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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."

Western Refining

Dividend Yield: 4.70%

Western Refining

(NYSE:

WNR

) shares currently have a dividend yield of 4.70%.

Western Refining, Inc. operates as an independent crude oil refiner and marketer of refined products. The company operates in four segments: Refining, NTI, WNRL, and Retail. The company has a P/E ratio of 5.69.

The average volume for Western Refining has been 1,841,700 shares per day over the past 30 days. Western Refining has a market cap of $3.1 billion and is part of the energy industry. Shares are down 14.2% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Western Refining

TheStreet Recommends

as a

buy

. The company's strengths can be seen in multiple areas, such as its notable return on equity, attractive valuation levels, good cash flow from operations and solid stock price performance. We feel its 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:

  • 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 Oil, Gas & Consumable Fuels industry and the overall market, WESTERN REFINING INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 73.23% to $373.62 million when compared to the same quarter last year. In addition, WESTERN REFINING INC has also vastly surpassed the industry average cash flow growth rate of -26.82%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 36.8%. Since the same quarter one year prior, revenues fell by 36.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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Ryman Hospitality Properties

Dividend Yield: 6.40%

Ryman Hospitality Properties

(NYSE:

RHP

) shares currently have a dividend yield of 6.40%.

Ryman Hospitality Properties, Inc. owns and operates hotels in the United States. The company has a P/E ratio of 16.77.

The average volume for Ryman Hospitality Properties has been 245,200 shares per day over the past 30 days. Ryman Hospitality Properties has a market cap of $2.2 billion and is part of the real estate industry. Shares are down 14.2% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Ryman Hospitality Properties

as a

buy

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, notable return on equity, good cash flow from operations and impressive record of earnings per share growth. We feel its strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:

  • 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 76.4% when compared to the same quarter one year prior, rising from $15.13 million to $26.69 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 6.1%. Since the same quarter one year prior, revenues slightly increased by 2.2%. 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, RYMAN HOSPITALITY PPTYS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to $75.36 million or 15.04% when compared to the same quarter last year. In addition, RYMAN HOSPITALITY PPTYS INC has also modestly surpassed the industry average cash flow growth rate of 9.39%.
  • RYMAN HOSPITALITY PPTYS INC reported significant earnings per share improvement 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, RYMAN HOSPITALITY PPTYS INC increased its bottom line by earning $2.16 versus $1.77 in the prior year. For the next year, the market is expecting a contraction of 4.6% in earnings ($2.06 versus $2.16).

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Verizon Communications

Dividend Yield: 5.00%

Verizon Communications

(NYSE:

VZ

) shares currently have a dividend yield of 5.00%.

Verizon Communications Inc., through its subsidiaries, provides communications, information, and entertainment products and services to consumers, businesses, and governmental agencies worldwide. The company has a P/E ratio of 18.20.

The average volume for Verizon Communications has been 13,290,100 shares per day over the past 30 days. Verizon Communications has a market cap of $182.6 billion and is part of the telecommunications industry. Shares are down 0.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Verizon Communications

as a

buy

. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, growth in earnings per share, good cash flow from operations and expanding profit margins. We feel its 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 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 Diversified Telecommunication Services industry average. The net income increased by 9.3% when compared to the same quarter one year prior, going from $3,695.00 million to $4,038.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.4%. Since the same quarter one year prior, revenues slightly increased by 5.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • VERIZON COMMUNICATIONS INC has improved earnings per share by 11.2% 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, VERIZON COMMUNICATIONS INC reported lower earnings of $2.51 versus $4.00 in the prior year. This year, the market expects an improvement in earnings ($3.97 versus $2.51).
  • Net operating cash flow has increased to $9,520.00 million or 13.97% when compared to the same quarter last year. Despite an increase in cash flow, VERIZON COMMUNICATIONS INC's average is still marginally south of the industry average growth rate of 16.26%.
  • The gross profit margin for VERIZON COMMUNICATIONS INC is rather high; currently it is at 59.87%. Regardless of VZ's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, VZ's net profit margin of 12.17% compares favorably to the industry average.

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