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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."

Coach

Dividend Yield: 4.30%

Coach

(NYSE:

COH

) shares currently have a dividend yield of 4.30%.

Coach, Inc. provides luxury accessories and lifestyle collections for women and men in the United States and internationally. The company has a P/E ratio of 16.53.

The average volume for Coach has been 4,095,300 shares per day over the past 30 days. Coach has a market cap of $8.8 billion and is part of the consumer non-durables industry. Shares are down 16% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Coach

TheStreet Recommends

as a

hold

. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, 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 deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • Despite currently having a low debt-to-equity ratio of 0.36, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that COH's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.09 is high and demonstrates strong liquidity.
  • The gross profit margin for COACH INC is rather high; currently it is at 68.94%. Regardless of COH'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 1.16% trails the industry average.
  • 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 Textiles, Apparel & Luxury Goods industry and the overall market on the basis of return on equity, COACH INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • 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 Textiles, Apparel & Luxury Goods industry. The net income has significantly decreased by 84.5% when compared to the same quarter one year ago, falling from $75.28 million to $11.70 million.

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CBL & Associates Properties

Dividend Yield: 6.80%

CBL & Associates Properties

(NYSE:

CBL

) shares currently have a dividend yield of 6.80%.

CBL & Associates Properties, Inc. is a public real estate investment trust. It engages in acquisition, development, and management of properties. The fund invests in the real estate markets of United States. Its portfolio consists of enclosed malls and open-air centers. The company has a P/E ratio of 16.02.

The average volume for CBL & Associates Properties has been 1,495,800 shares per day over the past 30 days. CBL & Associates Properties has a market cap of $2.7 billion and is part of the real estate industry. Shares are down 17.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

CBL & Associates Properties

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 6.6%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 37.44% is the gross profit margin for CBL & ASSOCIATES PPTYS INC which we consider to be strong. Regardless of CBL's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CBL's net profit margin of 15.98% is significantly lower than the industry average.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, CBL & ASSOCIATES PPTYS INC's return on equity is below that of both the industry average and the S&P 500.
  • CBL has underperformed the S&P 500 Index, declining 15.16% 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.

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Stag Industrial

Dividend Yield: 7.20%

Stag Industrial

(NYSE:

STAG

) shares currently have a dividend yield of 7.20%.

STAG Industrial, Inc. is a real estate investment trust. The firm invests in the real estate markets of United States. It is engaged in investment and management of real estate assets. STAG Industrial, Inc. was founded on July 21, 2010 and is based in Boston, Massachusetts.

The average volume for Stag Industrial has been 636,300 shares per day over the past 30 days. Stag Industrial has a market cap of $1.3 billion and is part of the real estate industry. Shares are down 22.7% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Stag Industrial

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth and good cash flow from operations. 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:

  • The revenue growth came in higher than the industry average of 6.6%. Since the same quarter one year prior, revenues rose by 26.8%. 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.
  • Net operating cash flow has increased to $32.13 million or 22.23% when compared to the same quarter last year. In addition, STAG INDUSTRIAL INC has also vastly surpassed the industry average cash flow growth rate of -70.48%.
  • STAG INDUSTRIAL INC's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, STAG INDUSTRIAL INC reported poor results of -$0.27 versus -$0.21 in the prior year. This year, the market expects an improvement in earnings (-$0.25 versus -$0.27).
  • 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, STAG INDUSTRIAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for STAG INDUSTRIAL INC is currently extremely low, coming in at 7.01%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -9.14% is significantly below that of the industry average.

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