Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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."

AG Mortgage Investment

Dividend Yield: 13.20%

AG Mortgage Investment

(NYSE:

MITT

) shares currently have a dividend yield of 13.20%.

AG Mortgage Investment Trust, Inc., a real estate investment trust, focuses on investing, acquiring, and managing a portfolio of residential mortgage assets, other real estate-related securities, and financial assets. The company has a P/E ratio of 5.25.

The average volume for AG Mortgage Investment has been 199,300 shares per day over the past 30 days. AG Mortgage Investment has a market cap of $516.9 million and is part of the real estate industry. Shares are down 1.8% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

AG Mortgage Investment

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and compelling growth in net income. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from the ratings report include:

  • MITT's very impressive revenue growth greatly exceeded the industry average of 0.6%. Since the same quarter one year prior, revenues leaped by 754.5%. Growth in the company's revenue appears to have helped boost the 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. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market on the basis of return on equity, AG MORTGAGE INVESTMENT TRUST has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • AG MORTGAGE INVESTMENT TRUST reported significant earnings per share improvement 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, AG MORTGAGE INVESTMENT TRUST swung to a loss, reporting -$1.60 versus $7.34 in the prior year. This year, the market expects an improvement in earnings ($2.48 versus -$1.60).
  • Net operating cash flow has decreased to $22.98 million or 14.26% when compared to the same quarter last year. Despite a decrease in cash flow AG MORTGAGE INVESTMENT TRUST is still fairing well by exceeding its industry average cash flow growth rate of -55.11%.

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Terra Nitrogen

Dividend Yield: 7.90%

Terra Nitrogen

(NYSE:

TNH

) shares currently have a dividend yield of 7.90%.

Terra Nitrogen Company, L.P. is engaged in the production and sale of nitrogen fertilizer products. It primarily offers anhydrous ammonia and urea ammonium nitrate solutions. Terra Nitrogen GP Inc. serves as the general partner of Terra Nitrogen Company, L.P. The company has a P/E ratio of 9.94.

The average volume for Terra Nitrogen has been 43,700 shares per day over the past 30 days. Terra Nitrogen has a market cap of $2.3 billion and is part of the chemicals industry. Shares are up 25.4% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates

Terra Nitrogen

as a

hold

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

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 6.1%. Since the same quarter one year prior, revenues slightly increased by 5.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • TNH 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 3.31, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for TERRA NITROGEN CO -LP is rather high; currently it is at 59.51%. Regardless of TNH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TNH's net profit margin of 53.29% significantly outperformed against the industry.
  • The change in net income from the same quarter one year ago has exceeded that of the Chemicals industry average, but is less than that of the S&P 500. The net income has decreased by 1.0% when compared to the same quarter one year ago, dropping from $72.70 million to $72.00 million.
  • TNH has underperformed the S&P 500 Index, declining 21.82% 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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Calumet Specialty Products Partners

Dividend Yield: 10.90%

Calumet Specialty Products Partners

(NASDAQ:

CLMT

) shares currently have a dividend yield of 10.90%.

Calumet Specialty Products Partners, L.P. produces and sells specialty hydrocarbon products in North America. It operates in two segments, Specialty Products and Fuel Products.

The average volume for Calumet Specialty Products Partners has been 374,100 shares per day over the past 30 days. Calumet Specialty Products Partners has a market cap of $1.8 billion and is part of the energy industry. Shares are up 9.8% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates

Calumet Specialty Products Partners

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and increase in net income. 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 revenue growth greatly exceeded the industry average of 21.4%. Since the same quarter one year prior, revenues rose by 11.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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 127.0% when compared to the same quarter one year prior, rising from -$34.80 million to $9.40 million.
  • Currently the debt-to-equity ratio of 1.78 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 the unfavorable debt-to-equity ratio, CLMT maintains a poor quick ratio of 0.71, 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 Oil, Gas & Consumable Fuels industry and the overall market, CALUMET SPECIALTY PRODS -LP's return on equity significantly trails that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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