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."

Washington REIT

Dividend Yield: 4.50%

Washington REIT

(NYSE:

WRE

) shares currently have a dividend yield of 4.50%.

Washington Real Estate Investment Trust is an equity real estate investment trust (REIT). The company engages in the ownership, operation, and development of real properties. The firm invests in real estate markets of the greater Washington D.C. metro region. The company has a P/E ratio of 61.25.

The average volume for Washington REIT has been 372,600 shares per day over the past 30 days. Washington REIT has a market cap of $1.8 billion and is part of the real estate industry. Shares are down 3.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Washington REIT

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year and notable return on equity. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and poor profit margins.

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 6.5%. 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.
  • WASHINGTON REIT has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, WASHINGTON REIT increased its bottom line by earning $0.06 versus $0.00 in the prior year. This year, the market expects an improvement in earnings ($0.50 versus $0.06).
  • The gross profit margin for WASHINGTON REIT is currently lower than what is desirable, coming in at 26.72%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 0.82% significantly trails 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 82.4% when compared to the same quarter one year ago, falling from $3.67 million to $0.65 million.

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Brandywine Realty

Dividend Yield: 4.40%

Brandywine Realty

(NYSE:

BDN

) shares currently have a dividend yield of 4.40%.

Brandywine Realty Trust is a publically owned real estate investment trust. The firm invests in real estate markets of the United States. It makes investments in office, mixed-use, and industrial properties. The company has a P/E ratio of 113.00.

The average volume for Brandywine Realty has been 2,117,100 shares per day over the past 30 days. Brandywine Realty has a market cap of $2.4 billion and is part of the real estate industry. Shares are down 15.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

TST Recommends

Brandywine Realty

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.

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 Real Estate Investment Trusts (REITs) industry. The net income increased by 129.6% when compared to the same quarter one year prior, rising from $8.77 million to $20.15 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 3.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • BRANDYWINE REALTY 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, BRANDYWINE REALTY TRUST swung to a loss, reporting -$0.01 versus $0.20 in the prior year. This year, the market expects an improvement in earnings ($0.18 versus -$0.01).
  • The gross profit margin for BRANDYWINE REALTY TRUST is rather low; currently it is at 22.88%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 13.28% significantly trails the industry average.
  • BDN has underperformed the S&P 500 Index, declining 6.56% from its price level of one year ago. Looking ahead, we do not see anything in this company's numbers that would change the one-year trend. It was down over the last twelve months; and it could be down again in the next twelve. Naturally, a bull or bear market could sway the movement of this stock.

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Total

Dividend Yield: 5.50%

Total

(NYSE:

TOT

) shares currently have a dividend yield of 5.50%.

TOTAL S.A. operates as an oil and gas company worldwide. The company operates through three segments: Upstream, Refining & Chemicals, and Marketing & Services.

The average volume for Total has been 2,609,100 shares per day over the past 30 days. Total has a market cap of $115.2 billion and is part of the energy industry. Shares are down 1.6% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Total

as a

hold

. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.58, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.80 is somewhat weak and could be cause for future problems.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 34.1%. Since the same quarter one year prior, revenues fell by 30.1%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • 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 4.3% when compared to the same quarter one year ago, dropping from $3,104.00 million to $2,971.00 million.
  • 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, TOTAL SA's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, TOT has underperformed the S&P 500 Index, declining 9.23% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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