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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."

Entergy

Dividend Yield: 4.70%

Entergy

(NYSE:

ETR

) shares currently have a dividend yield of 4.70%.

Entergy Corporation, together with its subsidiaries, engages in the electric power production and retail electric distribution operations in the United States. It operates in two segments, Utility and Entergy Wholesale Commodities. The company has a P/E ratio of 15.89.

The average volume for Entergy has been 1,520,500 shares per day over the past 30 days. Entergy has a market cap of $12.6 billion and is part of the utilities industry. Shares are down 20.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Entergy

TheStreet Recommends

as a

hold

. The company's strongest point has been its expanding profit margins. At the same time, however, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • ENTERGY CORP's earnings per share declined by 20.9% 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, ENTERGY CORP increased its bottom line by earning $5.22 versus $3.98 in the prior year. This year, the market expects an improvement in earnings ($5.36 versus $5.22).
  • ETR, with its decline in revenue, underperformed when compared the industry average of 0.8%. Since the same quarter one year prior, revenues slightly dropped by 9.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for ENTERGY CORP is currently lower than what is desirable, coming in at 29.05%. Regardless of ETR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.66% trails the industry average.
  • 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 Electric Utilities industry and the overall market, ENTERGY CORP's return on equity is below that of both the industry average and the S&P 500.
  • 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 Electric Utilities industry average. The net income has decreased by 20.9% when compared to the same quarter one year ago, dropping from $194.28 million to $153.72 million.

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Pembina Pipeline

Dividend Yield: 5.30%

Pembina Pipeline

(NYSE:

PBA

) shares currently have a dividend yield of 5.30%.

Pembina Pipeline Corporation provides transportation and midstream services for the energy industry in North America. It operates through four businesses: Conventional Pipelines, Oil Sands & Heavy Oil, Gas Services, and Midstream. The company has a P/E ratio of 40.45.

The average volume for Pembina Pipeline has been 383,000 shares per day over the past 30 days. Pembina Pipeline has a market cap of $9.2 billion and is part of the energy industry. Shares are down 29.1% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Pembina Pipeline

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 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, feeble growth in the company's earnings per share and disappointing return on equity.

Highlights from the ratings report include:

  • The current debt-to-equity ratio, 0.54, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.13, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has increased to $209.00 million or 34.83% when compared to the same quarter last year. In addition, PEMBINA PIPELINE CORP has also vastly surpassed the industry average cash flow growth rate of -19.60%.
  • Despite the weak revenue results, PBA has outperformed against the industry average of 34.5%. Since the same quarter one year prior, revenues fell by 24.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • PEMBINA PIPELINE CORP 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 suffered a declining pattern earnings per share over the past two years. During the past fiscal year, PEMBINA PIPELINE CORP reported lower earnings of $1.04 versus $1.11 in the prior year.
  • 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. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, PEMBINA PIPELINE CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.

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CBL & Associates Properties

Dividend Yield: 7.00%

CBL & Associates Properties

(NYSE:

CBL

) shares currently have a dividend yield of 7.00%.

CBL & Associates Properties, Inc. is a public real estate investment trust. It engages in acquisition, development, and management of properties. The fund invests in the real estate markets of United States. Its portfolio consists of enclosed malls and open-air centers. The company has a P/E ratio of 15.47.

The average volume for CBL & Associates Properties has been 1,582,900 shares per day over the past 30 days. CBL & Associates Properties has a market cap of $2.6 billion and is part of the real estate industry. Shares are down 22.5% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

CBL & Associates Properties

as a

hold

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

Highlights from the ratings report include:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 9.8%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 43.62% is the gross profit margin for CBL & ASSOCIATES PPTYS INC 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, CBL's net profit margin of 15.98% significantly trails the industry average.
  • CBL has underperformed the S&P 500 Index, declining 16.35% 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.
  • Net operating cash flow has declined marginally to $113.66 million or 4.62% 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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