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."

CrossAmerica Partners

Dividend Yield: 9.20%

CrossAmerica Partners

(NYSE:

CAPL

) shares currently have a dividend yield of 9.20%.

CrossAmerica Partners LP operates as a wholesale distributor of motor fuels, and owns and leases real estate used in the retail distribution of motor fuels in the United States.

The average volume for CrossAmerica Partners has been 98,200 shares per day over the past 30 days. CrossAmerica Partners has a market cap of $645.7 million and is part of the energy industry. Shares are down 3.9% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

CrossAmerica Partners

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, good cash flow from operations and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, disappointing return on equity 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 144.6% when compared to the same quarter one year prior, rising from $4.16 million to $10.16 million.
  • Net operating cash flow has significantly increased by 444.82% to $32.44 million when compared to the same quarter last year. In addition, CROSSAMERICA PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -26.85%.
  • CROSSAMERICA PARTNERS LP has improved earnings per share by 38.1% 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, CROSSAMERICA PARTNERS LP swung to a loss, reporting -$0.22 versus $1.19 in the prior year. This year, the market expects an improvement in earnings ($0.33 versus -$0.22).
  • Currently the debt-to-equity ratio of 1.53 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Along with this, the company manages to maintain a quick ratio of 0.46, which clearly demonstrates the inability to cover short-term cash needs.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness 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, CROSSAMERICA PARTNERS LP underperformed against that of the industry average and is significantly less than that of the S&P 500.

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Consolidated Communications

Dividend Yield: 7.70%

Consolidated Communications

(NASDAQ:

CNSL

) shares currently have a dividend yield of 7.70%.

Consolidated Communications Holdings, Inc., through its subsidiaries, provides various integrated communications services to residential and business clients.

The average volume for Consolidated Communications has been 173,200 shares per day over the past 30 days. Consolidated Communications has a market cap of $1.0 billion and is part of the telecommunications industry. Shares are down 1.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Consolidated Communications

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 10.4%. Since the same quarter one year prior, revenues rose by 30.1%. 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 55.05% to $71.82 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 16.27%.
  • The gross profit margin for CONSOLIDATED COMM HLDGS INC is rather high; currently it is at 57.10%. Regardless of CNSL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.33% trails the industry average.
  • The debt-to-equity ratio is very high at 5.34 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, CNSL maintains a poor quick ratio of 0.80, which illustrates the inability to avoid short-term cash problems.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Diversified Telecommunication Services industry and the overall market, CONSOLIDATED COMM HLDGS INC's return on equity significantly trails that of both the industry average and the S&P 500.

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Monroe Capital

Dividend Yield: 10.70%

Monroe Capital

(NASDAQ:

MRCC

) shares currently have a dividend yield of 10.70%.

Monroe Capital Corporation is a business development company specializing in senior, unitranche and junior secured debt and, to a lesser extent, unsecured debt and equity investments in middle-market companies. The fund focuses on companies with a maximum of $25 million in EBITDA per year. The company has a P/E ratio of 10.64.

The average volume for Monroe Capital has been 62,500 shares per day over the past 30 days. Monroe Capital has a market cap of $168.4 million and is part of the real estate industry. Shares are down 2% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Monroe Capital

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 5.7%. Since the same quarter one year prior, revenues rose by 19.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • MONROE CAPITAL CORP has improved earnings per share by 8.6% 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. This trend suggests that the performance of the business is improving. During the past fiscal year, MONROE CAPITAL CORP increased its bottom line by earning $1.45 versus $1.38 in the prior year. This year, the market expects an improvement in earnings ($1.63 versus $1.45).
  • MRCC has underperformed the S&P 500 Index, declining 10.08% from its price level of one year ago. 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.
  • Net operating cash flow has significantly decreased to -$60.19 million or 556.81% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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