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."

World Point Terminals

Dividend Yield: 9.70%

World Point Terminals

(NYSE:

WPT

) shares currently have a dividend yield of 9.70%.

World Point Terminals, LP owns, operates, develops, and acquires terminals and other assets for the storage of light refined products, heavy refined products, and crude oil in the East Coast, Gulf Coast, and Midwest regions of the United States. The company has a P/E ratio of 13.57.

The average volume for World Point Terminals has been 29,900 shares per day over the past 30 days. World Point Terminals has a market cap of $226.9 million and is part of the energy industry. Shares are down 38.5% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates

World Point Terminals

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, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • WPT 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 2.57, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has increased to $18.57 million or 14.91% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -26.50%.
  • Despite the weak revenue results, WPT has significantly outperformed against the industry average of 36.8%. Since the same quarter one year prior, revenues slightly dropped by 0.5%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • WORLD POINT TERMINALS's earnings per share declined by 20.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, WORLD POINT TERMINALS increased its bottom line by earning $0.98 versus $0.76 in the prior year. For the next year, the market is expecting a contraction of 5.1% in earnings ($0.93 versus $0.98).
  • Looking at the price performance of WPT's shares over the past 12 months, there is not much good news to report: the stock is down 33.27%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than 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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Investors Real Estate

Dividend Yield: 7.20%

Investors Real Estate

(NYSE:

IRET

) shares currently have a dividend yield of 7.20%.

Investors Real Estate Trust is a real estate investment trust. The trust invests in real estate markets of United States. It is primarily engaged in investment and operation of the the real estate assets. The company has a P/E ratio of 51.71.

The average volume for Investors Real Estate has been 607,100 shares per day over the past 30 days. Investors Real Estate has a market cap of $886.4 million and is part of the real estate industry. Shares are down 8.2% year-to-date as of the close of trading on Wednesday.

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TheStreet Recommends

TheStreet Ratings rates

Investors Real Estate

as a

hold

. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and revenue growth. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and poor profit margins.

Highlights from the ratings report include:

  • INVESTORS REAL ESTATE TRUST 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, INVESTORS REAL ESTATE TRUST turned its bottom line around by earning $0.11 versus -$0.28 in the prior year. This year, the market expects an improvement in earnings ($0.14 versus $0.11).
  • 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 3106.6% when compared to the same quarter one year prior, rising from -$0.15 million to $4.54 million.
  • Net operating cash flow has slightly increased to $24.78 million or 5.97% when compared to the same quarter last year. Despite an increase in cash flow, INVESTORS REAL ESTATE TRUST's average is still marginally south of the industry average growth rate of 9.39%.
  • The gross profit margin for INVESTORS REAL ESTATE TRUST is currently lower than what is desirable, coming in at 34.26%. Regardless of IRET's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, IRET's net profit margin of 8.81% is significantly lower than the industry average.
  • IRET has underperformed the S&P 500 Index, declining 9.17% from its price level of one year ago. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.

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Teekay LNG Partners

Dividend Yield: 15.10%

Teekay LNG Partners

(NYSE:

TGP

) shares currently have a dividend yield of 15.10%.

Teekay LNG Partners L.P. provides marine transportation services for liquefied natural gas (LNG), liquefied petroleum gas (LPG), and crude oil worldwide. The company has a P/E ratio of 7.48.

The average volume for Teekay LNG Partners has been 284,000 shares per day over the past 30 days. Teekay LNG Partners has a market cap of $1.5 billion and is part of the transportation industry. Shares are down 57.3% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Teekay LNG Partners

as a

hold

. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, generally higher debt management risk and disappointing return on equity.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 109.59% to $85.16 million when compared to the same quarter last year. In addition, TEEKAY LNG PARTNERS LP has also vastly surpassed the industry average cash flow growth rate of -26.50%.
  • The gross profit margin for TEEKAY LNG PARTNERS LP is currently very high, coming in at 75.05%. Regardless of TGP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, TGP's net profit margin of 7.61% compares favorably to the industry average.
  • TEEKAY LNG 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. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, TEEKAY LNG PARTNERS LP reported lower earnings of $2.30 versus $2.49 in the prior year. For the next year, the market is expecting a contraction of 7.2% in earnings ($2.14 versus $2.30).
  • The debt-to-equity ratio of 1.36 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, TGP has a quick ratio of 0.51, this demonstrates the lack of ability of the company to cover short-term liquidity needs.

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