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."

Sabine Royalty

Dividend Yield: 13.20%

Sabine Royalty

(NYSE:

SBR

) shares currently have a dividend yield of 13.20%.

Sabine Royalty Trust holds royalty and mineral interests in various oil and gas properties in the United States. The company has a P/E ratio of 7.70.

The average volume for Sabine Royalty has been 42,000 shares per day over the past 30 days. Sabine Royalty has a market cap of $467.0 million and is part of the financial services industry. Shares are down 11.3% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Sabine Royalty

as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, notable return on equity and expanding profit margins. 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:

  • SBR 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 3.86, which clearly demonstrates the ability to cover short-term cash needs.
  • 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, SABINE ROYALTY TRUST's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for SABINE ROYALTY TRUST is currently very high, coming in at 100.00%. SBR has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, SBR's net profit margin of 92.13% significantly outperformed against the industry.
  • The change in net income from the same quarter one year ago has exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income has significantly decreased by 39.7% when compared to the same quarter one year ago, falling from $15.73 million to $9.48 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 41.54%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 39.81% 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.

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Medley Capital

Dividend Yield: 14.30%

Medley Capital

(NYSE:

MCC

) shares currently have a dividend yield of 14.30%.

Medley Capital Corporation is a business development company. The fund seeks to invest in privately negotiated debt and equity securities of small and middle market companies. The company has a P/E ratio of 7.62.

The average volume for Medley Capital has been 322,500 shares per day over the past 30 days. Medley Capital has a market cap of $483.8 million and is part of the financial services industry. Shares are down 10% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Medley Capital

as a

hold

. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and disappointing return on equity.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 129.46% to $19.06 million when compared to the same quarter last year. In addition, MEDLEY CAPITAL CORP has also vastly surpassed the industry average cash flow growth rate of -425.92%.
  • The gross profit margin for MEDLEY CAPITAL CORP is rather high; currently it is at 65.07%. Regardless of MCC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MCC's net profit margin of 23.28% compares favorably to the industry average.
  • MCC, with its decline in revenue, underperformed when compared the industry average of 6.7%. Since the same quarter one year prior, revenues slightly dropped by 5.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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 Capital Markets industry and the overall market, MEDLEY CAPITAL CORP's return on equity significantly trails 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 29.80%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 57.57% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.

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CorEnergy Infrastructure

Dividend Yield: 10.30%

CorEnergy Infrastructure

(NYSE:

CORR

) shares currently have a dividend yield of 10.30%.

CorEnergy Infrastructure Trust, Inc. is an open-ended equity trust launched and managed by Corridor InfraTrust Management, LLC. The trust primarily owns midstream and downstream U.S. energy infrastructure assets subject to long-term triple net participating leases with energy companies. The company has a P/E ratio of 17.50.

The average volume for CorEnergy Infrastructure has been 598,500 shares per day over the past 30 days. CorEnergy Infrastructure has a market cap of $313.0 million and is part of the real estate industry. Shares are down 20.8% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

CorEnergy Infrastructure

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including 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 9.7%. Since the same quarter one year prior, revenues rose by 42.7%. 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.
  • CORENERGY INFRASTRUCTURE TR's earnings per share declined by 40.0% 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, CORENERGY INFRASTRUCTURE TR increased its bottom line by earning $0.23 versus $0.18 in the prior year. This year, the market expects an improvement in earnings ($0.34 versus $0.23).
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 33.64%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 40.00% 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 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, CORENERGY INFRASTRUCTURE TR's return on equity significantly trails that of both the industry average and the S&P 500.

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