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."AllianceBernstein Holding L.P Dividend Yield: 7.40% AllianceBernstein Holding L.P (NYSE: AB) shares currently have a dividend yield of 7.40%. AllianceBernstein Holding L.P. is publicly owned investment manager. The firm also provides research services to its clients. The company has a P/E ratio of 11.87. The average volume for AllianceBernstein Holding L.P has been 249,300 shares per day over the past 30 days. AllianceBernstein Holding L.P has a market cap of $2.6 billion and is part of the financial services industry. Shares are down 2.5% year-to-date as of the close of trading on Monday. EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE. TheStreet Ratings rates AllianceBernstein Holding L.P as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, good cash flow from operations 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:
- AB's revenue growth has slightly outpaced the industry average of 6.9%. Since the same quarter one year prior, revenues rose by 12.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- ALLIANCEBERNSTEIN HOLDING LP has improved earnings per share by 9.1% 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, ALLIANCEBERNSTEIN HOLDING LP increased its bottom line by earning $1.86 versus $1.72 in the prior year. This year, the market expects an improvement in earnings ($1.98 versus $1.86).
- 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 12.5% when compared to the same quarter one year prior, going from $42.85 million to $48.22 million.
- Net operating cash flow has increased to $39.46 million or 27.10% when compared to the same quarter last year. In addition, ALLIANCEBERNSTEIN HOLDING LP has also vastly surpassed the industry average cash flow growth rate of -433.20%.
- The gross profit margin for ALLIANCEBERNSTEIN HOLDING LP is currently very high, coming in at 100.00%. AB has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, AB's net profit margin of 88.63% significantly outperformed against the industry.
- You can view the full AllianceBernstein Holding L.P Ratings Report.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry average. The net income increased by 5.0% when compared to the same quarter one year prior, going from $114.31 million to $120.07 million.
- The current debt-to-equity ratio, 0.40, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.21, which illustrates the ability to avoid short-term cash problems.
- 42.45% is the gross profit margin for SILICONWARE PRECISION INDS which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 17.26% trails the industry average.
- 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. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market on the basis of return on equity, SILICONWARE PRECISION INDS has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
- You can view the full Siliconware Precision Industries Ratings Report.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Gas Utilities industry. The net income increased by 32.3% when compared to the same quarter one year prior, rising from -$37.76 million to -$25.58 million.
- The gross profit margin for AMERIGAS PARTNERS -LP is rather high; currently it is at 58.63%. It has increased significantly from the same period last year.
- AMERIGAS PARTNERS -LP has improved earnings per share by 21.3% 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. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, AMERIGAS PARTNERS -LP increased its bottom line by earning $1.80 versus $1.43 in the prior year. For the next year, the market is expecting a contraction of 22.8% in earnings ($1.39 versus $1.80).
- APU, with its decline in revenue, slightly underperformed the industry average of 19.2%. Since the same quarter one year prior, revenues fell by 22.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Gas Utilities industry and the overall market, AMERIGAS PARTNERS -LP's return on equity exceeds that of both the industry average and the S&P 500.
- You can view the full AmeriGas Partners Ratings Report.
- Our dividend calendar.