3 Buy-Rated Dividend Stocks: LRY, BX, CLMT

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

Liberty Property

Dividend Yield: 4.90%

Liberty Property (NYSE: LRY) shares currently have a dividend yield of 4.90%.

Liberty Property Trust is a publicly owned real estate investment holding trust. Through its subsidiary, it provides leasing, property management, development, acquisition, and other tenant-related services for a portfolio of industrial and office properties. The company has a P/E ratio of 37.84.

The average volume for Liberty Property has been 734,100 shares per day over the past 30 days. Liberty Property has a market cap of $4.7 billion and is part of the real estate industry. Shares are up 7.4% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Liberty Property as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, reasonable valuation levels and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

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 92.1% when compared to the same quarter one year prior, rising from $37.09 million to $71.24 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 12.1%. Since the same quarter one year prior, revenues slightly increased by 6.2%. 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 where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. 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.
  • LIBERTY PROPERTY TRUST's earnings per share declined by 10.7% 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, LIBERTY PROPERTY TRUST increased its bottom line by earning $1.05 versus $0.99 in the prior year. This year, the market expects an improvement in earnings ($1.22 versus $1.05).

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

Blackstone Group

Dividend Yield: 5.50%

Blackstone Group (NYSE: BX) shares currently have a dividend yield of 5.50%.

The Blackstone Group L.P., together with its subsidiaries, provides alternative asset management and financial advisory services worldwide. It operates in five segments: Private Equity, Real Estate, Hedge Fund Solutions, Credit Businesses, and Financial Advisory. The company has a P/E ratio of 37.24.

The average volume for Blackstone Group has been 5,028,700 shares per day over the past 30 days. Blackstone Group has a market cap of $12.2 billion and is part of the financial services industry. Shares are up 34.7% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Blackstone Group as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 6.4%. Since the same quarter one year prior, revenues rose by 30.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • BLACKSTONE GROUP LP 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, BLACKSTONE GROUP LP turned its bottom line around by earning $0.40 versus -$0.33 in the prior year. This year, the market expects an improvement in earnings ($2.29 versus $0.40).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 187.4% when compared to the same quarter one year prior, rising from $58.33 million to $167.64 million.
  • Net operating cash flow has significantly increased by 722.70% to $1,104.30 million when compared to the same quarter last year. In addition, BLACKSTONE GROUP LP has also vastly surpassed the industry average cash flow growth rate of -335.21%.
  • 37.00% is the gross profit margin for BLACKSTONE GROUP LP which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 13.44% 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.

Calumet Specialty Products Partners

Dividend Yield: 7.60%

Calumet Specialty Products Partners (NASDAQ: CLMT) shares currently have a dividend yield of 7.60%.

Calumet Specialty Products Partners, L.P. produces and sells specialty hydrocarbon and fuel products in North America. It operates in two segments, Specialty Products and Fuel Products. The company has a P/E ratio of 11.18.

The average volume for Calumet Specialty Products Partners has been 618,200 shares per day over the past 30 days. Calumet Specialty Products Partners has a market cap of $2.5 billion and is part of the energy industry. Shares are up 17.4% year to date as of the close of trading on Tuesday.

TheStreet Ratings rates Calumet Specialty Products Partners as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 10.5%. Since the same quarter one year prior, revenues rose by 12.7%. 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, CLMT's share price has jumped by 51.89%, 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, CLMT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • 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. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, CALUMET SPECIALTY PRODS -LP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • CALUMET SPECIALTY PRODS -LP's earnings per share declined by 31.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, CALUMET SPECIALTY PRODS -LP increased its bottom line by earning $3.53 versus $0.89 in the prior year. For the next year, the market is expecting a contraction of 9.9% in earnings ($3.18 versus $3.53).

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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