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."

America First Multifamily Investors

Dividend Yield: 10.30%

America First Multifamily Investors

(NASDAQ:

ATAX

) shares currently have a dividend yield of 10.30%.

America First Multifamily Investors, L.P. acquires, holds, sells, and deals in a portfolio of mortgage revenue bonds that have been issued to provide construction and/or permanent financing for multifamily and student housing, and commercial properties. The company has a P/E ratio of 21.13.

The average volume for America First Multifamily Investors has been 179,600 shares per day over the past 30 days. America First Multifamily Investors has a market cap of $292.8 million and is part of the real estate industry. Shares are down 4% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

America First Multifamily Investors

as a

hold

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

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 17.4%. Since the same quarter one year prior, revenues rose by 27.5%. 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.
  • The gross profit margin for AMERICA FIRST MULTIFAMILY-LP is currently very high, coming in at 79.17%. Regardless of ATAX's high profit margin, it has managed to decrease from the same period last year.
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Thrifts & Mortgage Finance industry average, but is less than that of the S&P 500. The net income has decreased by 23.2% when compared to the same quarter one year ago, dropping from $3.31 million to $2.54 million.
  • Net operating cash flow has decreased to $3.22 million or 27.88% when compared to the same quarter last year. Despite a decrease in cash flow AMERICA FIRST MULTIFAMILY-LP is still fairing well by exceeding its industry average cash flow growth rate of -57.11%.
  • 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. When compared to other companies in the Thrifts & Mortgage Finance industry and the overall market, AMERICA FIRST MULTIFAMILY-LP's return on equity is below that of both the industry average and the S&P 500.

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Navios Maritime Acquisition

Dividend Yield: 9.20%

Navios Maritime Acquisition

(NYSE:

NNA

) shares currently have a dividend yield of 9.20%.

Navios Maritime Acquisition Corporation provides marine transportation services worldwide. The company owns a fleet of crude oil, refined petroleum product, and chemical tankers. The company has a P/E ratio of 3.57.

The average volume for Navios Maritime Acquisition has been 436,700 shares per day over the past 30 days. Navios Maritime Acquisition has a market cap of $328.6 million and is part of the transportation industry. Shares are down 24.2% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Navios Maritime Acquisition

as a

hold

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

Highlights from the ratings report include:

  • The revenue growth greatly exceeded the industry average of 36.8%. Since the same quarter one year prior, revenues rose by 12.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • NAVIOS MARITIME ACQUISITION 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 two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, NAVIOS MARITIME ACQUISITION turned its bottom line around by earning $0.07 versus -$0.42 in the prior year. This year, the market expects an improvement in earnings ($0.56 versus $0.07).
  • The debt-to-equity ratio is very high at 2.04 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Regardless of the company's weak debt-to-equity ratio, NNA has managed to keep a strong quick ratio of 2.04, which demonstrates the ability to cover short-term cash needs.
  • NNA'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 35.89%, 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.

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New Mountain Finance

Dividend Yield: 11.80%

New Mountain Finance

(NYSE:

NMFC

) shares currently have a dividend yield of 11.80%.

New Mountain Finance Corporation is a Business Development Company specializing in investments in middle market companies and debt securities at various levels of the capital structure, including first and second lien debt, unsecured notes, bonds, and mezzanine securities. The company has a P/E ratio of 8.01.

The average volume for New Mountain Finance has been 413,800 shares per day over the past 30 days. New Mountain Finance has a market cap of $738.6 million and is part of the financial services industry. Shares are down 9.7% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

New Mountain Finance

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in net income and expanding profit margins. However, as a counter to these strengths, 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:

  • NMFC's revenue growth has slightly outpaced the industry average of 0.3%. Since the same quarter one year prior, revenues slightly increased by 7.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 32.3% when compared to the same quarter one year prior, rising from $7.41 million to $9.80 million.
  • NEW MOUNTAIN FINANCE CORP has improved earnings per share by 21.4% 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, NEW MOUNTAIN FINANCE CORP reported lower earnings of $0.87 versus $1.79 in the prior year. This year, the market expects an improvement in earnings ($1.38 versus $0.87).
  • 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. When compared to other companies in the Capital Markets industry and the overall market, NEW MOUNTAIN FINANCE CORP's return on equity is below that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$163.20 million or 1145.95% 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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