3 Hold-Rated Dividend Stocks: GMLP, PDM, BDN
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 "Hold."
Dividend Yield: 8.90%
(NASDAQ:
) shares currently have a dividend yield of 8.90%.
Golar LNG Partners LP owns and operates floating storage regasification units (FSRUs) and liquefied natural gas (LNG) carriers primarily in the Brazil, the United Arab Emirates, and Indonesia. As of April 25, 2014, its fleet consisted of five FSRUs and four LNG carriers. The company has a P/E ratio of 11.00.
The average volume for Golar LNG Partners has been 412,200 shares per day over the past 30 days. Golar LNG Partners has a market cap of $1.2 billion and is part of the transportation industry. Shares are down 18.5% year-to-date as of the close of trading on Thursday.
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TheStreet Ratings rates
Golar LNG Partners
as a
. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.
Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 19.8%. Since the same quarter one year prior, revenues rose by 15.8%. 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 GOLAR LNG PARTNERS LP is currently very high, coming in at 84.95%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 35.91% 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. In comparison to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, GOLAR LNG PARTNERS LP has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
- The share price of GOLAR LNG PARTNERS LP has not done very well: it is down 13.64% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- The debt-to-equity ratio is very high at 2.25 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
- You can view the full Golar LNG Partners Ratings Report.
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Dividend Yield: 4.80%
(NYSE:
) shares currently have a dividend yield of 4.80%.
Piedmont Office Realty Trust, Inc. engages in the acquisition and ownership of commercial real estate properties in the United States. Its property portfolio primarily consists of office and industrial buildings, warehouses, and manufacturing facilities. The company has a P/E ratio of 65.37.
The average volume for Piedmont Office Realty has been 977,000 shares per day over the past 30 days. Piedmont Office Realty has a market cap of $2.7 billion and is part of the real estate industry. Shares are down 4.7% year-to-date as of the close of trading on Thursday.
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TheStreet Ratings rates
Piedmont Office Realty
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.
Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.9%. Since the same quarter one year prior, revenues slightly increased by 7.3%. 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.
- Net operating cash flow has increased to $58.37 million or 24.89% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 8.19%.
- 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 Real Estate Investment Trusts (REITs) industry and the overall market, PIEDMONT OFFICE REALTY TRUST's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for PIEDMONT OFFICE REALTY TRUST is rather low; currently it is at 19.71%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 8.52% significantly trails the industry average.
- You can view the full Piedmont Office Realty Ratings Report.
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Dividend Yield: 4.10%
(NYSE:
) shares currently have a dividend yield of 4.10%.
Brandywine Realty Trust is a publically owned real estate investment trust. The firm invests in real estate markets of the United States. It makes investments in office, mixed-use, and industrial properties.
The average volume for Brandywine Realty has been 1,598,800 shares per day over the past 30 days. Brandywine Realty has a market cap of $2.7 billion and is part of the real estate industry. Shares are down 4.8% year-to-date as of the close of trading on Thursday.
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TheStreet Ratings rates
Brandywine Realty
as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.
Highlights from the ratings report include:
- Despite its growing revenue, the company underperformed as compared with the industry average of 9.9%. Since the same quarter one year prior, revenues slightly increased by 8.1%. 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 significantly increased by 50.30% to $56.00 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 8.19%.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 108.6% when compared to the same quarter one year ago, falling from $20.79 million to -$1.78 million.
- 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 Real Estate Investment Trusts (REITs) industry and the overall market, BRANDYWINE REALTY TRUST's return on equity significantly trails that of both the industry average and the S&P 500.
- You can view the full Brandywine Realty Ratings Report.
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Other helpful dividend tools from TheStreet:
- Our dividend calendar.
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