Top 3 Yielding Buy-Rated Stocks: DOM, CRT, GSJK

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."

Dominion Resources Black Warrior

Dividend Yield: 9.70%

Dominion Resources Black Warrior (NYSE: DOM) shares currently have a dividend yield of 9.70%.

Dominion Resources Black Warrior Trust operates as a grantor trust in the United States. The company has a P/E ratio of 10.64.

The average volume for Dominion Resources Black Warrior has been 110,100 shares per day over the past 30 days. Dominion Resources Black Warrior has a market cap of $62.6 million and is part of the financial services industry. Shares are up 49% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Dominion Resources Black Warrior as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, solid stock price performance and impressive record of earnings per share growth. 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 greatly exceeded the industry average of 3.0%. Since the same quarter one year prior, revenues rose by 40.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • DOM 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.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, DOMINION RES BLACK WARRIOR's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Powered by its strong earnings growth of 50.00% and other important driving factors, this stock has surged by 51.84% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DOM should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • DOMINION RES BLACK WARRIOR 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, DOMINION RES BLACK WARRIOR increased its bottom line by earning $0.70 versus $0.54 in the prior year. This year, the market expects an improvement in earnings ($3.52 versus $0.70).

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

Cross Timbers Royalty

Dividend Yield: 10.20%

Cross Timbers Royalty (NYSE: CRT) shares currently have a dividend yield of 10.20%.

Cross Timbers Royalty Trust operates as an express trust in the United States. The company's function is to collect and distribute monthly net profits income from royalty interests and overriding royalty interests to unit holders. The company has a P/E ratio of 11.81.

The average volume for Cross Timbers Royalty has been 18,500 shares per day over the past 30 days. Cross Timbers Royalty has a market cap of $190.7 million and is part of the energy industry. Shares are up 8.2% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Cross Timbers Royalty as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, compelling growth in net income 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 came in higher than the industry average of 3.0%. Since the same quarter one year prior, revenues rose by 19.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • CRT 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. Along with this, the company maintains a quick ratio of 12.31, which clearly demonstrates the ability to cover short-term cash needs.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, CROSS TIMBERS ROYALTY TRUST's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Oil, Gas & Consumable Fuels industry average. The net income increased by 21.6% when compared to the same quarter one year prior, going from $3.10 million to $3.77 million.
  • The gross profit margin for CROSS TIMBERS ROYALTY TRUST is currently very high, coming in at 100.00%. CRT has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, CRT's net profit margin of 97.56% significantly outperformed against the industry.

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

Compressco Partners

Dividend Yield: 7.50%

Compressco Partners (NASDAQ: GSJK) shares currently have a dividend yield of 7.50%.

Compressco Partners, L.P. provides compression-based production enhancement services for natural gas and oil exploration and production companies. Its production enhancement services are used in both conventional wellhead compression applications and unconventional compression applications. The company has a P/E ratio of 19.27.

The average volume for Compressco Partners has been 314,900 shares per day over the past 30 days. Compressco Partners has a market cap of $647.3 million and is part of the energy industry. Shares are up 20.1% year-to-date as of the close of trading on Monday.

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 Compressco Partners as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • 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. 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.
  • COMPRESSCO 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, COMPRESSCO PARTNERS LP increased its bottom line by earning $1.11 versus $1.04 in the prior year. This year, the market expects an improvement in earnings ($1.25 versus $1.11).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Energy Equipment & Services industry. The net income increased by 96.9% when compared to the same quarter one year prior, rising from $2.48 million to $4.88 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 19.2%. Since the same quarter one year prior, revenues rose by 14.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • GSJK's debt-to-equity ratio is very low at 0.23 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, GSJK has a quick ratio of 1.86, which demonstrates the ability of the company to cover short-term liquidity needs.

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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