMMAN CORP has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
  • You can view the full analysis from the report here: NOC
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NAVI

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6. Navient Corp. (NAVI) - Get Report
Industry: Financial Services/Consumer Finance
Total Yield (12-month trailing): 16.7%
Buyback Yield: 13.4%
Dividend Yield: 3.3%

Year-to-date return: -40%

Goldman Rating/Target Price: Buy/$15

TheStreet Said: TheStreet Ratings team rates NAVIENT CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

We rate NAVIENT CORP (NAVI) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and generally higher debt management risk.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for NAVIENT CORP is currently very high, coming in at 71.49%. Regardless of NAVI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NAVI's net profit margin of 19.14% compares favorably to the industry average.
  • NAVI, with its decline in revenue, slightly underperformed the industry average of 4.8%. Since the same quarter one year prior, revenues slightly dropped by 5.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The debt-to-equity ratio is very high at 33.76 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • Net operating cash flow has decreased to $404.00 million or 19.52% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • You can view the full analysis from the report here: NAVI
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CBS

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5. CBS Corp. (CBS) - Get Report
Industry: Consumer Goods & Services/Broadcasting
Total Yield (12-month trailing): 17%
Buyback Yield: 16.1%
Dividend Yield: 0.9%

Year-to-date return: -12.3%

Goldman Rating/Target Price: Neutral/$43

TheStreet Said: TheStreet Ratings team rates CBS CORP as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate CBS CORP (CBS) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its notable return on equity, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and a generally disappointing performance in the stock itself.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Media industry and the overall market, CBS CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • CBS CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CBS CORP reported lower earnings of $2.39 versus $2.79 in the prior year. This year, the market expects an improvement in earnings ($3.33 versus $2.39).
  • CBS has underperformed the S&P 500 Index, declining 9.01% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Media industry. The net income has significantly decreased by 74.0% when compared to the same quarter one year ago, falling from $1,639.00 million to $426.00 million.
  • You can view the full analysis from the report here: CBS
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BBBY

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4. Bed, Bath & Beyond Inc. (BBBY) - Get Report
Industry: Consumer Goods & Services/Homefurnishing Retail
Total Yield (12-month trailing): 18.7%
Buyback Yield: 18.7%
Dividend Yield: 0.0%

Year-to-date return: -21.1%

Goldman Rating/Target Price: Sell/$66

TheStreet Said: TheStreet Ratings team rates BED BATH & BEYOND INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate BED BATH & BEYOND INC (BBBY) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.1%. Since the same quarter one year prior, revenues slightly increased by 1.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 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. When compared to other companies in the Specialty Retail industry and the overall market, BED BATH & BEYOND INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • The current debt-to-equity ratio, 0.58, is low and is below the industry average, implying that there has been successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.35 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • Net operating cash flow has decreased to $255.31 million or 30.54% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed compared to the Specialty Retail industry average, but is greater than that of the S&P 500. The net income has decreased by 9.9% when compared to the same quarter one year ago, dropping from $223.95 million to $201.68 million.
  • You can view the full analysis from the report here: BBBY
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MSI

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3. Motorola Solutions (MSI) - Get Report
Industry: Technology/Communications Equipment
Total Yield (12-month trailing): 19.9%
Buyback Yield: 18%
Dividend Yield: 1.8%

Year-to-date return: 1.7%

Goldman Rating/Target Price: Sell/$62

TheStreet Said: TheStreet Ratings team rates MOTOROLA SOLUTIONS INC as a Hold with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation:

We rate MOTOROLA SOLUTIONS INC (MSI) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, solid stock price performance and growth in earnings per share. However, as a counter to these strengths, we find that net income has been generally deteriorating over time.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly increased by 309.79% to $300.00 million when compared to the same quarter last year. In addition, MOTOROLA SOLUTIONS INC has also vastly surpassed the industry average cash flow growth rate of 9.34%.
  • After a year of stock price fluctuations, the net result is that MSI's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • The gross profit margin for MOTOROLA SOLUTIONS INC is rather high; currently it is at 50.35%. Regardless of MSI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 8.01% trails the industry average.
  • The change in net income from the same quarter one year ago has exceeded that of the Communications Equipment industry average, but is less than that of the S&P 500. The net income has decreased by 22.4% when compared to the same quarter one year ago, dropping from $147.00 million to $114.00 million.
  • You can view the full analysis from the report here: MSI
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JNPR

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2. Juniper Networks Inc. (JNPR) - Get Report
Industry: Technology/Communications Equipment
Total Yield (12-month trailing): 21.7%
Buyback Yield: 20.3%
Dividend Yield: 1.4%

Year-to-date return: 31%

Goldman Rating/Target Price: Buy/$35

TheStreet Said: TheStreet Ratings team rates JUNIPER NETWORKS INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

We rate JUNIPER NETWORKS INC (JNPR) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, increase in net income, good cash flow from operations and growth in earnings per share. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 9.6%. Since the same quarter one year prior, revenues rose by 10.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 121.73% and other important driving factors, this stock has surged by 46.52% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, JNPR should continue to move higher despite the fact that it has already enjoyed a very nice gain in 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 Communications Equipment industry. The net income increased by 90.8% when compared to the same quarter one year prior, rising from $103.60 million to $197.70 million.
  • Net operating cash flow has significantly increased by 473.24% to $293.00 million when compared to the same quarter last year. In addition, JUNIPER NETWORKS INC has also vastly surpassed the industry average cash flow growth rate of 9.34%.
  • JUNIPER NETWORKS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, JUNIPER NETWORKS INC swung to a loss, reporting -$0.90 versus $0.86 in the prior year. This year, the market expects an improvement in earnings ($2.00 versus -$0.90).
  • You can view the full analysis from the report here: JNPR
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KLAC

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1. KLA-Tencor Corp. (KLAC) - Get Report
Industry: Technology/Semiconductor Equipment
Total Yield (12-month trailing): 30.4%
Buyback Yield: 5.1%
Dividend Yield: 25.3%

Year-to-date return: -4.8%

Goldman Rating/Target Price: N/A

TheStreet Said: TheStreet Ratings team rates KLA-TENCOR CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

We rate KLA-TENCOR CORP (KLAC) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its increase in net income, notable return on equity and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and generally higher debt management risk.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 45.2% when compared to the same quarter one year prior, rising from $72.23 million to $104.90 million.
  • 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 Semiconductors & Semiconductor Equipment industry and the overall market, KLA-TENCOR CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • KLA-TENCOR CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, KLA-TENCOR CORP reported lower earnings of $2.25 versus $3.47 in the prior year. This year, the market expects an improvement in earnings ($3.57 versus $2.25).
  • The debt-to-equity ratio is very high at 10.70 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 3.00, which shows the ability to cover short-term cash needs.
  • KLAC has underperformed the S&P 500 Index, declining 17.57% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • You can view the full analysis from the report here: KLAC