5 Buy-Rated Dividend Stocks: SPH, STWD, SIX, MPW, WPC

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."

Suburban Propane Partners

Dividend Yield: 7.50%

Suburban Propane Partners (NYSE: SPH) shares currently have a dividend yield of 7.50%.

Suburban Propane Partners, L.P., through its subsidiaries, engages in the retail marketing and distribution of propane, fuel oil, and refined fuels. The company has a P/E ratio of 34.36.

The average volume for Suburban Propane Partners has been 256,500 shares per day over the past 30 days. Suburban Propane Partners has a market cap of $2.6 billion and is part of the utilities industry. Shares are up 17.8% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Suburban Propane Partners as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, compelling growth in net income, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • SPH's very impressive revenue growth greatly exceeded the industry average of 9.9%. Since the same quarter one year prior, revenues leaped by 89.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The strong earnings growth this company has enjoyed -- up -- has apparently played a role in driving up its share price by a solid 30.23%. In addition, the rise in the general market has likely contributed to this stock's strong performance during this past year.Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains 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 Gas Utilities industry. The net income increased by 164.6% when compared to the same quarter one year prior, rising from $49.57 million to $131.15 million.
  • Net operating cash flow has significantly increased by 70.93% to $72.43 million when compared to the same quarter last year. In addition, SUBURBAN PROPANE PRTNRS -LP has also vastly surpassed the industry average cash flow growth rate of 5.01%.
  • SUBURBAN PROPANE PRTNRS -LP 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, SUBURBAN PROPANE PRTNRS -LP reported lower earnings of $0.48 versus $3.22 in the prior year. This year, the market expects an improvement in earnings ($2.12 versus $0.48).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Starwood Property

Dividend Yield: 7.30%

Starwood Property (NYSE: STWD) shares currently have a dividend yield of 7.30%.

Starwood Property Trust, Inc. engages in originating, investing in, financing, and managing commercial mortgage loans, other commercial real estate debt investments, commercial mortgage-backed securities, and other commercial real estate-related debt investments. The company has a P/E ratio of 15.01.

The average volume for Starwood Property has been 2,167,400 shares per day over the past 30 days. Starwood Property has a market cap of $4.2 billion and is part of the real estate industry. Shares are up 10.5% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Starwood Property as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, expanding profit margins, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

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 24.1% when compared to the same quarter one year prior, going from $50.16 million to $62.24 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 12.0%. Since the same quarter one year prior, revenues slightly increased by 7.0%. 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 gross profit margin for STARWOOD PROPERTY TRUST INC is currently very high, coming in at 77.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 74.81% significantly outperformed against the industry average.
  • STWD's share price has surged by 29.81% over the past year, reflecting the market's general trend, despite their weak earnings growth during the last quarter. Regarding the stock's future course, although almost any stock can fall in a broad market decline, STWD should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • STARWOOD PROPERTY TRUST INC's earnings per share declined by 13.2% 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, STARWOOD PROPERTY TRUST INC increased its bottom line by earning $1.78 versus $1.41 in the prior year. This year, the market expects an improvement in earnings ($1.94 versus $1.78).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Six Flags Entertainment

Dividend Yield: 4.80%

Six Flags Entertainment (NYSE: SIX) shares currently have a dividend yield of 4.80%.

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 10.50.

The average volume for Six Flags Entertainment has been 392,400 shares per day over the past 30 days. Six Flags Entertainment has a market cap of $3.6 billion and is part of the leisure industry. Shares are up 24.2% year to date as of the close of trading on Tuesday.

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, good cash flow from operations, 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:
  • The revenue growth came in higher than the industry average of 3.0%. Since the same quarter one year prior, revenues rose by 31.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 41.70% and other important driving factors, this stock has surged by 67.66% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains 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.
  • Net operating cash flow has increased to -$36.94 million or 13.63% when compared to the same quarter last year. In addition, SIX FLAGS ENTERTAINMENT CORP has also modestly surpassed the industry average cash flow growth rate of 9.08%.
  • 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 45.7% when compared to the same quarter one year prior, rising from -$115.11 million to -$62.53 million.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

Medical Properties

Dividend Yield: 5.30%

Medical Properties (NYSE: MPW) shares currently have a dividend yield of 5.30%.

Medical Properties Trust, Inc. operates as a real estate investment trust (REIT) in the United States. It acquires, develops, and invests in healthcare facilities; and leases healthcare facilities to healthcare operating companies and healthcare providers. The company has a P/E ratio of 22.04.

The average volume for Medical Properties has been 1,898,800 shares per day over the past 30 days. Medical Properties has a market cap of $2.2 billion and is part of the real estate industry. Shares are up 23.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Medical Properties as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 12.0%. Since the same quarter one year prior, revenues rose by 42.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 157.14% and other important driving factors, this stock has surged by 70.88% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • MEDICAL PROPERTIES TRUST 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. We feel that this trend should continue. During the past fiscal year, MEDICAL PROPERTIES TRUST increased its bottom line by earning $0.56 versus $0.13 in the prior year. This year, the market expects an improvement in earnings ($0.83 versus $0.56).
  • 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 147.6% when compared to the same quarter one year prior, rising from $10.56 million to $26.16 million.
  • The gross profit margin for MEDICAL PROPERTIES TRUST is currently very high, coming in at 71.00%. It has increased significantly from the same period last year. Along with this, the net profit margin of 44.38% significantly outperformed against the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

W. P. Carey

Dividend Yield: 4.90%

W. P. Carey (NYSE: WPC) shares currently have a dividend yield of 4.90%.

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 64.15.

The average volume for W. P. Carey has been 300,000 shares per day over the past 30 days. W. P. Carey has a market cap of $4.6 billion and is part of the real estate industry. Shares are up 26.8% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates W. P. Carey as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, increase in net income, good cash flow from operations and expanding profit margins. 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 12.0%. Since the same quarter one year prior, revenues leaped by 66.0%. 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.
  • Compared to its closing price of one year ago, WPC's share price has jumped by 48.20%, 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, 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 exceeded that of the S&P 500 and greatly outperformed compared to the Real Estate Investment Trusts (REITs) industry average. The net income increased by 15.4% when compared to the same quarter one year prior, going from $12.29 million to $14.18 million.
  • Net operating cash flow has significantly increased by 530.41% to $17.48 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 -16.08%.
  • The gross profit margin for W P CAREY INC is currently very high, coming in at 79.60%. It has increased significantly from the same period last year. Despite the strong results of the gross profit margin, WPC's net profit margin of 12.50% significantly trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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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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