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 "Sell."

Harte-Hanks

Dividend Yield: 12.40%

Harte-Hanks

(NYSE:

HHS

) shares currently have a dividend yield of 12.40%.

Harte-Hanks, Inc. provides various marketing services in the United States and internationally. The company operates in two segments, Customer Interaction and Trillium Software.

The average volume for Harte-Hanks has been 277,200 shares per day over the past 30 days. Harte-Hanks has a market cap of $168.4 million and is part of the media industry. Shares are down 13.3% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Harte-Hanks

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:

  • 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 Media industry. The net income has significantly decreased by 74.8% when compared to the same quarter one year ago, falling from $10.09 million to $2.54 million.
  • The gross profit margin for HARTE HANKS INC is rather low; currently it is at 19.15%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.95% significantly trails the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 51.89%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 75.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • HARTE HANKS INC 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. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, HARTE HANKS INC swung to a loss, reporting -$2.77 versus $0.38 in the prior year. This year, the market expects an improvement in earnings ($0.21 versus -$2.77).
  • HHS, with its decline in revenue, underperformed when compared the industry average of 7.8%. Since the same quarter one year prior, revenues fell by 11.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

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Transocean Partners

Dividend Yield: 16.50%

Transocean Partners

(NYSE:

RIGP

) shares currently have a dividend yield of 16.50%.

Transocean Partners LLC, together with its subsidiaries, operates as an offshore drilling contractor in the United States Gulf of Mexico. The company acquires, owns, and operates offshore drilling rigs. The company has a P/E ratio of 8.57.

The average volume for Transocean Partners has been 191,600 shares per day over the past 30 days. Transocean Partners has a market cap of $602.9 million and is part of the energy industry. Shares are up 1.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Transocean Partners

as a

sell

. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • RIGP'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 33.56%, 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.
  • TRANSOCEAN PARTNERS LLC 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, TRANSOCEAN PARTNERS LLC swung to a loss, reporting -$1.03 versus $1.25 in the prior year. This year, the market expects an improvement in earnings ($1.88 versus -$1.03).
  • Compared to other companies in the Energy Equipment & Services industry and the overall market on the basis of return on equity, TRANSOCEAN PARTNERS LLC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for TRANSOCEAN PARTNERS LLC is rather high; currently it is at 64.94%. It has increased from the same quarter the previous year.
  • Net operating cash flow has increased to $68.00 million or 38.77% when compared to the same quarter last year. In addition, TRANSOCEAN PARTNERS LLC has also vastly surpassed the industry average cash flow growth rate of -42.20%.

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Hoegh LNG Partners

Dividend Yield: 9.70%

Hoegh LNG Partners

(NYSE:

HMLP

) shares currently have a dividend yield of 9.70%.

Hoegh LNG Partners LP focuses on owning, operating, and acquiring floating storage and regasification units, liquefied natural gas (LNG) carriers, and other LNG infrastructure assets under long-term charters. Hoegh LNG GP LLC is the general partner of the company. The company has a P/E ratio of 11.06.

The average volume for Hoegh LNG Partners has been 49,100 shares per day over the past 30 days. Hoegh LNG Partners has a market cap of $446.5 million and is part of the transportation industry. Shares are down 8.4% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Hoegh LNG Partners

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • Currently the debt-to-equity ratio of 1.65 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 0.45, which clearly demonstrates the inability to cover short-term cash needs.
  • HMLP'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 27.82%, 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. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • HOEGH LNG PARTNERS LP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, HOEGH LNG PARTNERS LP increased its bottom line by earning $1.54 versus $0.04 in the prior year. This year, the market expects an improvement in earnings ($1.76 versus $1.54).
  • 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 217.3% when compared to the same quarter one year prior, rising from $5.19 million to $16.46 million.
  • The gross profit margin for HOEGH LNG PARTNERS LP is currently very high, coming in at 82.34%. It has increased significantly from the same period last year. Along with this, the net profit margin of 70.24% significantly outperformed against the industry average.

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