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."

LaSalle Hotel Properties

Dividend Yield: 8.00%

LaSalle Hotel Properties

(NYSE:

LHO

) shares currently have a dividend yield of 8.00%.

LaSalle Hotel Properties, a real estate investment trust (REIT), engages in the purchase, ownership, redevelopment, and leasing of primarily upscale and luxury full-service hotels in convention, resort, and urban business markets in the United States. The company has a P/E ratio of 19.45.

The average volume for LaSalle Hotel Properties has been 1,478,000 shares per day over the past 30 days. LaSalle Hotel Properties has a market cap of $2.6 billion and is part of the real estate industry. Shares are down 9.5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

LaSalle Hotel Properties

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth and reasonable valuation levels. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.

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 Real Estate Investment Trusts (REITs) industry. The net income increased by 232.7% when compared to the same quarter one year prior, rising from $2.72 million to $9.06 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 11.9%. Since the same quarter one year prior, revenues slightly increased by 4.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • LASALLE HOTEL PROPERTIES has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. 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, LASALLE HOTEL PROPERTIES reported lower earnings of $1.09 versus $1.88 in the prior year. This year, the market expects an improvement in earnings ($1.33 versus $1.09).
  • This stock's share value has moved by only 41.01% over the past year. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • 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 Real Estate Investment Trusts (REITs) industry and the overall market, LASALLE HOTEL PROPERTIES's return on equity is below that of both the industry average and the S&P 500.

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HollyFrontier

Dividend Yield: 4.80%

HollyFrontier

(NYSE:

HFC

) shares currently have a dividend yield of 4.80%.

HollyFrontier Corporation operates as an independent petroleum refiner in the United States. The company operates in two segments, Refining and HEP. The company has a P/E ratio of 9.71.

The average volume for HollyFrontier has been 2,718,800 shares per day over the past 30 days. HollyFrontier has a market cap of $4.8 billion and is part of the energy industry. Shares are down 33.3% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

HollyFrontier

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 notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow.

Highlights from the ratings report include:

  • HFC's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Despite the fact that HFC's debt-to-equity ratio is low, the quick ratio, which is currently 0.65, displays a potential problem in covering short-term cash needs.
  • The gross profit margin for HOLLYFRONTIER CORP is currently extremely low, coming in at 9.76%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.05% trails that of the industry average.
  • Net operating cash flow has significantly decreased to $6.64 million or 97.31% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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Lazard

Dividend Yield: 4.30%

Lazard

(NYSE:

LAZ

) shares currently have a dividend yield of 4.30%.

Lazard Ltd, together with its subsidiaries, operates as a financial advisory and asset management firm worldwide. The company has a P/E ratio of 4.63.

The average volume for Lazard has been 903,500 shares per day over the past 30 days. Lazard has a market cap of $4.5 billion and is part of the financial services industry. Shares are down 22.9% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Lazard

as a

hold

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, notable return on equity and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including poor profit margins, weak operating cash flow 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 Capital Markets industry. The net income increased by 19.4% when compared to the same quarter one year prior, going from $55.95 million to $66.82 million.
  • 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. Compared to other companies in the Capital Markets industry and the overall market, LAZARD LTD's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Despite the weak revenue results, LAZ has outperformed against the industry average of 24.3%. Since the same quarter one year prior, revenues fell by 14.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for LAZARD LTD is rather low; currently it is at 23.18%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 13.13% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$99.89 million or 385.66% 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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