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: 9.10%

Solar Senior Capital (NASDAQ: SUNS) shares currently have a dividend yield of 9.10%.

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 13.31.

The average volume for Solar Senior Capital has been 41,800 shares per day over the past 30 days. Solar Senior Capital has a market cap of $178.1 million and is part of the financial services industry. Shares are up 6.8% year-to-date as of the close of trading on Friday.

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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, expanding profit margins, good cash flow from operations and notable return on equity. 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 came in higher than the industry average of 13.4%. Since the same quarter one year prior, revenues slightly increased by 8.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The gross profit margin for SOLAR SENIOR CAPITAL LTD is currently very high, coming in at 76.74%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 32.80% is above that of the industry average.
  • Net operating cash flow has significantly increased by 474.60% to $78.70 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 -95.23%.
  • SOLAR SENIOR CAPITAL LTD's earnings per share declined by 34.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over 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 ($1.16 versus $1.11).
  • 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. When compared to other companies in the Capital Markets industry and the overall market, SOLAR SENIOR CAPITAL LTD's return on equity is below that of both the industry average and the S&P 500.

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

BlackRock Kelso Capital Corporation

Dividend Yield: 10.00%

BlackRock Kelso Capital Corporation (NASDAQ: BKCC) shares currently have a dividend yield of 10.00%.

BlackRock Kelso Capital Corporation is Business Development Company specializing in investments in middle market companies. The fund invests in all industries. The company has a P/E ratio of 5.89.

The average volume for BlackRock Kelso Capital Corporation has been 389,500 shares per day over the past 30 days. BlackRock Kelso Capital Corporation has a market cap of $627.7 million and is part of the financial services industry. Shares are up 4% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates BlackRock Kelso Capital Corporation 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 compelling growth in net income. 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 13.4%. Since the same quarter one year prior, revenues slightly increased by 5.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Capital Markets industry and the overall market, BLACKROCK KELSO CAPITAL CORP's return on equity exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for BLACKROCK KELSO CAPITAL CORP is currently very high, coming in at 75.81%. It has increased significantly from the same period last year. Along with this, the net profit margin of 87.35% significantly outperformed against the industry average.
  • Net operating cash flow has significantly increased by 53.03% to -$51.77 million when compared to the same quarter last year. In addition, BLACKROCK KELSO CAPITAL CORP has also vastly surpassed the industry average cash flow growth rate of -95.23%.
  • 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 46.0% when compared to the same quarter one year prior, rising from $19.84 million to $28.97 million.

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

Whitestone REIT

Dividend Yield: 7.10%

Whitestone REIT (NYSE: WSR) shares currently have a dividend yield of 7.10%.

WhiteStone REIT is a Maryland REIT engaged in owning and operating commercial properties in culturally diverse markets in major metropolitan areas. The company has a P/E ratio of 61.96.

The average volume for Whitestone REIT has been 86,500 shares per day over the past 30 days. Whitestone REIT has a market cap of $367.8 million and is part of the real estate industry. Shares are up 3.6% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates Whitestone REIT as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 16.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 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. 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.
  • WHITESTONE REIT 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, WHITESTONE REIT increased its bottom line by earning $0.21 versus $0.04 in the prior year. This year, the market expects an improvement in earnings ($0.23 versus $0.21).
  • 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 79.6% when compared to the same quarter one year prior, rising from $0.61 million to $1.10 million.

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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