Top 3 Yielding Buy-Rated Stocks: ARI, FULL, VOC

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."

Apollo Commercial Real Estate Finance

Dividend Yield: 9.60%

Apollo Commercial Real Estate Finance (NYSE: ARI) shares currently have a dividend yield of 9.60%.

Apollo Commercial Real Estate Finance, Inc. The company has a P/E ratio of 10.35.

The average volume for Apollo Commercial Real Estate Finance has been 369,600 shares per day over the past 30 days. Apollo Commercial Real Estate Finance has a market cap of $781.0 million and is part of the real estate industry. Shares are up 3% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Apollo Commercial Real Estate Finance as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, compelling growth in net income and increase in stock price during the past year. 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:
  • ARI's very impressive revenue growth greatly exceeded the industry average of 10.6%. Since the same quarter one year prior, revenues leaped by 59.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The gross profit margin for APOLLO COMMERCIAL RE FIN INC is currently very high, coming in at 84.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 82.48% significantly outperformed against the industry average.
  • Net operating cash flow has increased to $15.72 million or 39.07% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 17.20%.
  • 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 103.2% when compared to the same quarter one year prior, rising from $11.79 million to $23.96 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.

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

Full Circle Capital

Dividend Yield: 10.90%

Full Circle Capital (NASDAQ: FULL) shares currently have a dividend yield of 10.90%.

Full Circle Capital Corporation is a business development company specializing in debt and equity securities of smaller and lower middle-market companies. The company has a P/E ratio of 29.48.

The average volume for Full Circle Capital has been 117,500 shares per day over the past 30 days. Full Circle Capital has a market cap of $74.4 million and is part of the financial services industry. Shares are up 3.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Full Circle Capital as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share, compelling growth in net income, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • FULL's very impressive revenue growth greatly exceeded the industry average of 3.0%. Since the same quarter one year prior, revenues leaped by 71.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • FULL CIRCLE CAPITAL CORP 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, FULL CIRCLE CAPITAL CORP increased its bottom line by earning $0.52 versus $0.44 in the prior year. This year, the market expects an improvement in earnings ($0.72 versus $0.52).
  • 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 128.3% when compared to the same quarter one year prior, rising from $1.48 million to $3.38 million.
  • The gross profit margin for FULL CIRCLE CAPITAL CORP is currently very high, coming in at 77.69%. It has increased significantly from the same period last year. Along with this, the net profit margin of 65.43% significantly outperformed against the industry average.
  • Net operating cash flow has increased to -$3.54 million or 15.92% when compared to the same quarter last year. In addition, FULL CIRCLE CAPITAL CORP has also vastly surpassed the industry average cash flow growth rate of -89.11%.

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

VOC Energy

Dividend Yield: 10.40%

VOC Energy (NYSE: VOC) shares currently have a dividend yield of 10.40%.

VOC Energy Trust acquires and holds a term net profits interest of the net proceeds from production and sale of the interests in oil and natural gas properties in the states of Kansas and Texas. It has an 80% term net profits interest of the net proceeds on the underlying properties. The company has a P/E ratio of 7.37.

The average volume for VOC Energy has been 106,400 shares per day over the past 30 days. VOC Energy has a market cap of $254.3 million and is part of the energy industry. Shares are up 1.8% year-to-date as of the close of trading on Thursday.

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

TheStreet Ratings rates VOC Energy as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, expanding profit margins and growth in earnings per share. 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 3.5%. Since the same quarter one year prior, revenues slightly increased by 8.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • VOC has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, VOC ENERGY TRUST's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • The gross profit margin for VOC ENERGY TRUST is currently very high, coming in at 100.00%. VOC has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, VOC's net profit margin of 96.31% significantly outperformed against the industry.
  • VOC ENERGY TRUST has improved earnings per share by 8.3% 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, VOC ENERGY TRUST reported lower earnings of $1.68 versus $2.19 in the prior year. This year, the market expects an improvement in earnings ($1.86 versus $1.68).

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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