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."

Sabine Royalty

Dividend Yield: 13.60%

Sabine Royalty

(NYSE:

SBR

) shares currently have a dividend yield of 13.60%.

Sabine Royalty Trust holds royalty and mineral interests in various oil and gas properties in the United States. The company has a P/E ratio of 7.02.

The average volume for Sabine Royalty has been 30,900 shares per day over the past 30 days. Sabine Royalty has a market cap of $425.6 million and is part of the financial services industry. Shares are down 19.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Sabine Royalty

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, notable return on equity and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, deteriorating net income and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • SBR 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 3.86, which clearly demonstrates the ability to cover short-term cash needs.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, SABINE ROYALTY TRUST's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for SABINE ROYALTY TRUST is currently very high, coming in at 100.00%. SBR has managed to maintain the strong profit margin since the same quarter of last year. Despite the mixed results of the gross profit margin, SBR's net profit margin of 92.13% significantly outperformed against the industry.
  • The change in net income from the same quarter one year ago has exceeded that of the Oil, Gas & Consumable Fuels industry average, but is less than that of the S&P 500. The net income has significantly decreased by 39.7% when compared to the same quarter one year ago, falling from $15.73 million to $9.48 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 47.84%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 39.81% 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.

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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 5.26.

The average volume for Oxbridge Re Holdings has been 8,600 shares per day over the past 30 days. Oxbridge Re Holdings has a market cap of $36.7 million and is part of the insurance industry. Shares are up 2.2% year-to-date as of the close of trading on Monday.

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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 find that the stock has had a generally disappointing performance in the past year.

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 14.9%. Since the same quarter one year prior, revenues leaped by 249.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • OXBR 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.
  • 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.
  • In its most recent trading session, OXBR has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors.

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Textainer Group Holdings

Dividend Yield: 11.30%

Textainer Group Holdings

(NYSE:

TGH

) shares currently have a dividend yield of 11.30%.

Textainer Group Holdings Limited, together with its subsidiaries, engages in the purchase, ownership, management, leasing, and disposal of a fleet of intermodal containers worldwide. It operates through three segments: Container Ownership, Container Management, and Container Resale. The company has a P/E ratio of 5.48.

The average volume for Textainer Group Holdings has been 350,500 shares per day over the past 30 days. Textainer Group Holdings has a market cap of $945.6 million and is part of the diversified services industry. Shares are down 50.7% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates

Textainer Group Holdings

as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins 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, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Trading Companies & Distributors industry average. The net income increased by 21.9% when compared to the same quarter one year prior, going from $33.01 million to $40.26 million.
  • The gross profit margin for TEXTAINER GROUP HOLDINGS LTD is currently very high, coming in at 88.12%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 29.13% significantly outperformed against the industry average.
  • Net operating cash flow has slightly increased to $88.21 million or 4.85% when compared to the same quarter last year. Despite an increase in cash flow, TEXTAINER GROUP HOLDINGS LTD's cash flow growth rate is still lower than the industry average growth rate of 31.32%.
  • 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 Trading Companies & Distributors industry and the overall market on the basis of return on equity, TEXTAINER GROUP HOLDINGS LTD has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • TGH's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 54.80%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.

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