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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."

Dorchester Minerals

Dividend Yield: 7.30%

Dorchester Minerals

(NASDAQ:

DMLP

) shares currently have a dividend yield of 7.30%.

Dorchester Minerals, L.P. engages in the acquisition, ownership, and administration of producing and nonproducing natural gas and crude oil royalty, net profits, and leasehold interests in the United States. The company has a P/E ratio of 26.10.

The average volume for Dorchester Minerals has been 47,600 shares per day over the past 30 days. Dorchester Minerals has a market cap of $336.2 million and is part of the financial services industry. Shares are up 13.6% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Dorchester Minerals

TheStreet Recommends

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, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • DMLP 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 23.89, which clearly demonstrates the ability to cover short-term cash needs.
  • The gross profit margin for DORCHESTER MINERALS -LP is currently very high, coming in at 86.80%. Regardless of DMLP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DMLP's net profit margin of 36.86% significantly outperformed against the industry.
  • DMLP, with its decline in revenue, underperformed when compared the industry average of 34.6%. Since the same quarter one year prior, revenues fell by 47.7%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • DORCHESTER MINERALS -LP 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, DORCHESTER MINERALS -LP reported lower earnings of $0.42 versus $1.42 in the prior year.
  • Net operating cash flow has significantly decreased to $5.22 million or 51.02% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.

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Whitestone REIT

Dividend Yield: 9.10%

Whitestone REIT

(NYSE:

WSR

) shares currently have a dividend yield of 9.10%.

WhiteStone REIT is a Maryland REIT engaged in owning and operating commercial properties in culturally diverse markets in major metropolitan areas. The company has a P/E ratio of 52.46.

The average volume for Whitestone REIT has been 177,000 shares per day over the past 30 days. Whitestone REIT has a market cap of $340.0 million and is part of the real estate industry. Shares are up 4.2% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Whitestone REIT

as a

hold

. The company's strengths can be seen in multiple areas, such as its robust revenue growth, growth in earnings per share 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 deteriorating net income.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 7.9%. Since the same quarter one year prior, revenues rose by 33.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • WHITESTONE REIT 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, WHITESTONE REIT increased its bottom line by earning $0.24 versus $0.22 in the prior year. This year, the market expects an improvement in earnings ($0.27 versus $0.24).
  • 44.83% is the gross profit margin for WHITESTONE REIT which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, WSR's net profit margin of 7.99% significantly trails the industry average.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Real Estate Investment Trusts (REITs) industry average. The net income has significantly decreased by 28.2% when compared to the same quarter one year ago, falling from $2.86 million to $2.05 million.
  • WSR has underperformed the S&P 500 Index, declining 20.85% 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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UMH Properties

Dividend Yield: 7.30%

UMH Properties

(NYSE:

UMH

) shares currently have a dividend yield of 7.30%.

UMH Properties, Inc. (UMH) is a real estate investment trust. The firm engages in the ownership and operation of manufactured home communities. It leases manufactured home spaces to private manufactured home owners, as well as leases homes to residents. The company has a P/E ratio of 123.50.

The average volume for UMH Properties has been 72,900 shares per day over the past 30 days. UMH Properties has a market cap of $267.9 million and is part of the real estate industry. Shares are down 3.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

UMH Properties

as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from the ratings report include:

  • UMH's revenue growth has slightly outpaced the industry average of 7.9%. Since the same quarter one year prior, revenues rose by 15.7%. 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.
  • Net operating cash flow has increased to $11.70 million or 19.20% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 3.63%.
  • 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 88.9% when compared to the same quarter one year ago, falling from $1.56 million to $0.17 million.
  • 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. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, UMH PROPERTIES INC's return on equity significantly trails that of both the industry average and the S&P 500.

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