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."

NuStar GP Holdings

Dividend Yield: 11.60%

NuStar GP Holdings

(NYSE:

NSH

) shares currently have a dividend yield of 11.60%.

NuStar GP Holdings, LLC, through its ownership interests in NuStar Energy L.P., engages in the transportation of petroleum products and anhydrous ammonia; terminalling and storage of petroleum products; and marketing of petroleum products. The company has a P/E ratio of 10.95.

The average volume for NuStar GP Holdings has been 271,700 shares per day over the past 30 days. NuStar GP Holdings has a market cap of $808.1 million and is part of the energy industry. Shares are down 45.9% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

NuStar GP Holdings

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and expanding profit margins. 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:

  • The revenue growth greatly exceeded the industry average of 36.8%. Since the same quarter one year prior, revenues slightly increased by 2.4%. 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.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, NUSTAR GP HOLDINGS LLC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Looking at the price performance of NSH's shares over the past 12 months, there is not much good news to report: the stock is down 43.05%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter.
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Oil, Gas & Consumable Fuels industry average. The net income has decreased by 4.1% when compared to the same quarter one year ago, dropping from $17.64 million to $16.92 million.
  • Net operating cash flow has decreased to $22.05 million or 12.40% when compared to the same quarter last year. Despite a decrease in cash flow NUSTAR GP HOLDINGS LLC is still fairing well by exceeding its industry average cash flow growth rate of -26.85%.

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Medallion Financial

Dividend Yield: 13.80%

Medallion Financial

(NASDAQ:

TAXI

) shares currently have a dividend yield of 13.80%.

Medallion Financial Corp., through its subsidiaries, operates as a specialty finance company in the United States. The company engages in originating, acquiring, and servicing loans that finance taxicab medallions and various types of commercial businesses. The company has a P/E ratio of 5.85.

The average volume for Medallion Financial has been 206,700 shares per day over the past 30 days. Medallion Financial has a market cap of $176.5 million and is part of the financial services industry. Shares are down 28% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Medallion Financial

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. 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 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 9.2% when compared to the same quarter one year prior, going from $6.69 million to $7.31 million.
  • The gross profit margin for MEDALLION FINANCIAL CORP is rather high; currently it is at 61.84%. Regardless of TAXI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TAXI's net profit margin of 67.79% significantly outperformed against the industry.
  • MEDALLION FINANCIAL CORP has improved earnings per share by 11.1% 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, MEDALLION FINANCIAL CORP reported lower earnings of $1.14 versus $1.16 in the prior year. This year, the market expects an improvement in earnings ($1.23 versus $1.14).
  • TAXI's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 29.36%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • Net operating cash flow has significantly decreased to $0.38 million or 97.99% 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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CrossAmerica Partners

Dividend Yield: 9.00%

CrossAmerica Partners

(NYSE:

CAPL

) shares currently have a dividend yield of 9.00%.

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 100,900 shares per day over the past 30 days. CrossAmerica Partners has a market cap of $662.1 million and is part of the energy industry. Shares are down 37.7% year-to-date as of the close of trading on Monday.

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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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