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."

Banco Santander Brasil SA/Brazil

Dividend Yield: 9.00%

Banco Santander Brasil SA/Brazil

(NYSE:

BSBR

) shares currently have a dividend yield of 9.00%.

Banco Santander (Brasil) S.A. provides banking products and services in Brazil and internationally. The company offers commercial banking, investment, mortgage, leasing, credit card, and foreign exchange services, as well as various lending and financing services.

The average volume for Banco Santander Brasil SA/Brazil has been 1,794,900 shares per day over the past 30 days. Banco Santander Brasil SA/Brazil has a market cap of $36.0 billion and is part of the banking industry. Shares are up 21.6% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Banco Santander Brasil SA/Brazil

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and good cash flow from operations. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 5.5%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Commercial Banks industry and the overall market, BANCO SANTANDER BRASIL -ADR's return on equity exceeds that of both the industry average and the S&P 500.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. 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.
  • BANCO SANTANDER BRASIL -ADR reported flat earnings per share in the most recent quarter. 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, BANCO SANTANDER BRASIL -ADR increased its bottom line by earning $0.64 versus $0.56 in the prior year. For the next year, the market is expecting a contraction of 49.4% in earnings ($0.32 versus $0.64).
  • The change in net income from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Commercial Banks industry average. The net income has decreased by 3.0% when compared to the same quarter one year ago, dropping from $395.61 million to $383.64 million.

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BG Staffing

Dividend Yield: 7.70%

BG Staffing

(AMEX:

BGSF

) shares currently have a dividend yield of 7.70%.

BG Staffing, Inc. operates as a temporary staffing company in the United States. The company operates through three segments: Commercial, Multifamily, and Professional. The company has a P/E ratio of 17.92.

The average volume for BG Staffing has been 3,500 shares per day over the past 30 days. BG Staffing has a market cap of $96.0 million and is part of the diversified services industry. Shares are down 12.5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

BG Staffing

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth and compelling growth in net income. 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:

  • BGSF's very impressive revenue growth greatly exceeded the industry average of 3.9%. Since the same quarter one year prior, revenues leaped by 55.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • BG STAFFING INC 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, BG STAFFING INC turned its bottom line around by earning $0.71 versus -$0.09 in the prior year. This year, the market expects an improvement in earnings ($1.01 versus $0.71).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Professional Services industry. The net income increased by 206.7% when compared to the same quarter one year prior, rising from $0.49 million to $1.50 million.
  • After a year of stock price fluctuations, the net result is that BGSF's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. 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.

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Marine Petroleum

Dividend Yield: 7.30%

Marine Petroleum

(NASDAQ:

MARPS

) shares currently have a dividend yield of 7.30%.

Marine Petroleum Trust, together with its subsidiary, Marine Petroleum Corporation, operates as a royalty trust in the United States. The company has a P/E ratio of 3.66.

The average volume for Marine Petroleum has been 2,700 shares per day over the past 30 days. Marine Petroleum has a market cap of $9.8 million and is part of the financial services industry. Shares are up 21.7% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Marine Petroleum

as a

hold

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • MARPS 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.
  • The gross profit margin for MARINE PETROLEUM TRUST is currently very high, coming in at 100.00%. MARPS has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, MARPS's net profit margin of 69.76% significantly outperformed against the industry.
  • MARPS, with its very weak revenue results, has greatly underperformed against the industry average of 34.6%. Since the same quarter one year prior, revenues plummeted by 74.0%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 58.51%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 80.64% compared to the year-earlier 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.
  • MARINE PETROLEUM TRUST 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. During the past fiscal year, MARINE PETROLEUM TRUST reported lower earnings of $0.94 versus $1.41 in the prior year.

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