Top 3 Yielding Buy-Rated Stocks: SUNS, TICC, OMAB

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."

Solar Senior Capital

Dividend Yield: 8.90%

Solar Senior Capital (NASDAQ: SUNS) shares currently have a dividend yield of 8.90%.

Solar Senior Capital Ltd. is a business development company specializing in investments in leveraged, middle-market companies in the United States. The fund invests in the form of senior secured loans, including first lien, unitranche, and second lien debt instruments. The company has a P/E ratio of 12.93.

The average volume for Solar Senior Capital has been 93,400 shares per day over the past 30 days. Solar Senior Capital has a market cap of $182.0 million and is part of the financial services industry. Shares are down 13.7% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Solar Senior Capital as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and impressive record of earnings per share growth. 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 3.0%. Since the same quarter one year prior, revenues slightly increased by 8.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving 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 Capital Markets industry. The net income increased by 30.6% when compared to the same quarter one year prior, rising from $1.49 million to $1.94 million.
  • Net operating cash flow has significantly increased by 135.72% to $4.69 million when compared to the same quarter last year. In addition, SOLAR SENIOR CAPITAL LTD has also vastly surpassed the industry average cash flow growth rate of -89.01%.
  • The gross profit margin for SOLAR SENIOR CAPITAL LTD is currently very high, coming in at 75.09%. Regardless of SUNS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SUNS's net profit margin of 37.78% significantly outperformed against the industry.
  • SOLAR SENIOR CAPITAL LTD has improved earnings per share by 30.8% 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, SOLAR SENIOR CAPITAL LTD reported lower earnings of $1.11 versus $1.46 in the prior year. This year, the market expects an improvement in earnings ($1.17 versus $1.11).

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TICC Capital

Dividend Yield: 11.80%

TICC Capital (NASDAQ: TICC) shares currently have a dividend yield of 11.80%.

TICC Capital Corp., a business development company, operates as a closed-end, non-diversified management investment company. The firm invests in both public and private companies. The company has a P/E ratio of 8.92.

The average volume for TICC Capital has been 597,800 shares per day over the past 30 days. TICC Capital has a market cap of $591.2 million and is part of the financial services industry. Shares are down 5.9% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates TICC Capital as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, expanding profit margins and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

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 17.7%. 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 Capital Markets industry. The net income increased by 801.6% when compared to the same quarter one year prior, rising from $1.46 million to $13.14 million.
  • The gross profit margin for TICC CAPITAL CORP is currently very high, coming in at 74.66%. Regardless of TICC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TICC's net profit margin of 43.88% significantly outperformed against the industry.
  • TICC CAPITAL CORP 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, TICC CAPITAL CORP reported lower earnings of $1.11 versus $1.77 in the prior year. This year, the market expects an improvement in earnings ($1.13 versus $1.11).
  • In its most recent trading session, TICC has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.

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Grupo Aeroportuario del Centro Norte SAB de

Dividend Yield: 8.60%

Grupo Aeroportuario del Centro Norte SAB de (NASDAQ: OMAB) shares currently have a dividend yield of 8.60%.

Grupo Aeroportuario del Centro Norte, S.A.B. de C.V., through its subsidiaries, develops, operates, and maintains airports in Mexico. It also operates NH T2 Hotel inside Terminal 2 of the Mexico City International Airport. The company has a P/E ratio of 19.18.

The average volume for Grupo Aeroportuario del Centro Norte SAB de has been 21,600 shares per day over the past 30 days. Grupo Aeroportuario del Centro Norte SAB de has a market cap of $1.8 billion and is part of the transportation industry. Shares are up 32.2% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Grupo Aeroportuario del Centro Norte SAB de as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, 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 generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • OMAB's revenue growth has slightly outpaced the industry average of 13.6%. Since the same quarter one year prior, revenues rose by 15.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 30.66% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, OMAB should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Transportation Infrastructure industry and the overall market, GRUPO AEROPORTUARIO DEL CENT's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • The gross profit margin for GRUPO AEROPORTUARIO DEL CENT is rather high; currently it is at 63.88%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.93% is above that of the industry average.
  • Net operating cash flow has significantly increased by 65.54% to $30.27 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 53.37%.

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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