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."

Cedar Fair

Dividend Yield: 5.50%

Cedar Fair (NYSE: FUN) shares currently have a dividend yield of 5.50%.

Cedar Fair, L.P. owns and operates amusement and water parks, and hotels in the United States and Canada. The company operates approximately 11 amusement parks, 3 outdoor water parks, 1 indoor water park, and 5 hotels. The company has a P/E ratio of 26.15.

The average volume for Cedar Fair has been 173,500 shares per day over the past 30 days. Cedar Fair has a market cap of $3.1 billion and is part of the leisure industry. Shares are up 14.2% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Cedar Fair as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, increase in net income, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • FUN's revenue growth has slightly outpaced the industry average of 3.5%. Since the same quarter one year prior, revenues slightly increased by 4.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. 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.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 31.2% when compared to the same quarter one year prior, rising from $43.90 million to $57.58 million.
  • CEDAR FAIR -LP has improved earnings per share by 29.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CEDAR FAIR -LP reported lower earnings of $1.86 versus $1.94 in the prior year. This year, the market expects an improvement in earnings ($2.84 versus $1.86).
  • 49.54% is the gross profit margin for CEDAR FAIR -LP which we consider to be strong. Regardless of FUN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, FUN's net profit margin of 15.25% compares favorably to the industry average.

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Welltower

Dividend Yield: 4.80%

Welltower (NYSE: HCN) shares currently have a dividend yield of 4.80%.

Welltower Inc. is an independent equity real estate investment trust. The firm engages in acquiring, planning, developing, managing, repositioning and monetizing of real estate assets. It primarily invests in the real estate markets of the United States. The company has a P/E ratio of 27.48.

The average volume for Welltower has been 2,294,100 shares per day over the past 30 days. Welltower has a market cap of $24.3 billion and is part of the real estate industry. Shares are down 10.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Welltower as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. 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:
  • HCN's revenue growth has slightly outpaced the industry average of 9.8%. Since the same quarter one year prior, revenues rose by 17.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. 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.
  • WELLTOWER INC 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, WELLTOWER INC increased its bottom line by earning $1.40 versus $0.09 in the prior year. This year, the market expects an improvement in earnings ($2.41 versus $1.40).
  • 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 273.0% when compared to the same quarter one year prior, rising from $88.18 million to $328.93 million.

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Highwoods Properties

Dividend Yield: 4.10%

Highwoods Properties (NYSE: HIW) shares currently have a dividend yield of 4.10%.

Highwoods Properties, Inc. is a real estate investment trust. The trust engages in leasing, management, development, construction, and other customer-related services for its properties and for third parties. It invests in the real estate markets of United States. The company has a P/E ratio of 32.03.

The average volume for Highwoods Properties has been 835,600 shares per day over the past 30 days. Highwoods Properties has a market cap of $3.9 billion and is part of the real estate industry. Shares are down 7.3% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Highwoods 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, solid stock price performance and growth in earnings per share. We feel its strengths outweigh the fact that the company shows low profit margins.

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 6.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Net operating cash flow has slightly increased to $89.19 million or 7.26% when compared to the same quarter last year. Despite an increase in cash flow, HIGHWOODS PROPERTIES INC's average is still marginally south of the industry average growth rate of 16.13%.
  • After a year of stock price fluctuations, the net result is that HIW's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. 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.
  • HIGHWOODS PROPERTIES INC has improved earnings per share by 8.0% 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, HIGHWOODS PROPERTIES INC increased its bottom line by earning $1.19 versus $0.66 in the prior year. For the next year, the market is expecting a contraction of 21.8% in earnings ($0.93 versus $1.19).

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