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."

Blueknight Energy Partners

Dividend Yield: 11.90%

Blueknight Energy Partners

(NASDAQ:

BKEP

) shares currently have a dividend yield of 11.90%.

Blueknight Energy Partners, L.P. provides integrated terminalling, storage, processing, gathering, and transportation services for companies engaged in the production, distribution, and marketing of crude oil and asphalt products in the United States. The company has a P/E ratio of 48.80.

The average volume for Blueknight Energy Partners has been 86,900 shares per day over the past 30 days. Blueknight Energy Partners has a market cap of $161.1 million and is part of the energy industry. Shares are down 13.7% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Blueknight Energy Partners

as a

hold

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and a generally disappointing performance in the stock itself.

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 23.9% when compared to the same quarter one year prior, going from $11.27 million to $13.97 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, BLUEKNIGHT ENERGY PRTNRS LP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • BKEP's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 36.74%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The debt-to-equity ratio is very high at 2.03 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.50, which clearly demonstrates the inability to cover short-term cash needs.

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American Science & Engineering

Dividend Yield: 8.10%

American Science & Engineering

(NASDAQ:

ASEI

) shares currently have a dividend yield of 8.10%.

American Science and Engineering, Inc., together with its subsidiaries, develops, manufactures, markets, and sells X-ray inspection and other detection products for homeland security, force protection, public safety, and other defense and security applications in the US and internationally. The company has a P/E ratio of 494.60.

The average volume for American Science & Engineering has been 82,200 shares per day over the past 30 days. American Science & Engineering has a market cap of $177.3 million and is part of the electronics industry. Shares are down 43.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

TST Recommends

American Science & Engineering

as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from the ratings report include:

  • ASEI has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.97, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for AMERICAN SCIENCE ENGINEERING is rather high; currently it is at 53.28%. 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 -2.09% is in-line with the industry average.
  • The revenue fell significantly faster than the industry average of 2.5%. Since the same quarter one year prior, revenues fell by 40.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • AMERICAN SCIENCE ENGINEERING has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, AMERICAN SCIENCE ENGINEERING reported lower earnings of $0.13 versus $1.92 in the prior year. For the next year, the market is expecting a contraction of 38.5% in earnings ($0.08 versus $0.13).
  • 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 Aerospace & Defense industry. The net income has significantly decreased by 118.2% when compared to the same quarter one year ago, falling from $2.55 million to -$0.46 million.

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Navios Maritime Acquisition

Dividend Yield: 10.50%

Navios Maritime Acquisition

(NYSE:

NNA

) shares currently have a dividend yield of 10.50%.

Navios Maritime Acquisition Corporation provides marine transportation services worldwide. The company owns a fleet of crude oil, refined petroleum product, and chemical tankers. The company has a P/E ratio of 3.39.

The average volume for Navios Maritime Acquisition has been 469,000 shares per day over the past 30 days. Navios Maritime Acquisition has a market cap of $286.4 million and is part of the transportation industry. Shares are down 39.9% year-to-date as of the close of trading on Wednesday.

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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 and generally higher debt management risk.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 32.6%. Since the same quarter one year prior, revenues slightly increased by 6.0%. 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.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. 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.
  • NAVIOS MARITIME ACQUISITION's earnings per share declined by 23.5% 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, NAVIOS MARITIME ACQUISITION increased its bottom line by earning $0.55 versus $0.07 in the prior year. This year, the market expects an improvement in earnings ($0.56 versus $0.55).
  • The debt-to-equity ratio is very high at 2.21 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 1.13, demonstrating the ability to handle short-term liquidity needs.
  • Looking at the price performance of NNA's shares over the past 12 months, there is not much good news to report: the stock is down 42.13%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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