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."

Suburban Propane Partners

Dividend Yield: 14.70%

Suburban Propane Partners

(NYSE:

SPH

) shares currently have a dividend yield of 14.70%.

Suburban Propane Partners, L.P., through its subsidiaries, engages in the retail marketing and distribution of propane, fuel oil, and refined fuels. The company has a P/E ratio of 17.47.

The average volume for Suburban Propane Partners has been 348,600 shares per day over the past 30 days. Suburban Propane Partners has a market cap of $1.5 billion and is part of the utilities industry. Shares are down 0.4% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Suburban Propane Partners

as a

hold

. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, weak operating cash flow and generally higher debt management risk.

Highlights from the ratings report include:

  • 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 Gas Utilities industry and the overall market on the basis of return on equity, SUBURBAN PROPANE PRTNRS -LP has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • SPH, with its decline in revenue, underperformed when compared the industry average of 10.6%. Since the same quarter one year prior, revenues fell by 27.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Net operating cash flow has decreased to $65.07 million or 19.25% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Looking at the price performance of SPH's shares over the past 12 months, there is not much good news to report: the stock is down 45.32%, 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. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, SPH is still more expensive than most of the other companies in its industry.

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Annaly Capital Management

Dividend Yield: 12.70%

Annaly Capital Management

(NYSE:

NLY

) shares currently have a dividend yield of 12.70%.

Annaly Capital Management, Inc. owns a portfolio of real estate related investments in the United States.

The average volume for Annaly Capital Management has been 6,953,600 shares per day over the past 30 days. Annaly Capital Management has a market cap of $9.0 billion and is part of the real estate industry. Shares are up 0.3% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Annaly Capital Management

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 deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 231.55% to $1,418.60 million when compared to the same quarter last year. In addition, ANNALY CAPITAL MANAGEMENT has also vastly surpassed the industry average cash flow growth rate of 9.44%.
  • The gross profit margin for ANNALY CAPITAL MANAGEMENT is currently very high, coming in at 90.86%. Regardless of NLY's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, NLY's net profit margin of -115.89% significantly underperformed when compared to the industry average.
  • 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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 276.8% when compared to the same quarter one year ago, falling from $354.86 million to -$627.29 million.
  • 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 Real Estate Investment Trusts (REITs) industry and the overall market, ANNALY CAPITAL MANAGEMENT's return on equity significantly trails that of both the industry average and the S&P 500.

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Questar

Dividend Yield: 4.40%

Questar

(NYSE:

STR

) shares currently have a dividend yield of 4.40%.

Questar Corporation operates as an integrated natural gas company in the United States. The company has a P/E ratio of 15.28.

The average volume for Questar has been 1,686,800 shares per day over the past 30 days. Questar has a market cap of $3.3 billion and is part of the utilities industry. Shares are down 1.6% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Questar

as a

hold

. The company's strengths can be seen in multiple areas, such as its expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow, a generally disappointing performance in the stock itself and generally higher debt management risk.

Highlights from the ratings report include:

  • The gross profit margin for QUESTAR CORP is currently very high, coming in at 100.91%. It has increased significantly from the same period last year.
  • QUESTAR CORP's earnings per share declined by 18.2% 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, QUESTAR CORP increased its bottom line by earning $1.28 versus $0.91 in the prior year. This year, the market expects an improvement in earnings ($1.30 versus $1.28).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 10.6%. Since the same quarter one year prior, revenues slightly dropped by 9.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • Even though the current debt-to-equity ratio is 1.23, it is still below the industry average, suggesting that this level of debt is acceptable within the Gas Utilities industry. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.09 is very low and demonstrates very weak liquidity.
  • Net operating cash flow has decreased to $62.80 million or 20.20% 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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