5 Buy-Rated Dividend Stocks

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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 and 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 5 stocks with substantial yields, that ultimately, we have rated "Buy."

Annaly Capital Management

Dividend Yield: 11.60%

Annaly Capital Management (NYSE: NLY) shares currently have a dividend yield of 11.60%.

Annaly Capital Management, Inc. owns, manages, and finances a portfolio of real estate related investments in United States. The company has a P/E ratio of 9.06. Currently there are 3 analysts that rate Annaly Capital Management a buy, 3 analysts rate it a sell, and 10 rate it a hold.

The average volume for Annaly Capital Management has been 10,096,900 shares per day over the past 30 days. Annaly Capital Management has a market cap of $14.7 billion and is part of the real estate industry. Shares are up 11.5% year to date as of the close of trading on Friday.

TheStreet Ratings rates Annaly Capital Management as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, attractive valuation levels, expanding profit margins, good cash flow from operations and notable return on equity. 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 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 57.2% when compared to the same quarter one year prior, rising from $445.56 million to $700.50 million.
  • The gross profit margin for ANNALY CAPITAL MANAGEMENT is currently very high, coming in at 95.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 76.74% significantly outperformed against the industry average.
  • Net operating cash flow has significantly increased by 121.67% to $352.76 million when compared to the same quarter last year. In addition, ANNALY CAPITAL MANAGEMENT has also vastly surpassed the industry average cash flow growth rate of 32.95%.
  • 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 Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, ANNALY CAPITAL MANAGEMENT has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.

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Valley National Bancorp

Dividend Yield: 6.30%

Valley National Bancorp (NYSE: VLY) shares currently have a dividend yield of 6.30%.

Valley National Bancorp operates as the bank holding company for the Valley National Bank that provides various commercial, retail, trust, and investment services. Its deposit products include savings accounts, NOW accounts, money market accounts, time deposits, and certificates of deposit. The company has a P/E ratio of 14.18. Currently there are no analysts that rate Valley National Bancorp a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Valley National Bancorp has been 1,159,600 shares per day over the past 30 days. Valley National Bancorp has a market cap of $2.1 billion and is part of the banking industry. Shares are up 12% year to date as of the close of trading on Friday.

TheStreet Ratings rates Valley National Bancorp as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and attractive valuation levels. 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 revenue growth came in higher than the industry average of 1.5%. Since the same quarter one year prior, revenues slightly increased by 9.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Banks industry. The net income increased by 48.4% when compared to the same quarter one year prior, rising from $24.82 million to $36.83 million.
  • The gross profit margin for VALLEY NATIONAL BANCORP is currently very high, coming in at 74.80%. It has increased significantly from the same period last year. Along with this, the net profit margin of 18.71% is above that of the industry average.
  • Net operating cash flow has significantly increased by 692.16% to $88.84 million when compared to the same quarter last year. In addition, VALLEY NATIONAL BANCORP has also vastly surpassed the industry average cash flow growth rate of 569.94%.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

Textainer Group Holdings

Dividend Yield: 4.30%

Textainer Group Holdings (NYSE: TGH) shares currently have a dividend yield of 4.30%.

Textainer Group Holdings Limited, through its subsidiaries, engages in the purchase, ownership, management, leasing, and resale of a fleet of marine cargo containers worldwide. The company has a P/E ratio of 10.77. Currently there are 4 analysts that rate Textainer Group Holdings a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for Textainer Group Holdings has been 330,900 shares per day over the past 30 days. Textainer Group Holdings has a market cap of $2.3 billion and is part of the diversified services industry. Shares are up 32% year to date as of the close of trading on Friday.

TheStreet Ratings rates Textainer Group Holdings as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, increase in net income and solid stock price performance. 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:
  • TGH's revenue growth has slightly outpaced the industry average of 7.2%. Since the same quarter one year prior, revenues slightly increased by 9.4%. 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 net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Trading Companies & Distributors industry average. The net income increased by 10.3% when compared to the same quarter one year prior, going from $54.92 million to $60.57 million.
  • The gross profit margin for TEXTAINER GROUP HOLDINGS LTD is currently very high, coming in at 86.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 47.58% significantly outperformed against the industry average.
  • Net operating cash flow has increased to $79.42 million or 46.13% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 27.51%.
  • TEXTAINER GROUP HOLDINGS LTD' earnings per share from the most recent quarter came in slightly below the year earlier quarter. 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, TEXTAINER GROUP HOLDINGS LTD increased its bottom line by earning $3.96 versus $3.80 in the prior year. This year, the market expects an improvement in earnings ($4.01 versus $3.96).

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

Six Flags Entertainment

Dividend Yield: 5.20%

Six Flags Entertainment (NYSE: SIX) shares currently have a dividend yield of 5.20%.

Six Flags Entertainment Corporation owns and operates regional theme, water, and zoological parks. The company's parks offer various state-of-the-art and traditional thrill rides, water attractions, themed areas, concerts and shows, restaurants, game venues, and retail outlets. The company has a P/E ratio of 11.17. Currently there are 3 analysts that rate Six Flags Entertainment a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Six Flags Entertainment has been 545,800 shares per day over the past 30 days. Six Flags Entertainment has a market cap of $3.5 billion and is part of the leisure industry. Shares are up 13% year to date as of the close of trading on Friday.

TheStreet Ratings rates Six Flags Entertainment 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, solid stock price performance 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:
  • SIX's revenue growth has slightly outpaced the industry average of 2.8%. Since the same quarter one year prior, revenues slightly increased by 4.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 237.76% and other important driving factors, this stock has surged by 50.52% 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, SIX 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 Hotels, Restaurants & Leisure industry and the overall market, SIX FLAGS ENTERTAINMENT CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • 42.90% is the gross profit margin for SIX FLAGS ENTERTAINMENT CORP which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 99.93% significantly outperformed against the industry average.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 241.0% when compared to the same quarter one year prior, rising from -$102.01 million to $143.83 million.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

W. P. Carey

Dividend Yield: 4.10%

W. P. Carey (NYSE: WPC) shares currently have a dividend yield of 4.10%.

W. P. Carey Inc. is an independent equity real estate investment trust. The firm also provides long-term sale-leaseback and build-to-suit financing for companies. It invests in the real estate markets across the globe. The company has a P/E ratio of 49.97. Currently there is 1 analyst that rates W. P. Carey a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for W. P. Carey has been 237,500 shares per day over the past 30 days. W. P. Carey has a market cap of $4.4 billion and is part of the real estate industry. Shares are up 31.3% year to date as of the close of trading on Friday.

TheStreet Ratings rates W. P. Carey as a buy. 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 these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • WPC's very impressive revenue growth greatly exceeded the industry average of 16.4%. Since the same quarter one year prior, revenues leaped by 181.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 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 38.26% 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, WPC 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 Real Estate Investment Trusts (REITs) industry. The net income increased by 70.3% when compared to the same quarter one year prior, rising from $9.09 million to $15.48 million.
  • Net operating cash flow has significantly increased by 180.02% to $48.90 million when compared to the same quarter last year. In addition, W P CAREY INC has also vastly surpassed the industry average cash flow growth rate of 32.95%.
  • The gross profit margin for W P CAREY INC is rather high; currently it is at 68.90%. Regardless of WPC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, WPC's net profit margin of 9.32% is significantly lower than the industry average.

New From TheStreet: Jim Cramer's Protégé, Dave Peltier, only buys dividend stocks that have the potential for a 3% to 4% yield and 10% growth. Get his best picks for less than $50/year.

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Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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