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."

Navient

Dividend Yield: 4.50%

Navient

(NASDAQ:

NAVI

) shares currently have a dividend yield of 4.50%.

Navient Corporation provides financial products and services in the United States. The company operates in three segments: Federal Family Education Loan Program (FFELP) Loans, Private Education Loans, and Business Services. The company has a P/E ratio of 6.11.

The average volume for Navient has been 2,953,000 shares per day over the past 30 days. Navient has a market cap of $4.7 billion and is part of the financial services industry. Shares are up 24.2% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Navient

as a

hold

. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and generally higher debt management risk.

Highlights from the ratings report include:

  • The gross profit margin for NAVIENT CORP is currently very high, coming in at 70.59%. 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 10.59% trails the industry average.
  • NAVI, with its decline in revenue, slightly underperformed the industry average of 1.2%. Since the same quarter one year prior, revenues slightly dropped by 8.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 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 Consumer Finance industry. The net income has significantly decreased by 31.3% when compared to the same quarter one year ago, falling from $182.00 million to $125.00 million.
  • The debt-to-equity ratio is very high at 33.16 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.

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Waddell & Reed Financial

Dividend Yield: 9.90%

Waddell & Reed Financial

(NYSE:

WDR

) shares currently have a dividend yield of 9.90%.

Waddell & Reed Financial, Inc., through its subsidiaries, provides investment management and advisory, investment product underwriting and distribution, and shareholder services administration to mutual funds, and institutional and separately managed accounts in the United States. The company has a P/E ratio of 7.20.

The average volume for Waddell & Reed Financial has been 1,705,700 shares per day over the past 30 days. Waddell & Reed Financial has a market cap of $1.5 billion and is part of the financial services industry. Shares are down 35.9% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Waddell & Reed Financial

as a

hold

. Among the primary strengths of the company is its respectable return on equity which we feel is likely to continue. At the same time, however, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and poor profit margins.

Highlights from the ratings report include:

  • WDR, with its decline in revenue, slightly underperformed the industry average of 13.7%. Since the same quarter one year prior, revenues fell by 19.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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 Capital Markets industry and the overall market, WADDELL&REED FINL INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 58.59%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 43.75% compared to the year-earlier quarter. 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 gross profit margin for WADDELL&REED FINL INC is currently lower than what is desirable, coming in at 27.69%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 11.78% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$47.28 million or 152.37% 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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CVR Energy

Dividend Yield: 14.60%

CVR Energy

(NYSE:

CVI

) shares currently have a dividend yield of 14.60%.

CVR Energy, Inc., through its subsidiaries, engages in petroleum refining and nitrogen fertilizer manufacturing activities in the United States. The company operates through two segments, Petroleum and Nitrogen Fertilizer. The company has a P/E ratio of 12.12.

The average volume for CVR Energy has been 788,200 shares per day over the past 30 days. CVR Energy has a market cap of $1.2 billion and is part of the energy industry. Shares are down 63.8% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

CVR Energy

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 feeble growth in the company's earnings per share, deteriorating net income and poor profit margins.

Highlights from the ratings report include:

  • CVI's debt-to-equity ratio of 0.72 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that CVI's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.72 is high and demonstrates strong liquidity.
  • The gross profit margin for CVR ENERGY INC is currently extremely low, coming in at 3.01%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -1.78% trails that of the industry average.
  • Net operating cash flow has significantly decreased to $21.60 million or 87.87% 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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