Buy-Rated Dividend Stocks In The Top 4: TCAP, CPLP, CNSL, GLAD

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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

Triangle Capital Corporation

Dividend Yield: 7.70%

Triangle Capital Corporation (NYSE: TCAP) shares currently have a dividend yield of 7.70%.

Triangle Capital Corporation is a business development company specializing in private equity and mezzanine investments. The company has a P/E ratio of 12.10.

The average volume for Triangle Capital Corporation has been 148,100 shares per day over the past 30 days. Triangle Capital Corporation has a market cap of $776.9 million and is part of the financial services industry. Shares are up 2.2% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Triangle Capital Corporation as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, attractive valuation levels, compelling growth in net income and good cash flow from operations. 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 came in higher than the industry average of 8.8%. Since the same quarter one year prior, revenues rose by 12.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 Capital Markets industry and the overall market, TRIANGLE CAPITAL CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • 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 42.8% when compared to the same quarter one year prior, rising from $16.23 million to $23.17 million.
  • Net operating cash flow has significantly increased by 411.34% to $45.42 million when compared to the same quarter last year. In addition, TRIANGLE CAPITAL CORP has also vastly surpassed the industry average cash flow growth rate of 267.67%.

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

Capital Product Partners L.P

Dividend Yield: 9.00%

Capital Product Partners L.P (NASDAQ: CPLP) shares currently have a dividend yield of 9.00%.

Capital Product Partners L.P., a shipping company, provides marine transportation services in Greece. The company has a P/E ratio of 21.91.

The average volume for Capital Product Partners L.P has been 331,600 shares per day over the past 30 days. Capital Product Partners L.P has a market cap of $855.5 million and is part of the transportation industry. Shares are down 0.2% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Capital Product Partners L.P as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 5.6%. Since the same quarter one year prior, revenues rose by 12.6%. Growth in the company's revenue appears to have helped boost 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 Oil, Gas & Consumable Fuels industry. The net income increased by 359.5% when compared to the same quarter one year prior, rising from $7.22 million to $33.19 million.
  • The gross profit margin for CAPITAL PRODUCT PARTNERS LP is rather high; currently it is at 64.09%. Regardless of CPLP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CPLP's net profit margin of 77.65% significantly outperformed against the industry.
  • CPLP's debt-to-equity ratio of 0.73 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that CPLP's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.91 is high and demonstrates strong liquidity.
  • Powered by its strong earnings growth of 433.33% and other important driving factors, this stock has surged by 36.45% over the past year, outperforming the rise in the S&P 500 Index during the same period. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.

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

Consolidated Communications

Dividend Yield: 7.90%

Consolidated Communications (NASDAQ: CNSL) shares currently have a dividend yield of 7.90%.

Consolidated Communications Holdings, Inc., together with its subsidiaries, provides telecommunications services to residential and business customers in Illinois, Texas, Pennsylvania, California, Kansas, and Missouri. The company has a P/E ratio of 26.05.

The average volume for Consolidated Communications has been 195,900 shares per day over the past 30 days. Consolidated Communications has a market cap of $783.8 million and is part of the telecommunications industry. Shares are down 0.9% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Consolidated Communications as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity, good cash flow from operations, increase in stock price during the past year and impressive record of earnings per share growth. 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 net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Diversified Telecommunication Services industry. The net income increased by 1311.8% when compared to the same quarter one year prior, rising from -$0.97 million to $11.69 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. In comparison to the other companies in the Diversified Telecommunication Services industry and the overall market, CONSOLIDATED COMM HLDGS INC's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • Net operating cash flow has significantly increased by 176.14% to $56.39 million when compared to the same quarter last year. In addition, CONSOLIDATED COMM HLDGS INC has also vastly surpassed the industry average cash flow growth rate of -7.23%.
  • 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. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • CONSOLIDATED COMM HLDGS INC 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, CONSOLIDATED COMM HLDGS INC reported lower earnings of $0.13 versus $0.88 in the prior year. This year, the market expects an improvement in earnings ($0.97 versus $0.13).

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

Gladstone Capital

Dividend Yield: 8.40%

Gladstone Capital (NASDAQ: GLAD) shares currently have a dividend yield of 8.40%.

Gladstone Capital Corporation is a business development company specializing in investments in debt and equity securities. The company has a P/E ratio of 6.50.

The average volume for Gladstone Capital has been 129,900 shares per day over the past 30 days. Gladstone Capital has a market cap of $209.0 million and is part of the financial services industry. Shares are up 4.8% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Gladstone Capital as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity, attractive valuation levels, expanding profit margins and increase in stock price during the past year. 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 Capital Markets industry. The net income increased by 424.6% when compared to the same quarter one year prior, rising from $5.47 million to $28.68 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 Capital Markets industry and the overall market, GLADSTONE CAPITAL CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for GLADSTONE CAPITAL CORP is rather high; currently it is at 69.23%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 306.61% significantly outperformed against the industry average.
  • 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.

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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