3 Hold-Rated Dividend Stocks: MN, HTGC, NNA

These 3 dividend stocks are rated a Hold by TheStreet
By TheStreet Wire ,

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."

Manning & Napier

Dividend Yield: 7.20%

Manning & Napier

(NYSE:

MN

) shares currently have a dividend yield of 7.20%.

Manning & Napier, Inc is publicly owned investment manager. It provides its services to net worth individuals and institutions, including 401(k) plans, pension plans, taft-hartley plans, endowments and foundations. The firm manages separate client-focused equity and fixed income portfolios. The company has a P/E ratio of 10.78.

The average volume for Manning & Napier has been 110,600 shares per day over the past 30 days. Manning & Napier has a market cap of $134.6 million and is part of the financial services industry. Shares are up 5.9% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Manning & Napier

as a

hold

. The company's strengths can be seen in multiple areas, such as its attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • 36.08% is the gross profit margin for MANNING & NAPIER INC which we consider to be strong. Regardless of MN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MN's net profit margin of 3.74% is significantly lower than the industry average.
  • The share price of MANNING & NAPIER INC has not done very well: it is down 10.50% 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 company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Capital Markets industry and the overall market, MANNING & NAPIER INC's return on equity is below that of both the industry average and the S&P 500.

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Hercules Capital

Dividend Yield: 10.00%

Hercules Capital

(NYSE:

HTGC

) shares currently have a dividend yield of 10.00%.

Hercules Technology Growth Capital, Inc. The company has a P/E ratio of 10.53.

The average volume for Hercules Capital has been 221,000 shares per day over the past 30 days. Hercules Capital has a market cap of $915.7 million and is part of the real estate industry. Shares are up 2.3% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Hercules Capital

as a

hold

. 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 disappointing return on equity, deteriorating net income 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 23.7%. Since the same quarter one year prior, revenues rose by 19.8%. 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 HERCULES CAPITAL INC is currently very high, coming in at 81.37%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 36.71% significantly outperformed against the industry average.
  • The change in net income from the same quarter one year ago has exceeded that of the Capital Markets industry average, but is less than that of the S&P 500. The net income has significantly decreased by 34.8% when compared to the same quarter one year ago, falling from $21.92 million to $14.30 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. When compared to other companies in the Capital Markets industry and the overall market, HERCULES CAPITAL INC's return on equity is below that of both the industry average and the S&P 500.

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Navios Maritime Acquisition

Dividend Yield: 13.40%

Navios Maritime Acquisition

(NYSE:

NNA

) shares currently have a dividend yield of 13.40%.

Navios Maritime Acquisition Corporation provides marine transportation services worldwide. It owns a fleet of crude oil, refined petroleum product, and chemical tankers. The company has a P/E ratio of 2.53.

The average volume for Navios Maritime Acquisition has been 550,300 shares per day over the past 30 days. Navios Maritime Acquisition has a market cap of $224.8 million and is part of the transportation industry. Shares are down 52.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Navios Maritime Acquisition

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, generally higher debt management risk and weak operating cash flow.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 24.1%. Since the same quarter one year prior, revenues slightly increased by 2.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, NAVIOS MARITIME ACQUISITION's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • The gross profit margin for NAVIOS MARITIME ACQUISITION is currently very high, coming in at 97.43%. Regardless of NNA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NNA's net profit margin of 29.55% significantly outperformed against the industry.
  • The debt-to-equity ratio is very high at 2.09 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, NNA's quick ratio is somewhat strong at 1.07, demonstrating the ability to handle short-term liquidity needs.
  • Net operating cash flow has decreased to $26.98 million or 20.90% when compared to the same quarter last year. Despite a decrease in cash flow NAVIOS MARITIME ACQUISITION is still fairing well by exceeding its industry average cash flow growth rate of -49.95%.

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