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."

Oxbridge Re Holdings

Dividend Yield: 7.90%

Oxbridge Re Holdings

(NASDAQ:

OXBR

) shares currently have a dividend yield of 7.90%.

Oxbridge Re Holdings Limited provides reinsurance business solutions primarily to property and casualty insurers in the Gulf Coast region of the United States. It writes collateralized policies to cover property losses from specified catastrophes. The company has a P/E ratio of 5.25.

The average volume for Oxbridge Re Holdings has been 7,700 shares per day over the past 30 days. Oxbridge Re Holdings has a market cap of $36.6 million and is part of the insurance industry. Shares are up 3.9% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates

Oxbridge Re Holdings

as a

hold

. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and weak operating cash flow.

Highlights from the ratings report include:

  • Compared to other companies in the Insurance industry and the overall market, OXBRIDGE RE HOLDINGS LTD's return on equity exceeds that of both the industry average and the S&P 500.
  • OXBR's very impressive revenue growth greatly exceeded the industry average of 12.6%. Since the same quarter one year prior, revenues leaped by 129.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • OXBRIDGE RE HOLDINGS LTD 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. During the past fiscal year, OXBRIDGE RE HOLDINGS LTD increased its bottom line by earning $0.67 versus $0.06 in the prior year.
  • OXBR has underperformed the S&P 500 Index, declining 12.86% from its price level of one year ago. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • Net operating cash flow has declined marginally to -$0.62 million or 9.09% when compared to the same quarter last year. Despite a decrease in cash flow OXBRIDGE RE HOLDINGS LTD is still fairing well by exceeding its industry average cash flow growth rate of -46.59%.

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BG Staffing

Dividend Yield: 8.20%

BG Staffing

(AMEX:

BGSF

) shares currently have a dividend yield of 8.20%.

BG Staffing, Inc. operates as a temporary staffing company in the United States. It operates through three segments: Light Industrial, Multifamily, and IT Staffing. The company has a P/E ratio of 32.00.

The average volume for BG Staffing has been 1,200 shares per day over the past 30 days. BG Staffing has a market cap of $89.9 million and is part of the diversified services industry. Shares are down 5.8% year-to-date as of the close of trading on Friday.

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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 also find weaknesses including generally higher debt management risk and poor profit margins.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 4.8%. Since the same quarter one year prior, revenues rose by 16.2%. 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.
  • When compared to other companies in the Professional Services industry and the overall market, BG STAFFING INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for BG STAFFING INC is rather low; currently it is at 21.83%. Regardless of BGSF'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 2.93% trails the industry average.
  • The debt-to-equity ratio of 1.11 is relatively high when compared with the industry average, suggesting a need for better debt level management. Even though the debt-to-equity ratio is weak, BGSF's quick ratio is somewhat strong at 1.39, demonstrating the ability to handle short-term liquidity needs.

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Universal Technical Institute

Dividend Yield: 9.50%

Universal Technical Institute

(NYSE:

UTI

) shares currently have a dividend yield of 9.50%.

Universal Technical Institute, Inc. provides postsecondary education services for students seeking careers as professional automotive, diesel, collision repair, motorcycle, and marine technicians in the United States. The company has a P/E ratio of 46.56.

The average volume for Universal Technical Institute has been 83,400 shares per day over the past 30 days. Universal Technical Institute has a market cap of $101.1 million and is part of the diversified services industry. Shares are down 57% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates

Universal Technical Institute

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 a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and unimpressive growth in net income.

Highlights from the ratings report include:

  • UTI's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.83 is somewhat weak and could be cause for future problems.
  • 49.17% is the gross profit margin for UNIVERSAL TECHNICAL INST which we consider to be strong. Regardless of UTI'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 -3.49% trails the industry average.
  • UTI, with its decline in revenue, underperformed when compared the industry average of 11.0%. Since the same quarter one year prior, revenues slightly dropped by 6.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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 Diversified Consumer Services industry. The net income has significantly decreased by 912.8% when compared to the same quarter one year ago, falling from $0.37 million to -$2.98 million.
  • Net operating cash flow has decreased to -$8.90 million or 38.93% 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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