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."

Energy Transfer Partners

Dividend Yield: 13.50%

Energy Transfer Partners

(NYSE:

ETP

) shares currently have a dividend yield of 13.50%.

Energy Transfer Partners, L.P. engages in the natural gas midstream, and intrastate transportation and storage businesses in the United States.

The average volume for Energy Transfer Partners has been 8,403,300 shares per day over the past 30 days. Energy Transfer Partners has a market cap of $21.5 billion and is part of the energy industry. Shares are down 16.7% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Energy Transfer Partners

as a

hold

. Among the primary strengths of the company is its compelling growth in net income over time. At the same time, however, we also find weaknesses including a generally disappointing performance in the stock itself, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • 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 132.4% when compared to the same quarter one year prior, rising from -$142.00 million to $46.00 million.
  • Along with the very weak revenue results, ETP underperformed when compared to the industry average of 34.5%. Since the same quarter one year prior, revenues plummeted by 56.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • ENERGY TRANSFER PARTNERS -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 year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, ENERGY TRANSFER PARTNERS -LP reported lower earnings of $0.05 versus $1.64 in the prior year. This year, the market expects an improvement in earnings ($1.55 versus $0.05).
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 51.37%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 151.85% compared to the year-earlier quarter. Although its share price is down sharply from a year ago, do not assume that it can now be tagged as cheap and attractive. The reality is that, based on its current price in relation to its earnings, ETP is still more expensive than most of the other companies in its industry.
  • The debt-to-equity ratio of 1.38 is relatively high when compared with the industry average, suggesting a need for better debt level management.

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Computer Programs and Systems

Dividend Yield: 4.70%

Computer Programs and Systems

(NASDAQ:

CPSI

) shares currently have a dividend yield of 4.70%.

Computer Programs and Systems, Inc. provides healthcare information technology solutions for rural and community hospitals in the United States. The company's integrated enterprise-wide system automates clinical and financial data management in the functional areas of a hospital. The company has a P/E ratio of 33.80.

The average volume for Computer Programs and Systems has been 186,900 shares per day over the past 30 days. Computer Programs and Systems has a market cap of $618.9 million and is part of the computer software & services industry. Shares are up 8.9% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Computer Programs and Systems

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, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • CPSI 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 3.96, which clearly demonstrates the ability to cover short-term cash needs.
  • Compared to where it was trading a year ago, CPSI's share price has not changed very much due to (a) the relatively weak year-over-year performance of the overall market, (b) the company's stagnant earnings, and (c) other mixed 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.
  • 39.60% is the gross profit margin for COMPUTER PROGRAMS & SYSTEMS which we consider to be strong. Regardless of CPSI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 7.67% trails the industry average.
  • 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 Health Care Technology industry. The net income has significantly decreased by 49.7% when compared to the same quarter one year ago, falling from $6.74 million to $3.39 million.
  • Net operating cash flow has significantly decreased to $4.55 million or 64.66% 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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Chimera Investment

Dividend Yield: 13.80%

Chimera Investment

(NYSE:

CIM

) shares currently have a dividend yield of 13.80%.

Chimera Investment Corporation operates as a real estate investment trust in the United States. The company has a P/E ratio of 11.12.

The average volume for Chimera Investment has been 1,938,900 shares per day over the past 30 days. Chimera Investment has a market cap of $2.6 billion and is part of the real estate industry. Shares are up 0.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

Chimera Investment

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from the ratings report include:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Real Estate Investment Trusts (REITs) industry. The net income increased by 1678.4% when compared to the same quarter one year prior, rising from $6.49 million to $115.38 million.
  • CHIMERA INVESTMENT CORP 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, CHIMERA INVESTMENT CORP reported lower earnings of $1.29 versus $2.90 in the prior year. This year, the market expects an improvement in earnings ($2.09 versus $1.29).
  • CIM has underperformed the S&P 500 Index, declining 14.78% 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.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. When compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, CHIMERA INVESTMENT CORP's return on equity is below that of both the industry average and the S&P 500.

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