Best Of The Buy-Rated Dividend Stocks: Top 3 Companies: TUP, SIX, CVI

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

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."

Tupperware Brands

Dividend Yield: 4.10%

Tupperware Brands (NYSE: TUP) shares currently have a dividend yield of 4.10%.

Tupperware Brands Corporation operates as a direct-to-consumer marketer of various products across a range of brands and categories worldwide. The company has a P/E ratio of 17.66.

The average volume for Tupperware Brands has been 573,300 shares per day over the past 30 days. Tupperware Brands has a market cap of $3.3 billion and is part of the consumer non-durables industry. Shares are up 5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Tupperware Brands as a buy. The company's strengths can be seen in multiple areas, such as its notable return on equity, good cash flow from operations and expanding profit margins. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • 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 Household Durables industry and the overall market, TUPPERWARE BRANDS CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to -$13.80 million or 24.59% when compared to the same quarter last year. In addition, TUPPERWARE BRANDS CORP has also vastly surpassed the industry average cash flow growth rate of -575.97%.
  • The gross profit margin for TUPPERWARE BRANDS CORP is rather high; currently it is at 67.07%. Regardless of TUP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TUP's net profit margin of 5.07% compares favorably to the industry average.
  • TUPPERWARE BRANDS CORP's earnings per share declined by 42.1% 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, TUPPERWARE BRANDS CORP reported lower earnings of $4.21 versus $5.18 in the prior year. This year, the market expects an improvement in earnings ($4.65 versus $4.21).
  • TUP, with its decline in revenue, underperformed when compared the industry average of 6.1%. Since the same quarter one year prior, revenues fell by 12.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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Six Flags Entertainment

Dividend Yield: 4.40%

Six Flags Entertainment (NYSE: SIX) shares currently have a dividend yield of 4.40%.

Six Flags Entertainment Corporation owns and operates regional theme, water, and zoological parks. Its parks offer various thrill rides, water attractions, themed areas, concerts and shows, restaurants, game venues, and retail outlets. The company has a P/E ratio of 73.45.

The average volume for Six Flags Entertainment has been 717,400 shares per day over the past 30 days. Six Flags Entertainment has a market cap of $4.5 billion and is part of the leisure industry. Shares are up 10.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Six Flags Entertainment as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, good cash flow from operations and solid stock price performance. We feel its 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:
  • The revenue growth came in higher than the industry average of 7.4%. Since the same quarter one year prior, revenues rose by 15.5%. 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.
  • 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 Hotels, Restaurants & Leisure industry and the overall market, SIX FLAGS ENTERTAINMENT CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to -$52.50 million or 12.35% when compared to the same quarter last year. In addition, SIX FLAGS ENTERTAINMENT CORP has also vastly surpassed the industry average cash flow growth rate of -68.57%.
  • SIX FLAGS ENTERTAINMENT CORP's earnings per share declined by 17.2% 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 two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, SIX FLAGS ENTERTAINMENT CORP reported lower earnings of $0.73 versus $1.20 in the prior year. This year, the market expects an improvement in earnings ($1.57 versus $0.73).
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry average. The net income has decreased by 14.9% when compared to the same quarter one year ago, dropping from -$61.20 million to -$70.33 million.

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CVR Energy

Dividend Yield: 5.10%

CVR Energy (NYSE: CVI) shares currently have a dividend yield of 5.10%.

CVR Energy, Inc., through its subsidiaries, engages in petroleum refining and nitrogen fertilizer manufacturing activities in the United States. The company operates through two segments, Petroleum and Nitrogen Fertilizer. The company has a P/E ratio of 33.76.

The average volume for CVR Energy has been 329,800 shares per day over the past 30 days. CVR Energy has a market cap of $3.4 billion and is part of the energy industry. Shares are up 1.2% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates CVR Energy as a buy. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself.

Highlights from the ratings report include:
  • The debt-to-equity ratio is somewhat low, currently at 0.67, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
  • CVI, with its decline in revenue, slightly underperformed the industry average of 37.8%. Since the same quarter one year prior, revenues fell by 43.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for CVR ENERGY INC is currently extremely low, coming in at 14.68%. Regardless of CVI'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 3.95% trails the industry average.
  • Net operating cash flow has decreased to $178.20 million or 36.65% when compared to the same quarter last year. Despite a decrease in cash flow CVR ENERGY INC is still fairing well by exceeding its industry average cash flow growth rate of -51.31%.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, CVR ENERGY INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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