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."

LaSalle Hotel Properties

Dividend Yield: 6.00%

LaSalle Hotel Properties (NYSE: LHO) shares currently have a dividend yield of 6.00%.

LaSalle Hotel Properties, a real estate investment trust (REIT), engages in the purchase, ownership, redevelopment, and leasing of primarily upscale and luxury full-service hotels in convention, resort, and urban business markets in the United States. The company has a P/E ratio of 18.23.

The average volume for LaSalle Hotel Properties has been 1,388,600 shares per day over the past 30 days. LaSalle Hotel Properties has a market cap of $3.4 billion and is part of the real estate industry. Shares are down 24.1% year-to-date as of the close of trading on Wednesday.

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

Highlights from the ratings report include:
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 9.0%. 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.
  • Net operating cash flow has increased to $111.86 million or 26.27% when compared to the same quarter last year. In addition, LASALLE HOTEL PROPERTIES has also modestly surpassed the industry average cash flow growth rate of 16.32%.
  • 48.00% is the gross profit margin for LASALLE HOTEL PROPERTIES which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, LHO's net profit margin of 17.24% significantly 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. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, LASALLE HOTEL PROPERTIES's return on equity is below that of both the industry average and the S&P 500.

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TC Pipelines

Dividend Yield: 6.80%

TC Pipelines (NYSE: TCP) shares currently have a dividend yield of 6.80%.

TC PipeLines, LP acquires, owns, and participates in the management of energy infrastructure businesses in North America. The company has a P/E ratio of 19.22.

The average volume for TC Pipelines has been 178,600 shares per day over the past 30 days. TC Pipelines has a market cap of $3.3 billion and is part of the energy industry. Shares are down 26.3% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates TC Pipelines 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, expanding profit margins and notable return on equity. 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 greatly exceeded the industry average of 34.6%. Since the same quarter one year prior, revenues slightly increased by 3.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • TC PIPELINES LP has improved earnings per share by 13.8% 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, TC PIPELINES LP increased its bottom line by earning $2.67 versus $2.13 in the prior year. This year, the market expects an improvement in earnings ($3.03 versus $2.67).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 18.9% when compared to the same quarter one year prior, going from $37.00 million to $44.00 million.
  • The gross profit margin for TC PIPELINES LP is currently very high, coming in at 78.82%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 51.76% significantly outperformed against 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. When compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TC PIPELINES LP's return on equity is below that of both the industry average and the S&P 500.

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Magellan Midstream Partners L.P

Dividend Yield: 4.40%

Magellan Midstream Partners L.P (NYSE: MMP) shares currently have a dividend yield of 4.40%.

Magellan Midstream Partners, L.P. engages in the transportation, storage, and distribution of refined petroleum products and crude oil in the United States. It operates in three segments: Refined Products, Crude Oil, and Marine Storage. The company has a P/E ratio of 17.76.

The average volume for Magellan Midstream Partners L.P has been 926,200 shares per day over the past 30 days. Magellan Midstream Partners L.P has a market cap of $15.4 billion and is part of the energy industry. Shares are down 16.3% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Magellan Midstream Partners L.P as a buy. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity, expanding profit margins, good cash flow from operations and impressive record of earnings per share growth. 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 net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 21.3% when compared to the same quarter one year prior, going from $146.26 million to $177.39 million.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, MAGELLAN MIDSTREAM PRTNRS LP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for MAGELLAN MIDSTREAM PRTNRS LP is rather high; currently it is at 53.66%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 36.38% significantly outperformed against the industry average.
  • Net operating cash flow has slightly increased to $223.74 million or 7.93% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -19.65%.
  • Despite the weak revenue results, MMP has significantly outperformed against the industry average of 34.6%. Since the same quarter one year prior, revenues slightly dropped by 1.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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