What To Buy: Top 3 Buy-Rated Dividend Stocks: NYCB, NS, BPL

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 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."

New York Community Bancorp

Dividend Yield: 6.40%

New York Community Bancorp (NYSE: NYCB) shares currently have a dividend yield of 6.40%.

New York Community Bancorp, Inc. operates as a multi-bank holding company for New York Community Bank and New York Commercial Bank that offer banking products and financial services in New York, New Jersey, Florida, Ohio, and Arizona. The company has a P/E ratio of 15.07.

The average volume for New York Community Bancorp has been 2,659,800 shares per day over the past 30 days. New York Community Bancorp has a market cap of $6.9 billion and is part of the banking industry. Shares are down 7.1% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates New York Community Bancorp as a buy. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, expanding profit margins, good cash flow from operations and solid stock price performance. 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 gross profit margin for NEW YORK CMNTY BANCORP INC is currently very high, coming in at 72.14%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 25.57% significantly outperformed against the industry average.
  • Net operating cash flow has increased to $47.30 million or 23.78% when compared to the same quarter last year. Despite an increase in cash flow of 23.78%, NEW YORK CMNTY BANCORP INC is still growing at a significantly lower rate than the industry average of 323.12%.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of 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.
  • The revenue fell significantly faster than the industry average of 29.8%. Since the same quarter one year prior, revenues slightly dropped by 6.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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

NuStar Energy L.P

Dividend Yield: 7.50%

NuStar Energy L.P (NYSE: NS) shares currently have a dividend yield of 7.50%.

NuStar Energy L.P. is engaged in the terminalling, storage, and marketing of petroleum products, and transportation of petroleum products and anhydrous ammonia primarily in the United States and the Netherlands. The company operates in three segments: Storage, Pipeline, and Fuels Marketing.

The average volume for NuStar Energy L.P has been 552,400 shares per day over the past 30 days. NuStar Energy L.P has a market cap of $4.6 billion and is part of the energy industry. Shares are up 14.9% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates NuStar Energy L.P as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, increase in net income and increase in stock price during the past year. 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:
  • NUSTAR ENERGY 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 year. We feel that this trend should continue. During the past fiscal year, NUSTAR ENERGY LP continued to lose money by earning -$2.89 versus -$3.05 in the prior year. This year, the market expects an improvement in earnings ($1.94 versus -$2.89).
  • 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 61.4% when compared to the same quarter one year prior, rising from $24.57 million to $39.64 million.
  • 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.
  • NS, with its decline in revenue, slightly underperformed the industry average of 7.5%. Since the same quarter one year prior, revenues fell by 15.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for NUSTAR ENERGY LP is rather low; currently it is at 17.45%. Regardless of NS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 4.66% 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.

Buckeye Partners

Dividend Yield: 5.70%

Buckeye Partners (NYSE: BPL) shares currently have a dividend yield of 5.70%.

Buckeye Partners, L.P. owns and operates liquid petroleum products pipeline systems in the United States. The company operates through four segments: Pipelines & Terminals, Global Marine Terminals, Merchant Services, and Development & Logistics. The company has a P/E ratio of 22.89.

The average volume for Buckeye Partners has been 338,300 shares per day over the past 30 days. Buckeye Partners has a market cap of $8.9 billion and is part of the energy industry. Shares are up 7.9% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Buckeye Partners 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, reasonable valuation levels, good cash flow from operations and solid stock price performance. 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 greatly exceeded the industry average of 7.5%. Since the same quarter one year prior, revenues rose by 44.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • BUCKEYE PARTNERS 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, BUCKEYE PARTNERS LP increased its bottom line by earning $3.23 versus $2.31 in the prior year. This year, the market expects an improvement in earnings ($3.82 versus $3.23).
  • Net operating cash flow has slightly increased to $100.09 million or 6.88% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -22.86%.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these 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.

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