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."

Alon USA Partners

Dividend Yield: 17.90%

Alon USA Partners

(NYSE:

ALDW

) shares currently have a dividend yield of 17.90%.

Alon USA Partners, LP refines and markets petroleum products primarily in the South Central and Southwestern regions of the United States. The company owns and operates a crude oil refinery in Big Spring, Texas with crude oil throughput capacity of 73,000 barrels per day. The company has a P/E ratio of 7.15.

The average volume for Alon USA Partners has been 184,300 shares per day over the past 30 days. Alon USA Partners has a market cap of $1.4 billion and is part of the energy industry. Shares are up 77.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Alon USA Partners

as a

buy

. The company's strengths can be seen in multiple areas, such as its solid stock price performance and notable return on equity. 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:

  • Compared to its closing price of one year ago, ALDW's share price has jumped by 65.68%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ALDW should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, ALON USA PARTNERS LP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • ALON USA PARTNERS LP's earnings per share declined by 30.1% 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, ALON USA PARTNERS LP increased its bottom line by earning $2.70 versus $2.19 in the prior year. This year, the market expects an improvement in earnings ($2.76 versus $2.70).
  • 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 34.2%. Weakness in the company's revenue seems to have hurt the 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 significantly decreased by 30.1% when compared to the same quarter one year ago, falling from $76.99 million to $53.78 million.

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Holly Energy Partners

Dividend Yield: 7.40%

Holly Energy Partners

(NYSE:

HEP

) shares currently have a dividend yield of 7.40%.

Holly Energy Partners, L.P. owns and operates petroleum product and crude pipelines, storage tanks, distribution terminals, and loading rack facilities. The company has a P/E ratio of 20.71.

The average volume for Holly Energy Partners has been 141,900 shares per day over the past 30 days. Holly Energy Partners has a market cap of $1.7 billion and is part of the energy industry. Shares are up 5% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Holly Energy Partners

as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, expanding profit margins, good cash flow from operations and growth in earnings per share. 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 revenue growth greatly exceeded the industry average of 36.8%. Since the same quarter one year prior, revenues slightly increased by 7.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • HOLLY ENERGY PARTNERS LP has improved earnings per share by 14.3% 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 year. We feel that this trend should continue. During the past fiscal year, HOLLY ENERGY PARTNERS LP increased its bottom line by earning $1.20 versus $0.88 in the prior year. This year, the market expects an improvement in earnings ($1.55 versus $1.20).
  • 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 16.2% when compared to the same quarter one year prior, going from $29.68 million to $34.49 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 Oil, Gas & Consumable Fuels industry and the overall market, HOLLY ENERGY PARTNERS LP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for HOLLY ENERGY PARTNERS LP is currently very high, coming in at 72.74%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 39.01% significantly outperformed against the industry average.

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Jacksonville Bancorp

Dividend Yield: 12.70%

Jacksonville Bancorp

(NASDAQ:

JXSB

) shares currently have a dividend yield of 12.70%.

Jacksonville Bancorp, Inc. operates as the holding company for Jacksonville Savings Bank that provides various banking products and services in Illinois. The company has a P/E ratio of 15.23.

The average volume for Jacksonville Bancorp has been 300 shares per day over the past 30 days. Jacksonville Bancorp has a market cap of $45.3 million and is part of the banking industry. Shares are up 10% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Jacksonville Bancorp

as a

buy

. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and solid stock price performance. We feel its strengths outweigh the fact that the company has had somewhat weak growth in earnings per share.

Highlights from the ratings report include:

  • The gross profit margin for JACKSONVILLE BANCORP INC/MD is currently very high, coming in at 91.83%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, JXSB's net profit margin of 18.29% significantly trails the industry average.
  • 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.
  • Despite the weak revenue results, JXSB has outperformed against the industry average of 14.6%. Since the same quarter one year prior, revenues slightly dropped by 3.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Thrifts & Mortgage Finance industry and the overall market, JACKSONVILLE BANCORP INC/MD's return on equity is below that of both the industry average and the S&P 500.

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