Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer

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."

Arbor Realty

Dividend Yield: 7.20%

Arbor Realty

(NYSE:

ABR

) shares currently have a dividend yield of 7.20%.

Arbor Realty Trust, Inc. operates as a real estate investment trust (REIT) in the United States. The company has a P/E ratio of 4.24.

The average volume for Arbor Realty has been 120,200 shares per day over the past 30 days. Arbor Realty has a market cap of $363.9 million and is part of the real estate industry. Shares are up 3.5% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Arbor Realty

as a

hold

. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and notable return on equity. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Real Estate Investment Trusts (REITs) industry average. The net income increased by 45.2% when compared to the same quarter one year prior, rising from $4.78 million to $6.94 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.9%. Since the same quarter one year prior, revenues slightly increased by 2.8%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The gross profit margin for ARBOR REALTY TRUST INC is rather high; currently it is at 54.88%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ABR's net profit margin of 21.06% significantly trails the industry average.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • ARBOR REALTY TRUST INC has improved earnings per share by 42.9% 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 two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, ARBOR REALTY TRUST INC increased its bottom line by earning $1.71 versus $0.41 in the prior year. For the next year, the market is expecting a contraction of 71.6% in earnings ($0.49 versus $1.71).

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TransMontaigne Partners

Dividend Yield: 7.70%

TransMontaigne Partners

(NYSE:

TLP

) shares currently have a dividend yield of 7.70%.

TransMontaigne Partners L.P. operates as a terminaling and transportation company. The company has a P/E ratio of 19.62.

The average volume for TransMontaigne Partners has been 47,900 shares per day over the past 30 days. TransMontaigne Partners has a market cap of $559.8 million and is part of the energy industry. Shares are up 7.8% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

TransMontaigne Partners

as a

hold

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

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income increased by 8.6% when compared to the same quarter one year prior, going from $6.00 million to $6.52 million.
  • The gross profit margin for TRANSMONTAIGNE PARTNERS LP is rather high; currently it is at 52.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 18.26% significantly outperformed against the industry average.
  • The debt-to-equity ratio is somewhat low, currently at 0.63, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.97 is somewhat weak and could be cause for future problems.
  • TRANSMONTAIGNE PARTNERS LP's earnings per share improvement from the most recent quarter was slightly positive. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, TRANSMONTAIGNE PARTNERS LP reported lower earnings of $1.90 versus $2.31 in the prior year. For the next year, the market is expecting a contraction of 2.6% in earnings ($1.85 versus $1.90).
  • TLP has underperformed the S&P 500 Index, declining 16.34% 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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Cross Timbers Royalty

Dividend Yield: 8.10%

Cross Timbers Royalty

(NYSE:

CRT

) shares currently have a dividend yield of 8.10%.

Cross Timbers Royalty Trust operates as an express trust in the United States. The company's function is to collect and distribute monthly net profits income from royalty interests and overriding royalty interests to unit holders. The company has a P/E ratio of 8.17.

The average volume for Cross Timbers Royalty has been 35,200 shares per day over the past 30 days. Cross Timbers Royalty has a market cap of $134.9 million and is part of the energy industry. Shares are up 25% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Cross Timbers Royalty

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we find that the stock has had a generally disappointing performance in the past year.

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 19.8%. Since the same quarter one year prior, revenues rose by 10.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CRT 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 7.90, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for CROSS TIMBERS ROYALTY TRUST is currently very high, coming in at 100.00%. CRT has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, CRT's net profit margin of 97.13% significantly outperformed against the industry.
  • CROSS TIMBERS ROYALTY TRUST has improved earnings per share by 10.1% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, CROSS TIMBERS ROYALTY TRUST reported lower earnings of $2.31 versus $2.48 in the prior year.
  • CRT has underperformed the S&P 500 Index, declining 24.85% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

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